1. CHAPTER OBJECTIVES PLANNING AND ORGANIZING nJustify the value of planning for a business. nDifferentiate between the two levels of planning— strategic and operational nProvide examples of seven planning tools used by managers. nIdentify four characteristics of a good organization. Responsibility and authority, accountability, unit of command, span of control nDefine two traditional types (line and staff) and two newer types of organization structure (team and maxtrix). 1313

2. PLANNING FUNCTION nImportance of planning nMost businesses fail because they fail to adequately plan nThose that can and do plan, are likely to be successfully nA business plan is needed - written description of the nature of the business, goals, objectives, and how to achieve these nIt also analyzes risks the business will face

3. nImportance of Planning nAll Mgrs are involved in planning nBig or Small nMgrs develop short-term plans such as work schedules nPlanning is most important mgm’t activity nSets the direction for the business, establishes specific goals, serves as a guide for making decisions nUse plans to determine if the business if making progress nHelps in communicating, coordinating and encourages mgr.s to be specific

4. nLevels of planning nMgr.s plan on two levels nStrategic planning nLong term; broad goals; direction for entire business nOperational planning nShort term; IDs specific activities for each area/department

5. nStrategic nPlanning over a long period - even years nDone by the top managers nTells mgr.s where the business is going nNeed to gather info. to determine if a decision is going to be profitable nFirst two steps referred to as SWOT nInternal/External analysis of nStrengths nWeaknesses nOpportunities nThreats

6. Step 5: Strategies Step 4: Goals Step 3: Mission Step 2: Internal Analysis Step 1: External Analysis STRATEGIC PLANNING STEPS

7. nOperational Planning – 2 nd type of planning nMiddle-level mgr.s and supervisors nDetermines how the work will be done, who will do it, and what resources will be needed to get it done nFactory - developing dept. budgets, planning inventory levels, purchasing raw mat’ls, setting production levels, work schedules nMarketing dept - development of promotional plans, ID’ing training needs, decide how to support retailers, selecting pricing methods

8. PLANNING TOOLS – 7 of them nGoals - specific statement of a result the business expects to achieve nSpecific and meaningful nAchievable nClearly communicated nConsistent w/ other goals and w/ overall company goals nBudgets nMost widely used planning tool nSpecific financial plan

9. nSchedules nPlans for most effective use of time nPlans time to reach objectives nStandards - specific measure against which something is judged nBusinesses set standards for goods/service nCompare their products against the standards to know whether the quality is acceptable PLANNING TOOLS

10. nPolicies - guidelines used in making decisions regarding specific, recurring situation nGeneral rule followed by the entire company or specific departments nPolicies reduce misunderstandings and encourages consistent decisions nProcedures - list of steps to be followed for performing certain work PLANNING TOOLS

11. nResearch nNeed a great deal of info to do a good job in planning nUsed to collect data nProvides info. needed to make improved planning decisions PLANNING TOOLS

12. ORGANIZING FUNCTION nConcerned with determining how plans can be accomplished most effectively and arranging resources to complete work nRole of organization charts - drawing that shows the structure of an org. nShows the departments that make up the org. nIndicate E’s departments and to whom each report to nID lines of authority and formal communication w/i the org.

13. ORGANIZING FUNCTION nElements of organization nDivision of Work nWork must be divided nDept’s should have related tasks nWork should flow smoothly w/i dept. nAll tasks should be assigned to an E nFacilities and Working Conditions nPhysical aspect must be considered nNecessary equipment nLayout of facility nNeed best working conditions possible nWork needs to move through the business as efficiently as possible

14. ORGANIZING FUNCTION nElements of organization nWorking Condition con’t nJob satisfaction is influenced by lighting, temperature, ventilation, and cleanliness nOutside work areas too - parking, cafeterias nEmployees nEs need to be matched to work that they are prepared to do nAssigned to work they enjoy nSpread less desirable assignments among Es

15. ORGANIZING FUNCTION nCharacteristics of good organization nResponsibility and Authority nEach E and mgr need to specifically know nthe description and duties of each job nwhat authority accompanies the job nmgr. is in charge nwho reports to the mgr nwhat is considered satisfactory performance nAccountability nMgr. is ultimately responsible for the work nE is accountable to the mgr for performing the assigned work properly

16. ORGANIZING FUNCTION nCharacteristics of good organization nUnity of command nNo E’ee reports to more than one supervisor at a time nSpan of control nThe number of Eee’s that any one mgr. directly supervises nMust be reasonable

17. ORGANIZING FUNCTION nTypes of organizational structure nLine - authority and responsibility can be traced in a direct line from the top executive down to the lowest E level nPresident has direct control over all units nResponsibility, authority and accountability are passed along from one person to another down to the lowest level nEach person is responsible to only ONE mgr.

18. ORGANIZATION CHART Delivery Service and Repairs Advertising and Promotion Mgr. Customer Service Manager Sales Manager VP Purchasing VP Merchandising VP Finance General Manager

19. ORGANIZING FUNCTION nTypes of organizational structure nLine-and-staff – pg 341 nMgrs. Have direct control over the units and Es they supervise but have access to staff specialists for assistance nStaff specialists give advise and assist line personnel nStaff specialists have NO authority over line personnel

20. ORGANIZING FUNCTION nTypes of organizational structure nMatrix nNew, more flexible nCombines workers into temporary work teams to complete specific projects nEs report to a project mgr. nNo permanent organizational structure nTeam nNewest type nDivides Es into permanent work teams nTeams have team leaders

21. ORGANIZING FUNCTION nImproving business organization nCentralized organization - few top mgrs. do all major planning and decision making nOld style; caused problems including communication problems..changed to… nDecentralized organization - unit mgrs. have almost total responsibility and authority nUnits operate as if they were independent companies nFlattened organization - fewer levels of mgm’t than traditional structures nRemaining mgrs. and Es assume many of the responsibilities previously assigned to other levels of mgm’t.