Fundamentals of Planning

BY Hassan D Aslam

Planning is defining the organizations objectives or goals, establishing an overall strategy for achieving those goals. It is concerned with the ends (what is to be achieved) as well as means (How is to be achieved) Informal Planning (In someone head) Formal Planning (Documented)

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It provides direction Reduces the impact of change means it reduces the uncertainty, managers foresight and clarify the consequences. Minimize the waste Set the standards for controlling

Planning may create rigidity means it can lock the organization in specific goals. Assuming that environment would not be changed during the time period. Plans cant be made for dynamic environment Planning focuses managers attention on todays competition not on tomorrow survival. Formal planning reinforce success which may lead to failure means it generates more confidence than they deserve.

Breath (strategic versus tactical) Time Frame (long term versus short term) Specificity (directional versus specific) Frequency (single use versus standing)

Strategic plans are the plans that are organization wide establish overall objectives, and position an organization in terms of its environment. Plans that apply to the entire organization. Tactical Plans often called operational plans specify the details of how the overall objectives are to be achieved.

STRATEGIC PLANS

TACTICAL PLANS

Strategic plans are of longer period. Deal with broader concepts. Focus on formulations of objectives

Tactical Plans are of shorter period. Deals with short matters routine problems Tactical plans focus on existence of objectives.

Short term plan covers less than one year. Long term plans extend beyond five years.

Specific Plans that have clearly defined objectives and leave no room for misinterpretation. Directional Plans that set out general guidelines.

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DIRECTIONAL PLAN

Have clear defined objectives having no misunderstanding or ambiguity. But they are not well in uncertain circumstances.

Directional plans identify general guidelines. They provide focus but do not lock managers into specific objectives or specific course of action.

Single use plan is used to meet the needs of a particular or unique situation. Standing Plan is ongoing and provides guidance for repeatedly performed actions in an organization.

A system in which specific performance objectives are jointly determined by subordinates and their supervisors, progress toward objectives is periodically reviewed, and rewards are allocated on the basis of that progress.

MBO makes objectives operational as it cascade down the process.

Overall organizational Objectives Divisional Objectives Departmental Objectives Individual Objectives

Goal Specificity Participative Decision Making Explicit time period Performance Period

Identify an employee key job task Establish specific and challenging goals Allow the employee to actively participate Prioritize goals Build in feedback mechanisms to assess goals Links rewards to goal attainment