PLANNING

Organization and Management

The Importance of Planning

Planning is Utilized with these Objectives: 1. The offset uncertainty and change: The future is not certain. The

further we project in the future, the more difficult it is to make decisions. Planning allow the organization to determine constrains, specify the objective, select number of options, minor and control the implementations as to allow re-planning, in necessary.

The Importance of Planning

2. To Focus Attention on Objectives: Planning is directed towards achieving objectives. In this way, it unifies the activities of the different parts of an organization act as one party.

3. To gain Economical and Efficient Operations: Planning minimize costs. Its emphasis is on efficient and effective operation and consistency of procedures and methods

The Importance of Planning

4. To Facilitate Control: Managers cannot always check on accomplishment of failures of their subordinates. There is very little time to do this. It is important to have goals against whom to measure the performance of people or units.

Basic Steps in Planning

Being Aware of Opportunities in light of: The market

Competition

What customers want

Our strengths

Our weaknesses

Setting Objectives or Goals: Where we want to be and what we want to accomplish and when

Basic Steps in Planning

Considering Planning Premises: In what environment- internal or external- will our plans operate ?

Identifying Alternatives: What are the most promising alternatives to accomplishing our objectives ?

Comparing Alternatives in Light of Goals: Which alternative will give us the chance of meeting our goals at the lowest cost and

highest profit ?

Choosing an Alternative: Selecting the course of action we will pursue

Basic Steps in Planning

Formulating Supporting Plans:

Such as plans to: Buy equipment

Buy materials Hire and train workers

Develop a new product

Quantifying Plans By making Budgets

Developing such budgets as: Volume and price of sales

Operating expenses necessary for plans

Expenditures for capital equipment

The Objectives

The objectives are general parts of planning process. They are the end result towards which all business activities are directed. They are needed in every aspect where performance and result directly and vitally affect the survival and success of the firm. In other words, the objective of the firm justify existence.

The Objectives

Are the targets or the ends the manager wants to reach. To be effective, goals should have certain qualities, which are easy to remember with the acronym SMART. • Specific- when goals are precise, describing particular behaviors and outcomes,

employees can more easily determine whether they are working toward the goals.

• Measurable- as much as possible, each goals should quantify the desired results so there is no doubt whether it has been achieved.

• Attainable (but challenging)- employees need to recognize that they can attain the goals they are responsible for, or else they are likely to become discouraged. However, they also should feel challenged to work hard and be creative.

The Objectives

• Relevant- each goal should contribute to the organization’s overall mission, while being consistent with its values, including ethical standards. Goals are most likely to be relevant to the organization’s overall objectives if they are consistent with in and among work groups.

• Time-bound- effective goals specify a target date for completion. Besides knowing what to do, employees should know when they need to deliver results.

The Objectives

Characteristics of Business Objectives 1. They are multiple in natures- Business firm can never have only one objective.

2. Objectives have hierarchy- Objectives are being set in every level of organizational hierarchy.

3. Objectives form a network- Objectives are independent and mutually supportive and the accomplishment of one objectives does not necessarily mean the immediate attainment of other objectives.

4. Objectives may be long-range or short-range- The long-range objectives are stated in general and broad terms while short-range objectives are stated in specific and define terms

5. Business objectives are verifiable- Objectives are expressly stated in numerical terms so that they may be verifiable.

The Policies

• Are the general statements or understanding which guide or channel thinking and action in decision-making.And which direct the thurst of the leader or an organization

• Policies delimited an area in which a decision must be made.They assure that decisions will be consistent with and contribute to objectives

• Policies precede issues,allowing managers to delegate authority while maintaining control;help them avoid repeated mistakes,and give a unified structure to various activities

The Policies

• Policies must allow some discretion,they should not be too rigid nor too detailed

• Lack of policies become very clear when there are conflicts about interpreting specific procedures or making decisions about specific problem

• Government departments must have policies in key critical areas so to facilitate the planning,programming and budgeting process , and to make more efficient and affective the delivery of servicesto people.

The Policies

• Policies help determine the speed,efficiency,and relevance of government services to specific communities and regions

• Policies are guides to thinking in decision-making.They retlect and interpret objectives and guide decisions to achieve the objectives.They establish the framework for planning programs.They establish limits or boundaries to plans which areas planning premises provide the operational background.

• Policies themselves are PLANS.They are also the result of planning and decision-making.

The Procedures

Planning processes can lead to higher productivity, higher accuracy, and faster turnaround for essential business tasks. This lesson will dig into process planning: what it is, why we should do it, and the steps to follow to plan or improve a process.• Steps involved in planning process in Management- Realization of needs setting

goals, developing premises formulating alternatives, alternative analysis, choosing the best alternatives, formulating detail plan of action and converting plan into budget are the main, steps of planning process.

• Realization of needs- It is not compulsory to prepare plan for all the works. We cannot prepare plan to do some activities. So, first of all, an organization needs to determine whether planning is necessary or not.

The Procedures

• Setting goals- If organization need to prepare plan, first of all goal is to be determined. Setting goal is the first step of planning. While setting goal, an organization needs to determine primary objectives, secondary objective, departmental objectives etc. A planner should also consider the market situation and resources.

• Developing premises- A planner needs to find out the essential things for the achieving set objectives. For this purpose, a planner needs to study and analyze the internal and external environment.

• Formulating alternatives- In the fourth step of planning process, planner should formulate various alternatives to analyze and select the best alternatives to achieve the organizational objectives. It is the step of identification of related alternatives.

The Procedures

• Analysis of alternatives- after the identification of alternatives, such alternatives are to be analyzed and evaluated.

• Choosing best alternatives- All the alternatives will not be equally suitable to all the organizations. Planner needs to select the best alternatives.

• Formulating detailed plan of action- A planner has to prepare detailed plan to take decision regarding how, where and why to perform work. Such action plan should play the roles of sub plan.

• Converting plan into budget- "Budget is a financial plan". While preparing budget separate budget is to be prepared as main and departmental budget.

The Procedures

• A Procedure is a document written to support a "Policy Directive". A Procedure is designed to describe Who, What, Where, When, and Why by means of establishing corporate accountability in support of the implementation of a "policy".

• In telecommunications, this is the premise under which a SOP (Standard Operating Procedure) is generated. A SOP is specifically designed to describe and guide multiple iterations of the same procedure over a broad number of locations, on multiple occasions, and over an open period of time until such SOP is updated for whatever reason, or discontinued.

• In telecommunications, this is the premise under which a SOP (Standard Operating Procedure) is generated. A SOP is specifically designed to describe and guide multiple iterations of the same procedure over a broad number of locations, on multiple occasions, and over an open period of time until such SOP is updated for whatever reason, or discontinued.

Forecasting

Forecasting is a process of predicting or estimating the future based on past and present data. Forecasting provides information about the potential future events and their consequences for the organization. It may not reduce the complications and uncertainty of the future.

Forecasting

Steps in Forecasting

1. Analysing and understanding the problem : The manager must first identify the real problem for which the forecast is to be made.

2. Developing sound foundation : The management can develop a sound foundation

3. Collecting and analysing data : Data collection is time consuming.

4. Estimating future events : The future events are estimated by using trend analysis.

5. Comparing results : The actual results are compared with the estimated results.

Forecasting

Importance of Forecasting

Merits, significance or importance of forecasting involves following points:-

1. Forecasting provides relevant and reliable information about the past and present events and the likely future events.

2. It gives confidence to the managers for making important decisions.

3. It is the basis for making planning premises.

4. It keeps managers active and alert to face the challenges of future events and the changes in the environment.

Forecasting

Several Ways of Forecasting:

1. Educated opinion of executives, the experience institutions, estimate, and comparative statistic knowledge of top manager and business owners can be used arrive at an educated guess of future or future market. These are subjective opinions and the executives own fee the environment. These are not exactly precise but usual they prove of immense value to planners.

2. Customers’ appraisals for companies with specialized products or services or with small markets, it is useful to see the opinions of customers. Many industrial products, facilities, telecommunications equipment, and others projected on the basis of what customers indicate they complain about.

3. Delphi survey. This is a series questionnaires sent to experts who are not informed about the participation of each other. Usually, the questions are about future situations or scenarios The experts’ replies and tallied and compared with each other and the cumulative results sent to them again and another round and responses. Changes in the replies are noted until the final summation is made.

Forecasting

4. Experts round table in this method, The experts are brought together in an informal exchange of future scenarios they may provide opinions, judgment’s, studies, or statistics shared/ exchange with each other to arrive at probable trends.

5. Mathematical projections. Statistical and mathematical projections of future sales or future markets, and a series of alternative projections are made so that all possibilities are covered – the worst, the best, or the most reasonable scenarios.

Group 5 Sources:

Ernesto A. Franco, Management in the Philippine Setting

Weinrich, Heinz, Management: A Global and Entrepreneurial Perspective 13th edition

Draft, Richard L., The New Era Of Management: International Edition

Hill, Mcgraw, Principles of Management and Organization

• Michelle Mejos- Leader, Basic Steps in Planning

• Janella Mancenido- The Importance of Planning

• Aira Moises- The Objectives

• Kamille Poblete- The Objectives, Powerpoint

• Ily Magpayo- The Policies

• Arlee Obina- The Policies

• Tricia Mendoza- The Procedures

• Edelyn Mosquera- The Procedures

• Catherine Magat- Forecasting

• Minorca Meija- Forecasting