Business Management Planning Techniques PDF

LESSON 3 Planning at Different Levels in the Firm  Different levels in the firm are all engaged in planning: however, all the resulting plans must be related to one another and directed toward the same goals. Planning at the different levels of management include strategic planning, tactical plan...

LESSON 3 Planning at Different Levels in the Firm  Different levels in the firm are all engaged in planning: however, all the resulting plans must be related to one another and directed toward the same goals. Planning at the different levels of management include strategic planning, tactical planning, and operational planning. Top-level Management Planning (Strategic Planning) As earlier mentioned, top-level managers are responsible for the organization's strategic planning which involves making decisions about the organization's long-term goals and strategies. CEOs,company presidents, or the organization's senior executives develop and execute the said strategic plan. They, however, do not formulate or execute the plan on their own; a management team supports and helps top-level managers in carrying out these tasks. Strategic planning starts with defining the organization's goals/objectives, the major targets related to the maintenance of the organization's stability, and its organizational culture, values, and growth improving its productivity, profitability, effectiveness, and efficiency, among others. -Bateman and shell (2008) stated that an effective strategy provides a basis for answering five broad questions about how organizations will meet its goals/objectives: 1. Where will we be active? 2. How will we get there? 3. Whoe will we win in the marketplace? 4. How fast will we move and in what sequence will we make changes? 5. How will we obtain financial returns? Middle-level Management Planning (Tactical Planning) Tactical planning refers to a set of procedures for changing or transforming broad strategic goals and plans into specific goals and plans that are applicable and needed in one unit/portion of the organization. It is focused on major actions that must be done by a unit in order to contribute its share for the achievement of the strategic plan. Frontline/ Lower-Level Management Planning (Operational Planning) Operational planning involves identifying the specific procedures and processes required at the lower levels of organization.This also involves routine tasks or tasks repeatedly done by the organization's lower level units. Integrating Strategic, Tactical, and Operational Planning The present organizational planning is not as rigid as the hierarchical planning earlier discussed in this chapter. Managers in different hierarchical levels of the organization may contribute their ideas or suggestions in developing the strategic plan, a task originally assigned to the senior executives. Also, frontline managers may make formulation in the higher levels. All plans, however, must be directed toward the achievement of the organization's strategic goals. Finally, CEOs or company presidents must see to it that all communication lines in their organization are open, that there is excellent dissemination of information to all levels, and they are aware of everything that is happening in their firm. Definition of Terms Strategic Planning - is top-level planning which involves making decisions about the organization's long term goals Tactical Planning - is middle-level management planning which refers to procedures and transformation of strategic goals/plans with specific goals Operational Planning - is lower-level management planning which involves routine tasks repeatedly done by the firm's lower level units. LESSON 4 Planning Techniques and Tools and their Applications  For effective planning in today's dynamic environments, different techniques and tools must be used, such as forecasting, contingency planning, scenario planning, benchmarking, and participatory planning According to Schermerhorn (2008), forecasting is an attempt to predict what may happen in the future. All planning types, without exception, make use of forecasting. Business periodicals publish forecast such as employment and unemployment rates, increase of decrease of interest rates, stock market data,GNP/GDP data, and others. Forecasts used may either be quantitative or qualitative. Opinions of prominent economists are used in qualitative forecasts while mathematical calculations and statistical analyses of surveys/researches are used in quantitative forecasts. These, however, are just aids to planning and must be treated with caution. As the name implies, forecasts are predictions and may be Inaccurate, at times, due to errors of humann judgment. Contingency factors may offer alternative courses of action when the unexpected happens or schen things go wrong Contingency plans muut be prepared by managers, ready for implementation when things do not turn out as they should be. Contingency factors called "trigger points" indicate when the prepared alternative plan should be implemented. Meanwhile, planning for future states of affairs is a long-term version of contingency planning and is also known as wenario planning Several future states of affairs must be alternative plans mest be prepared in order to meet the changes or challenges in the future. This is a big help for organizations because it allows them to plan ahead and make necessary adpustments in their strategies and operations. Some esamples of changes or challenges that may arise in future scenarios are environmental pollution, human rights violations, climate and weather changes, earthquake damages to communities and others.  Benchmarking is another planning technique that generally involves external comparisons of a company's practices and technologtes with those of other companies. Its main purpose is to find out what other people and organizations do well and then plan how to incorporate these practices e company's operations. A common benchmarking technique is to into the search for best practices used by other organizations than ftabled them to achieve superior performance. This is known as external benchmarking Internal benchmarking is also practiced by some organizations when they encourage all their employees working in their different work units to learn and improve by sharing one another's best practices Participatory planning is a planning process that includes the people who will be affected by the plans and those who will be asked to implement them in all planning steps. Creativity, increased acceptance and understanding of plans, and commitment to the success of plans are the positive results of this planning technique. Definition of Terms Trigger point change in an attribute, condition, factor, parameter or value that represents crowing a threshold and actuanes ontaten a mechanumo reaction that may lead to radically different state of affans Forecasting an att pmdict what may happen in the future Benchmarking-planning technique that involves comparison of company's practice technologies with those of other companies. LESSON 5 DECISION-MAKING  AIl managers and workers/employees in organizations make decisions or make choices that affect their jobs and the organization they work for. This lesson's focus is on how they make decisions by going through the eight steps of the decision- making process suggested by Robbins and Coulter (2009). Types of Decisions A decision is a choice among possible alternative actions. Like planning, decision-making is a challenge and requires careful consideration for both types of decisions, namely: Structured or programmed decision - a decision that is repetitive and can be handled using a routine approach. Unstructured or nonprogrammed decisions- applied to the resolution of problems that are new or unusual, and for which information is incomplete. Such nonprogrammed decisions are described to be unique, nonre- curring and need custom-made decisions. For example, a hotel manager is asked to make a decision regarding the building of a new hotel branch in another city to meet the demands of businessmen there. This is an unstructured problem and, therefore, needs unstructured or nonpro- grammed decisions to resolve it. Types of Decision-making Conditions Conditions, under which decisions are made, also vary. These are: Certainty conditions - ideal conditions in deciding problems; these are situations in which a manager can make precise decisions because the results of all alternatives are known. For example, bank interests are made known to clients so it is easier for business managers to decide on the problem of where to deposit their company's funds. The bank which offers the highest interest rate, there- fore, is the obvious choice of the manager when asked to make a decision. Risk or uncertainty conditions- a more common condition in deciding problems.  Risk or uncertainty conditions compel the decision maker to do estimates regarding the possible occurrence of certain outcomes that may affect his or her chosen solution to a problem. Historical data from his or her own experiences and other secondary information may be used as bases for decisions to be made by the decision maker under such risk conditions. For example, a manager is asked to invest some of their company funds in the money market offered by a financial institution. Risk factors must be considered, because of the uncertainty conditions involved, before making a decision-whether to invest or not in the said money market. Definition of Terms Decision-making - is a process which begins with problem identification and ends with the evaluation of implemented solutions ➤ The Decision-making Process according to Robbins and Coulter Step 1: Identify the Problem. The problem may be defined as a puzzling circumstance or a discrepancy between an existing and a desired condition. Step 2: Identify the Decision Criteria. These are important or relevant to resolving the identified problem. Step 3: Allocate Weights to the Criteria. This is done in order to give the decision maker the correct priority in making the decision. Step 4: Develop Alternatives. This step requires the decision maker to list down possible alternatives that could help resolve the identified problem. Step 5: Analyze the Alternatives. Alternatives must be carefully evaluated by the decision maker using the criteria identified in Step 2. Step 6: Select an Alternative. This is the process of choosing the best alternative or the one which has the highest total points in Step 5. Step 7: Implement the Chosen Alternative. This step puts the decision into action. Changes in the environment must be observed and assessed, especially in cases of long-term decisions, to see if the chosen alternative is still the best one. Step 8: Evaluate Decision Effectiveness. This is the last step and involves the evaluation of the outcome or result of the decision to see if the problem was resolved. If the problem still exists, the manager has to assess what went wrong and, if needed, repeat a step or the whole process. That’s all thank you!!!