MANAGEMENT
Planning Work Activities
We begin our study of the first of the management functions: planning. Planning is important because it
establishes what an organization is doing. We’ll look at how managers set goals as well as how they
establish plans.
INTRODUCTION
Planning is one of the four functions of management. We have discussed the nature and purposes of
planning, strategies for effective planning, and contemporary planning issues.
8.1. THE WHAT AND WHY OF PLANNING
Planning involves defining the organization’s goals, establishing an overall strategy for achieving these
goals, and developing plans for organizational work activities.
Why Do Managers Plan? Planning serves a number of significant purposes.
• gives direction to managers and nonmanagers of an organization
• reduces uncertainty
• minimizes waste and redundancy
• establishes goals or standards used in controlling
Planning and Performance
Although organizations that use formal planning do not always outperform those that do not plan, most
studies show positive relationships between planning and performance.
• Effective planning and implementation play a greater part in high performance than does the
amount of planning done.
• Studies have shown that when formal planning has not led to higher performance, the external
environment is often the reason.
8.2. GOALS AND PLANS
Planning is often called the primary management function because it establishes the basis for all other
functions. Planning involves two important elements: goals and plans.
Types of Goals:
Goals (often called objectives) are desired outcomes for individuals, groups, or entire organizations.
• Financial goals versus strategic goals
• Stated goals versus real goals
o Stated goals are official statements of what an organization says and what it wants its
various stakeholders to believe its goals are.
o Real goals are those that an organization actually pursues, as defined by the actions of its
members.
Types of Plans:
Plans are documents that outline how goals are going to be met. Can be described by their breadth, time
frame, specificity, and frequency of use
• Breadth: Strategic versus operational plans. Strategic plans (long-term plans) are plans that
apply to the entire organization, establish the organization’s overall goals, and seek to position
the organization in terms of its environment. Operational plans (short-term plans) are plans
that specify the details of how the overall goals are to be achieved.
• Time frame: Short-term versus long-term plans. Short-term plans are plans that cover one year
or less. Long-term plans are plans with a time frame beyond three years.
• Specificity: Specific versus directional plans. Specific plans are plans that are clearly defined and
leave no room for interpretation. Directional plans are flexible plans that set out general
guidelines.
• Frequency of use: Single-use versus standing plans. A single-use plan is a one-time plan
specifically designed to meet the needs of a unique situation. Standing plans are ongoing plans
that provide guidance for activities performed repeatedly.
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Planning Work Activities
We begin our study of the first of the management functions: planning. Planning is important because it
establishes what an organization is doing. We’ll look at how managers set goals as well as how they
establish plans.
INTRODUCTION
Planning is one of the four functions of management. We have discussed the nature and purposes of
planning, strategies for effective planning, and contemporary planning issues.
8.1. THE WHAT AND WHY OF PLANNING
Planning involves defining the organization’s goals, establishing an overall strategy for achieving these
goals, and developing plans for organizational work activities.
Why Do Managers Plan? Planning serves a number of significant purposes.
• gives direction to managers and nonmanagers of an organization
• reduces uncertainty
• minimizes waste and redundancy
• establishes goals or standards used in controlling
Planning and Performance
Although organizations that use formal planning do not always outperform those that do not plan, most
studies show positive relationships between planning and performance.
• Effective planning and implementation play a greater part in high performance than does the
amount of planning done.
• Studies have shown that when formal planning has not led to higher performance, the external
environment is often the reason.
8.2. GOALS AND PLANS
Planning is often called the primary management function because it establishes the basis for all other
functions. Planning involves two important elements: goals and plans.
Types of Goals:
Goals (often called objectives) are desired outcomes for individuals, groups, or entire organizations.
• Financial goals versus strategic goals
• Stated goals versus real goals
o Stated goals are official statements of what an organization says and what it wants its
various stakeholders to believe its goals are.
o Real goals are those that an organization actually pursues, as defined by the actions of its
members.
Types of Plans:
Plans are documents that outline how goals are going to be met. Can be described by their breadth, time
frame, specificity, and frequency of use
• Breadth: Strategic versus operational plans. Strategic plans (long-term plans) are plans that
apply to the entire organization, establish the organization’s overall goals, and seek to position
the organization in terms of its environment. Operational plans (short-term plans) are plans
that specify the details of how the overall goals are to be achieved.
• Time frame: Short-term versus long-term plans. Short-term plans are plans that cover one year
or less. Long-term plans are plans with a time frame beyond three years.
• Specificity: Specific versus directional plans. Specific plans are plans that are clearly defined and
leave no room for interpretation. Directional plans are flexible plans that set out general
guidelines.
• Frequency of use: Single-use versus standing plans. A single-use plan is a one-time plan
specifically designed to meet the needs of a unique situation. Standing plans are ongoing plans
that provide guidance for activities performed repeatedly.
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