Fundamentals of Management Management Myths Debunked! PDF

Copyright ©2017 Pearson 5-1 Education, Ltd. 5 Foundations of Planning Copyright ©2017 Pearson 5-2 Education, Ltd.  Learning Outcomes  Discuss the nature and purposes of planning.  Explain what managers do in the strat...

Copyright ©2017 Pearson 5-1 Education, Ltd. 5 Foundations of Planning Copyright ©2017 Pearson 5-2 Education, Ltd.  Learning Outcomes  Discuss the nature and purposes of planning.  Explain what managers do in the strategic management process.  Compare and contrast approaches to goal setting and planning.  Discuss contemporary issues in planning. Copyright ©2017 Pearson 5-3 Education, Ltd. 5-1 Discuss the nature and purposes of planning. Copyright ©2017 Pearson 5-4 Education, Ltd.  What is Planning? Planning: the primary management function. Copyright ©2017 Pearson 5-5 Education, Ltd. Reasons for Planning Copyright ©2017 Pearson 5-6 Education, Ltd.  Criticisms of Formal Planning May create rigidity Can’t replace intuition and creativity Focuses attention on today’s success, not tomorrow’s survival Reinforces success, which may lead to failure Copyright ©2017 Pearson 5-7 Education, Ltd.  Formal Planning and Organizational Performance Does it pay to plan? Higher profits Higher return on assets Improved quality of planning Appropriate implementation Copyright ©2017 Pearson 5-8 Education, Ltd. 5-2 Explain what managers do in the strategic management process. Copyright ©2017 Pearson 5-9 Education, Ltd. Strategic Management What managers do to develop an organization’s strategies Copyright ©2017 Pearson 5-10 Education, Ltd.  The Importance of Strategic Management It has a positive impact on organizational performance It prepares managers to cope with changing situations It guides managers to examine relevant factors in planning future action Copyright ©2017 Pearson 5-11 Education, Ltd. Steps in the Strategic Management Process Copyright ©2017 Pearson 5-12 Education, Ltd.  Step 1: Identify Mission, Goals and Strategies Copyright ©2017 Pearson 5-13 Education, Ltd. External and Internal Analyses Step 2: External Step 3: Internal Analysis Analysis Competition Resources Components of Capabilities environment Core Threats and competencies opportunities Organizational strengths and weaknesses Copyright ©2017 Pearson 5-14 Education, Ltd.  Formulating, Implementing, and Evaluating Results Step 4: Step 6: Evaluate Formulate Results Strategies How effective Corporate have strategies Business been? Functional What Step 5: adjustments are Implement necessary? Strategies Copyright ©2017 Pearson 5-15 Education, Ltd. Strategies Managers Use Copyright ©2017 Pearson 5-16 Education, Ltd.  Growth Strategy An organization expands the number of markets served or products offered Concentration Vertical integration Horizontal integration Diversification Copyright ©2017 Pearson 5-17 Education, Ltd.  Stability and Renewal Strategies Stability strategy Renewal strategy Organization continues Organization to do what it’s doing addresses declining organizational performance Retrenchment Turnaround Copyright ©2017 Pearson 1-18 Education, Ltd. Competitive Strategy Competitive strategy: a strategy for how an organization will compete in its business. Copyright ©2017 Pearson 1-19 Education, Ltd.  Competitive Advantage What sets an organization apart; its distinctive edge that comes from its: core competencies and resources Copyright ©2017 Pearson 1-20 Education, Ltd. Gorge is a new businessman wants to open a jeans store. To compete with other existing companies, he decided to customize the pants according to the customer order. He can do a writing or drawing on the jeans to provide higher value with higher price than other competitors. - Which competitive strategy of the following Gorge has chosen to compete? A) Cost leadership strategy B) Differentiation strategy C) Focus strategy D) Stuck in the middle Copyright ©2017 Pearson Education, Ltd. 1-21  Functional Strategy Those strategies used by an organization’s various functional departments to support the competitive strategy Copyright ©2017 Pearson 1-22 Education, Ltd.  Strategic Weapons Customer service Employee skills & loyalty Innovation Quality Social media Big data Copyright ©2017 Pearson 1-23 Education, Ltd. 5-3 Compare and contrast approaches to goal setting and planning. Copyright ©2017 Pearson 5-24 Education, Ltd.  Setting Goals and Developing Plans Types of goals Financial versus strategic Stated versus real Copyright ©2017 Pearson 5-25 Education, Ltd. Traditional Goal Setting Copyright ©2017 Pearson 5-26 Education, Ltd.  Management by Objectives Goal specificity Participative decision making Explicit time period Performance feedback Copyright ©2017 Pearson 5-27 Education, Ltd. Well-Written Goals Copyright ©2017 Pearson 5-28 Education, Ltd.  Steps in Goal Setting 1. Review the organization’s mission and employees’ key job tasks. 2. Evaluate available resources. 3. Determine the goals individually or with input from others. 4. Make sure goals are well-written and communicate to all who need to know. 5. Build in feedback mechanisms to assess goal progress. 6. Link rewards to goal attainment. Copyright ©2017 Pearson 5-29 Education, Ltd. Types of Plans Copyright ©2017 Pearson 1-30 Education, Ltd. Developing Plans Copyright ©2017 Pearson 1-31 Education, Ltd. Approaches to Planning Top-down traditional approach Development by organizational members Copyright ©2017 Pearson 1-32 Education, Ltd. 5-4 Discuss contemporary issues in planning. Copyright ©2017 Pearson 5-33 Education, Ltd.  Contemporary Issues Planning in dynamic environments Environmental scanning Copyright ©2017 Pearson 5-34 Education, Ltd.