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Planning MRK 151 Chapter 2. Planning Planning is deciding in advance what to do, how to do, when to do and who is to do. Planning bridge the gap from.

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Presentation on theme: "Planning MRK 151 Chapter 2. Planning Planning is deciding in advance what to do, how to do, when to do and who is to do. Planning bridge the gap from."— Presentation transcript:

1 Planning MRK 151 Chapter 2

2 Planning Planning is deciding in advance what to do, how to do, when to do and who is to do. Planning bridge the gap from where we are to where we want to go. Characteristics of planning : 1- it is closely associated with the goals of the organization. 2- primarily concerned with the forecasting of future situation. 3- involves the selection of the best among several alternatives for achieving the organization objectives. 4- comprehensive and is required in every course of action in the organization. 5- is flexible as it is based on future conditions which are always dynamic.

3 Nature of Planning The essential nature of planning can be highlighted in terms of the following four major aspects: 1- contribution to purpose and objectives. 2- primacy of planning. 3- pervasiveness of planning 4- efficiency of plans

4 Importance of Planning 1- to off-set uncertainty and change 2- to focus on objectives 3- to help in coordination 4- to gain economy in operation 5- to help in control 6-to increase organizational effectiveness.

5 Types of Plans There are eight different types of plans, some of these are in the form of standing plans while some others are single-use plans. the basic difference between them is the standing plans are used over a long period of time, while single-use plans are used for only specific periods. the types are : 1- objectives 2- policies 3- strategies

6 Types of Plans 4-procedures: A) policy and procedures B) characteristics of a good procedure: - based on facts -procedure as a system - well-balanced -updating procedures -minimum procedures 5- rules 6- methods 7- projects 8-budgets

7 Steps in Planning It is not possible to prescribe a certain fixed process of planning for all organization or for all types of plans. The major steps of planning : 1- perception of opportunities 2- establishing objectives 3-establishing planning premises 4- determining alternative courses of action 5- evaluating alternative courses 6- selecting the best course 7-formulating derivative plans

8 Limitation of Planning Limiting factors help in removing many difficulties in planning, these factors are explained as follows: 1- lack of accurate information 2-problems of change 3-failure of people 4-internal inflexibilities 5-external inflexibilities 6-rigidity in planning 7-time and cost factors

9 Planning Premises Planning premises constitute the framework within which planning is done. 1-Importance of forecast: forecasting offers the following advantages: _it helps by providing scientific and reliable basis for anticipating future operation. _it aims at reducing the area of uncertainty the surround management decision- making. _will compel the managers to think ahead and to search for the best decision. _for managerial control will disclose the areas where control is lacking. 2- effective premising: will minimize the difficulty in identifying the factors in future environment that will affect the manager's plans.

10 Planning Premises 3- forecasting methods: _qualitative techniques ted to apply for the long term time to identifying the future needs and select the best options open for the company. _quantitative techniques tend to be used as a means of quantifying future demand.

11 Corporate Planning It is a process of determining the major objective of an organization and the policies and strategies that will govern the acquisition and of resources to achieve those objectives.

12 Characteristics 1_corporate plan deals with formulation of objectives,plans, policies and strategies and making decisions. 2_it deals with the future impact of current decisions. 3_it involves opportunities and threats and matching them with strengths and weaknesses of the organization. 4_provied integrated framework.

13 Corporate Planning Objectives 1- allocation of scarce resources like capital, materials and technology. 2- preparing the company to adapt the environment opportunities and threats. 3- coordinating strategic activities to reflect the internal strengths and weaknesses. 4-preparing the company for adaptation and integration to get in the most efficient manner. 5-to learn from the outcomes of past strategic decision.

14 Importance of Corporate Planning 1- corporate planning encourages the habit of forward thinking on the part of manager. 2-it helps in attaining overall coordination among the various levels of management. 3-it creates a greater awareness of the business environment. 4- it enable the organization to anticipate technological changes. 5- it can lead to improvement in overall performance of the organization.

15 Process of Corporate Planning 1- scanning the environment. 2- making corporate appraisals. 3- determining of mission and objectives 4- making strategies. 5- development of action plans. 6- implementing the strategy.

16 How Strategic and Operational Plans Differ 1- time horizon: strategic plans consider several years or even decades, while operational plans year is the relevant time period. 2-scope: strategic plans affect a wide range of organizational activities, while the operational plans have a narrow and limited scope. 3-degree of detail: strategic plans are simplistic and generic, while operational plans more in details.

17 Strategies at Different Levels 1- corporate strategy : At the corporate level, strategic decisions relate to organization policies. 2- business level strategy : To achieve the specific objectives of the strategic business unit to help achieve the overall corporate objective. 3- functional level strategy: The success of the SBU will depend, on other things, on the effectiveness with which it is translated into functional areas like : marketing, finance, production.

18 Strategic Planning Features of strategic planning: 1- strategic planning emphasizes the basic mission and goal of the organization. 2- determines the basic policy and programs. 3- the time frame is larger than other type of planning. 4- it provides for coherence in organization policy and decision on activity over time. 5- it deals with uncertain environment. 6-It is comprehensive and is a unified plan.

19 Limitations of Strategic Planning 1-strategic planning require an investment in time, money and human resources. 2-small organization cannot afford the cost or the strategic planning. 3-strategic planning requires trained persons to make use of opportunities. 4- strategic planning restrict the organization for the risk-free options.

20 Vision, Mission and Purpose The vision is the image of what a company wants to be or wants to be known for : _Conceiving vision : the must effective vision should link the company's core values to a perception of how you want your future to look like. _Shared vision: must linking it to an entire strategic chain to make it useful for the company, and become the starting point of the process in sitting objectives for every division or business unit.

21 Vision, Mission and Purpose why need a vision: _Vision is adding to the activities of the people. _vision is the hallmark of an enlightened forward-looking organization. What can go wrong with vision: _ the company's vision can become the extension of CEO,s ego _ some companies overcommitted themselves to their vision, ignoring the changes around them.

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