Lecturer: Mr.

Phạm Xuân Thành

Group 5:
Nguyễn Ái Thùy Linh
Ngô Đức Minh
Phạm Thụy Phương Uyên
Discuss the nature and purposes
of planning

Explain what managers do in the

strategic management process

Compare and contrast approaches

to goal setting and planning

Discuss contemporary issues in

planning
What Is Planning and Why Do Managers
Need to Plan?
Planning is a process that
involves defining the
organization’ s goals,
establishing an overall
strategy for achieving those
goals, and developing a
comprehensive set of plans
to integrate and coordinate
organizational work.
Why Do We Need to Plan?

 Planning is a way to anticipate and offset change.

 Planning reduces contradictions, inconsistency,

overlapping and wasteful activities.

 Planning establishes coordinated efforts.

 Sets the standard to facilitate control.

What Are Some Criticisms Of Formal
Planning?
• Planning may create rigidity.

• Formal plans can not replace intuition and creativity.

• Formal planning reinforces success which may lead to

failure. Managers may need to face that unknown

situations and be open to do thing in the new ways to be

even more successful.

Does Formal Planning Improve
Organizational Performance ?

• Generally, research indicates a positive link between

formal planning and performance.

• When formal planning has not improved performance,

one uncontrollable factors are to blame. Why? Because
managers have fewer viable alternatives.
What Do Managers Need to Know About
Strategic Management?
Strategic management
is what managers do to
develop an organization’s
strategies.
They’re the plans for how
the organization will do
what it’s in business to do,
how it will complete
successfully, and how it
will attract and satisfy its
customers in order to
achieve its goals.
Why Is Strategic Management
Important?
• One reason is that it can make a difference in how well
an organization performs
• Managers in organizations of all types and sizes face
continually changing situations
• Organizations are complex and diverse and each part
needs to work together to achieve the organization’s
goals
What Are the Steps in the Strategic
Management Process?
Strategic management process:
6 steps process involving strategy planning,
implementation and evaluation
What Are the Steps in the Strategic
Management Process?
Step 1: Indentify the organization’s current
mission, goals, and strategies
 Mission- statement defining the purpose of
organization
→ Visible to the public
→ Focus should be placed on all stakeholders
 Current goals and strategies- provides basis for
assessing the need for change
What Are the Steps in the Strategic
Management Process?
 For example:
FedEx Corporation will produce superior financial returns for
its shareowners by providing high value-added logistics,
transportation and related business services through focused
operating companies. Customer requirements will be met in the
highest quality manner appropriate to each market segment
served. FedEx will strive to develop mutually rewarding
relationships with its team members, partners and suppliers.
Safety will be the first consideration in all operations.
Corporate activities will be conducted to the highest ethical
and professional standards.
What Are the Steps in the Strategic
Management Process?
Step 2 & 3: SWOT Analysis
 Step 2: Doing an external analysis
Specific and general environment should be
examined to indentify positive trends
(opportunities) and negative trends (threats)
 Step 3: Doing an internal analysis
Obtaining information regarding an organization’s
spectific resources and capabilities to indentify
strengths and weaknesses
What Are the Steps in the Strategic
Management Process?
Step 4: Formulating strategies
3 types of strategies are formulated after assessing the
SWOT analysis with the current mission statement, goals
and strategies
• Corporate- specifying what business/ industry the
organizations wants to be in and what they want to
do with it.
What Are the Steps in the Strategic
Management Process?
• Competitive- acquiring and maintaining competive
advantage
• Functional- role of functional departments in
achieving competitive strategy
What Are the Steps in the Strategic
Management Process?
Step 5: Implementing strategies
• ‘Organizing’ and ‘leading’ function of management
• Putting strategies into effect
• Proper implementation required to maximize performance
• Important- should not be overlooked
What Are the Steps in the Strategic
Management Process?
Step 6: Evaluating Final Results
• ‘Controlling’ function of management
• How effective have strategies been in achieving its
goals?
• What adjustments are necessary?
What Strategic Weapons Do
Managers Have ?
• Customer service
• Employee skills and loyalty
• Innovation
• Quality
• Social media
• Big data
How Do Managers Set Goals And Develop
Plans?
Goals
• Desired outcome
• Provide direction for all management decisions
• Represent the criteria against which actual work
accomplishments can be measured
Plans
• Outline how goals are going to be met
What Types of Goals Do
Organizations Have?
Types of Goals
• All organizations have multiple objectives
• No single measure can evaluate whether an
organization is successful
What Types of Goals Do
Organizations Have?
Stated goals
Official statements of what an organization says,
and what wants its stakeholders to believe, its
goals are
Real goals
Those goals an organization actually pursues as
shown by what the organization’s members are
doing
How Do They Set Those Goals?

Traditional Goal Setting

• Overall goals established at the top of the
organization
• Overall goals broken down into sub-goals for each
level of the organization
→ network of goals creates a mean-ends chain
• Sub-goals constrain subordinates’ behavior
→ assumes that top managers know what is
best for the organization
How Do They Set Those Goals?
How Do They Set Those Goals?
Management by Objectives (MBO)
• Specific performance goals are jointly determined
by employees and their managers
• Progress toward accomplishing these goals is
periodically reviewed
• Reward are allocated on the basis of this progress
• MBO consists of 4 elements: goal specificity,
participative decision making, explicit time period,
performance feedback.
How Do They Set Those Goals?
Management by Objectives (MBO)
• Increases employee performance and
organizational productivity
• Problems with MBO:
─ can be useless in times of dynamic change
─ overemphasis on personal rather than
organizational goals
─ may be viewed simply as an annual
exercise in paperwork
How Do They Set Those Goals?

Steps in Setting Goals

1. Review the organization’s mission and
employees’ key job tasks
2. Evaluate available resources
3. Determine the goals individually or with inputs
from others
4. Make sure goals are well-written and then
communicate them to all who need to know
How Do They Set Those Goals?

Steps in Setting Goals

5. Build in feedback mechanisms to assess goal
progress
6. Link rewards to goal attainment
What Types of Plans Do Managers
Use?

 BREADTHS OF USE
Strategic plans are those that apply to an entire
organization and encompass the organization’s
overall goals
Tactical plans specify the details of how the
overalls goals are to be achieved
What Types of Plans Do Managers
Use?

 TIME FRAME
Long-term plans: Plans with a time frame beyond
three years
Short-term plans: Plans with a time frame of one
year or less
What Types of Plans Do Managers
Use?

 SPECIFICITY
Specific plans: Plans that are clearly defined and
leave no room for interpretation
Directional plans: Plans that are flexible and set
general guidelines
What Types of Plans Do Managers
Use?

 FREQUENCY OF USE
A single-use plan: A one-time plan specifically
designed to meet the needs of a unique situation
Standing plans: Plans that are ongoing and
provide guidance for activities performed
repeatedly
How Do They Develop Those Plans ?

Contingency Factors in Planning

• Level in the organization
– Operational planning dominates managers’
planning efforts at lower levels
– Strategic planning more characteristic of
planning at higher level
How Do They Develop Those Plans ?
How Do They Develop Those Plans ?

Contingency Factors in Planning

• Degree of environmental uncertainty
• Length of future commitments
– Commitment concept: plans should extend
far enough to meet those commitments made
when the plans were developed
How Do They Develop Those Plans ?
Approaches to Planning
• Traditional, top-down approach
– Planning done by top managers
– Formal planning department: a group of planning
specialists whose sole responsibility is to help write
the various organizational plans
– Plans flowed down to lower levels
– Most effective if plan is workable document used
by organizational members for direction and
guidance
How Do They Develop Those Plans ?

Approaches to Planning
• Inclusive approach
– Employees at each level develop plans suited to
their needs
– Employees acquire greater sense of the
importance of planning when they participate in the
process
– Plans more likely to be used in directing and
coordinating work
What Contemporary Planning Issues Do
Managers Face?
How Can Managers Plan Effectively
in Dynamic Environments ?

• Develop plans that are specific, but flexible

• Recognize that planning is an ongoing process
• Change directions if environmental conditions warrant
• Stay alert to environmental changes
How Can Managers Use
Environmental Scanning?
• Analyses external environments
• More detailed analysis on competitive companies
• Allows for benchmarking