2 INTRODUCTIONPlanning is outlining a future course of action in order to achieve an objective.Nature – primary function, a dynamic process, based on objectives and policies, a selective process, pervasiveness of planning, an intellectual process, planning is directed towards efficiently, focus with future activities, flexibility of planning, planning is based on facts.
3 PURPOSE OF PLANNING Primary of planning To achieve objectives To cope with uncertainty and changeTo facilitate controlTo help in coordinationTo increase organizational effectivenessTo guide decision- making
4 STEPS INVOLVED IN PLANNING IDENTIFICATION OF OPPORTUNITIESESTABLISHMENT OF OBJECTIVESDEVELOPING PLANNING PREMISESIDENTIFICATION OF ALTERNATIVESEVALUATION OF ALTERNATIVESSELECTION OF ALTERNATIVEFORMULATING DERIVATIVE PLANSESTABLISHING SEQUENCE OF ACTIVITIES
5 ADVANTAGES AND LIMITATIONS Helps in achieving objectivesBetter utilization of resourcesEconomy in operationReduces uncertainty and riskImproves competitive strengthEffective controlCoordinationEncourages motivationGuides in decision makingProvides decentralizationImproves efficiencyAnticipation of crisis
6 Contd… Lack of accurate information Time and cost Inflexibility Delay during emergency periodFalse sense of security
7 OBJECTIVESObjectives are the aims, purpose or goals that an organization wants to achieve over varying periods of time.CharacteristicsObjectives have an hierarchyObjectives form a networkMultiplicity of objectivesObjective have a time spanObjectives may be tangible or intangibleIt must have social sanction
8 SETTING OBJECTIVE Guidelines for setting objectives Cover the main feature of the jobMust be clearly specified in writingIt should be verifiableIt should clearly indicate the organizational missionIt should be challenging and reasonableIt should yield specific results when achievedIt should be coordinated with other units and managersIt should be periodically reviewedIt should clearly indicate the resources and authority
9 MANAGING BY OBJECTIVES (MBO) It is a process whereby the superior and subordinate managers of an enterprise jointly identify its common goals, define each individuals major areas of responsibility in terms of result expected of him, and use these measures as guides for operating the unit and assessing the contribution of each of its members.
10 Features of MBOFocuses attention on what must be accomplished and not how to accomplish the objectives. It is goal oriented rather than work-oriented approach.To integrate the goals of an organization and individuals.It tries to combine long and short range goals of organization.It involves participation of subordinate managers in the goal setting process.
11 Contd…A high degree of motivation and satisfaction is available to employees through MBO.Periodic review of performance is an important feature of MBO.It increases the capability of achieving goals at all levels.MBO’s emphasis is not only on goals but also on effective performance.It provides better guidelines for appropriate systems and procedure to achieve the objective.
12 Contd…It has an evaluative mechanism by which the contribution of each individual can be measured.It is not a set of rules, procedures or techniques; it is a particular way of thinking about management.
13 PROCESS OF MBO Setting preliminary objectives It starts from top level management.It states why the business is started and exists.Short term objectives are framed taking into account the feasibility of achieving the long term objectives.These are formed by viewing the internal and external environment of an organization.It is subjected to modification.
14 Contd… Fixing key result areas Identified based on objectives and planning premises.Reference to measure the organizational health.Arranged on priority basis.Some KRA’s are profitability, market standing, innovation, productivity, market performance, public responsibility.
15 Contd… Setting subordinate objectives Recycling objectives Objectives are achieved through individuals.While setting objectives we should consider organizational goals, ability and resources availableRecycling objectivesGoal setting is a two way process.It should be an interactive one.Matching resources with objectivesObjectives should be carefully matched with available resources.Allocation and movement of resources should be done in consultation with subordinates.
16 Contd… Periodic performance reviews Appraisal Superior and subordinates should hold meetings to discuss the progress towards objectives.Feedback from these reviews is provided to each individuals to facilitate self regulation and control.AppraisalTry to measure the performance of employees.Purpose is to find the shortcomings to reach objectives and the way to rectify them.
17 BENEFITS OF MBO Improvement of managing Clarification of organization Personnel satisfactionTeam workDevelopment of effective controlFast decision making
18 WEAKNESS OF MBO Failure to teach the philosophy of MBO Failure to give guidelines to goal settersDifficulty of setting goalsEmphasis on short term goalsDanger of inflexibilityTime consumingIncreased paper work
19 STRATEGYIt is the determination of basic long term objectives and the adoption of the course of action and allocation of resources to achieve these goals.Nature – SWOT, working towards goal, contingent plan, forward looking, flexible and dynamic, calculation of risk, formulated by top level management.
20 NEED AND IMPORTANCE Facing environmental challenges. Long term guide to reach goal.Effective utilization of resources.Better coordinationHelps in maintaining the market share.
21 STRATEGIC PLANNING PROCESS MISSION AND OBJECTIVESALTERNATIVESENVIRONMENTAL ANALYSISCORPORATEANALYSISSTRATEGIC DECISION MAKINGIMPLEMENTATIONREVIEW AND CONTROL
23 OPERATIONAL PLANNING Communication of strategies Strategies should be communicated to all employeesIt should be make sure that everyone involved in implementing strategies.Developing and communicating planning premisesManagers must develop the planning premises critical to plans and decisions.If managers do not select the premises and it has been implemented on personal assumptions then it lead to improper plans.
24 Contd… Developing appropriate operational plan Action plans, operational programmes and decision that take place in various parts of an organization.Managers should be clear in implementing the program and reviewing it.Periodic review of strategyStrategy should be reviewed periodically to find out whether the given strategy is relevant.Major strategies should be reviewed at least once in a year
25 Contd… Developing contingency strategies and programmes Uncertainty can occur at any time. The formulated strategies should be flexible to make changes.It provide a degree of preparation for future.Developing appropriate organization structureFor proper function a defined structure is needed.It provides facilities for implementing strategy.
26 Contd… Continuing to emphasis planning and implementing strategy Responsible person continue to stress the nature and importance of these elements.It can be achieved by teaching the managers about the aim.Setting proper organizational climateIt refers to the characteristics if internal environment such as the condition of cooperation, dedication of people to work
27 POLICYIt is a broad statement formulated to provide guidance in decision making.CharacteristicsRelationship to organizational objectivesClarity of policyTo guide in decision makingIt should be writtenCommunication of policiesBalance of policy
28 Contd… Need / importance To operationalise objectives To save time and effortTo facilitate delegation of authorityTo speed up decision makingTo control administration
29 POLICY FORMULAITION PROCESS DEFINITION OF POLICY AREADEFINITION OF POLICY ALTERNATIVESEVALUATION OF POLICY ALTERNATIVESCHOICE OF POLICYCOMMUNICATION OF POLICYIMPLEMENTATION OF POLICYREVIEW OF POLICY
30 DECISION MAKINGIt is a process of choosing a course of action from among alternatives to achieve a desired goal.FeaturesSelection processGoal-oriented processEnd processHuman and rational processDynamic processSituationalOngoing process
31 DECISION MAKING PROCESS IDENTIFICATION OF PROBLEMDIAGNOSIS AND ANALYSIS THE PROBLEMSEARCH FOR ALTERNATIVESEVALUATION OF ALTERNATIVESSELECTING AN ALTERNATIVESIMPLEMENTATION AND FOLLOW UP