MANAGEMENT

PLANNING

CONTENT
Planning
Why do managers plan?
Types of Plans
Goals and its Types
Approaches to Setting Goals
Traditional
MBO
Characteristics of Well Written Goals
Steps in Goal Setting
Developing Plans

Contingency Factors

Approaches to Planning
Criticism of Planning
Effective Planning in Dynamic Environments

WHY DO MANAGERS PLAN?

KARSANBHAI PATEL
A CHEMIST
STARTED NIRMA IN 1969
AS A ONE MAN
OPERATION.

HE STARTED
MANUFACTURING IN THE
BACKYARD OF HIS HOME.
SOLD WITH RIDING ON THE
BICYCLE AT RS 3 PER KG.

TODAY NIRMA HAS 14,000 EMPLOYEES

AND AN ANNUAL TURNOVER OF MORE
THAN 25,000 CRORES

TYPES OF PLANS

GOALS (OBJECTIVES) are desired outcomes or

targets
R. Molz, How Leaders Use Goals, Long Range Planning, October 1987, pp. 91

TYPES OF GOALS
STATED
REAL

STATED GOALS Official Statements of what

an organization says - and what it wants its
various stakeholders to believe its goals are
TO BE A GLOBAL TRANSFORMATION PARTNER
INFOSYS
EXPERIENCE CERTAINTY (RESULTS, PARTNERSHIP, LEADERSHIP)

TCS
BRING INSPIRATION AND INNOVATION TO EVERY ATHLETE.

NIKE

REAL GOALS Goals that an organization

actually pursues, as defined by the actions of its
members.

APPROACHES TO SETTING GOALS

TRADITIONAL
MANAGEMENT BY OBJECTIVE (MBO)

TRADITIONAL GOAL SETTING

An approach to setting goals in which top managers set

goals that flow down through the organization and
become sub-goals for each organizational area.
I want to see a significant
improvement in this divisions profit

Top Managements
Objective

Division Managers Objective

Dont worry about quality; just work

fast

Department Managers Objective

Individual Employees Objective

We need to improve the companys

performance

Increase profits regardless of the

means

MANAGEMENT BY OBJECTIVE (MBO)

A process of setting mutually agreed upon goals and

using those goals to evaluate employees performance.

Top Managements
Objective

Division Managers Objective

Department Managers Objective
Individual Employees Objective

MANAGEMENT BY OBJECTIVE (MBO)

A process of setting mutually agreed upon goals and

using those goals to evaluate employees performance.
Top Managements
Objective

Division Managers Objective

Department Managers Objective

Individual Employees Objective

MANAGEMENT BY OBJECTIVE (MBO)

A process of setting mutually agreed upon goals and

using those goals to evaluate employees performance.

Top Managements
Objective

Division Managers Objective

Department Managers Objective
Individual Employees Objective

MANAGEMENT BY OBJECTIVE (MBO)

A process of setting mutually agreed upon goals and

using those goals to evaluate employees performance.

Top Managements
Objective

Division Managers Objective

ORGANIZATION
WITH
WELL-SETTED
Department
Managers Objective
GOALS
Individual Employees Objective

MANAGEMENT BY OBJECTIVE (MBO)

A process of setting mutually agreed upon goals and

using those goals to evaluate employees performance.
Goal Specificity

Participative Decision Making

Explicit Time Period

Performance Feedback

CHARACTERISTICS OF WELL WRITTEN GOALS

STEPS IN GOAL - SETTING

Peter Drucker
Year: 1954
SMART

Specific
Measurable
Attainable
Relevant
Time Bound

DEVELOPING PLANS

ORGANIZATIONAL LEVEL AND PLANNING

TOP EXECUTIVES

STRATEGIC
PLANNING

MIDDLE LEVEL MANAGERS

FIRST LEVEL MANAGERS

OPERATIONAL
PLANNING

H. Mintzberg, The Rise and Fall of Strategic Planning (New York: The Free Press,
1994)

G. Hamel and C.K. Prahalad, Competing for the Future (Boston: Harvard Business
School Press, 1994)

D. Miller, The Architecture of Simplicity, Academy of Management Review, January

1993, pp. 116-138

M. C. Mankins and R. Steele, Stop Making Plans Start Making Decisions, HBR,
January 2006, pp. 76-84

EFFECTIVE PLANNING IN DYNAMIC ENVIRONMENT