Planning

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Planning

• Module 4
• LIS 580 Spring, 2006
• Instructor- Michael Crandall

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Roadmap

• Purpose of planning
• The planning process
• Setting objectives
• Building planning premises
• Developing plans
• Types of plans
• Planning pitfalls

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Purpose of Planning
Because of changes in the environment
Set the standards to facilitate control
Provide direction
Managers engage in planning to
Minimize waste and redundancy
Reduce the impact of change
Prentice Hall, 2002
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Elements Of Planning

• Plan
• A method for doing or making something,
  consisting of at least one goal and a predefined
  course of action for achieving that goal.
• Goal
• A specific result to be achieved the end result
  of a plan.
• Objectives
• Specific results toward which effort is directed.

G.Dessler, 2003
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Elements Of Planning (contd)

• Planning
• The process of setting goals and courses of
  action, developing rules and procedures, and
  forecasting future outcomes.
• What Planning Entails
• Choosing goals and courses of action and deciding
  now what to do in the future to achieve those
  goals.
• Assessing today the consequences of various
  future courses of action.

G.Dessler, 2003
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What Planning Accomplishes

• Allows decisions to be made ahead of time.
• Permits anticipation of consequences.
• Provides direction and a sense of purpose.
• Provides a unifying framework avoiding piecemeal
  decision making.
• Helps identify threats and opportunities and
  reduces risks.
• Facilitates managerial control through the
  setting of standards for monitoring and measuring
  performance.

G.Dessler, 2003
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The Management Planning Process

• Hierarchy of Plans
• A set of plans that includes the company-wide
  plan and the derivative plans of subsidiary units
  required to help achieve the enterprise-wide
  plan.
• Top management approves a long-term plan and
  each department creates its own budgets
• The Planning Hierarchy
• Top management formulates its plans based on
  upward feedback from the departments, and the
  departments in turn draft plans that make sense
  in terms of top managements plan.

G.Dessler, 2003
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Hierarchy of Goals
FIGURE 41
G.Dessler, 2003
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Who Does the Planning?

• Small businesses
• Entrepreneurs do most of the planning.
• Large firms
• Traditional
• A central corporate planning group works with top
  management and each division to solicit,
  challenge, and refine the companys plan.
• Current
• Planning is decentralized and includes the firms
  product and divisional managers, aided by small
  headquarters advisory groups.

G.Dessler, 2003
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Checklist 4.1How to Develop a Plan

• Set an objective.
• Develop forecasts and planning premises.
• Determine your options.
• Evaluate alternatives.
• Choose your plan, and start to implement it.
• Go to Level 2.

The decision- making process
G.Dessler, 2003
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Setting Objectives
G.Dessler, 2003
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Checklist 4.2 Principles of Goal-Setting

• Set SMART goalsmake them specific, measurable,
  attainable, relevant, and timely. Choose areas
  (sales revenue, costs, and so forth) that are
  relevant and complete.
• Assign specific goals.
• Assign measurable goals.
• Assign doable but challenging goals.
• Encourage participation.
• Use executive assignment action plans, or
  management by objectives.

G.Dessler, 2003
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Forecasts and Planning Premises

• Forecasting is used to predict future
  requirements and opportunities
• Determines the premises on which planning is
  based
• Can be quantitative (e.g., a time series) or
  qualitative (e.g., jury of executive opinion)
• Marketing research
• Competitive intelligence
• Helps build the picture of what others are doing
  to inform the planning process
• Next step is the decision-making process we
  talked about yesterday
• Finally, you begin to build your plans (usually
  more than one to realize objectives)

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The Business Plan And Its Components

• Description of the business (including ownership
  and products or services)
• Marketing plan
• Financial plan
• Management
• and/or personnel plan.

G.Dessler, 2003
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Outline of a Marketing Plan
Source Adapted from Philip Kotler and Gary
Armstrong, Principles of Marketing (Upper Saddle
River, NJ Prentice Hall, 2001), p. 70.
FIGURE 43
G.Dessler, 2003
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Acmes Potential Market Segments
FIGURE 44
Source Business Plan Pro, Palo Alto Software,
Palo Alto, CA.
G.Dessler, 2003
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Product, Pricing, and Sales Forecasts
FIGURE 45
Source Business Plan Pro, Palo Alto Software,
Palo Alto, CA.
G.Dessler, 2003
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Personnel Plan
FIGURE 46
Source Business Plan Pro, Palo Alto Software,
Palo Alto, CA.
G.Dessler, 2003
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Sales Forecast by Service Two-Month Sales Plan
for Acme Consulting, 2003
FIGURE 47
G.Dessler, 2003
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Gantt Scheduling Chart for Acme Strategic Report
Projects, Jan 115, 2003
FIGURE 48
G.Dessler, 2003
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Acme Consulting Profit and Loss
Source Business Plan Pro, Palo Alto Software,
Palo Alto, CA.
FIGURE 49
G.Dessler, 2003
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G.Dessler, 2003
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G.Dessler, 2003
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Types of Plans
Type of Plan Time Frame Specificity Frequency of Use
Strategic Long Term Directional Single Use
Tactical Short Term Specific Standing
Operational Ongoing Very detailed Day-to-day
Policies, procedures, and rules Varies Varies Varies
G Dessler, 2003
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Reporting Improper Behavior
Source James Jenks, The Hiring, Firing (and
everything in between) Personnel Forms Book
(Ridgefield, CT Round Lake Publishing, 1996),
pp. 22425.
FIGURE 410
G.Dessler, 2003
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Pitfalls of Planning

• Planning may create rigidity
• Plans cannot be developed for a dynamic
  environment
• Formal plans cannot replace intuition and
  creativity
• Planning focuses managers attention on todays
  competition, not tomorrows survival
• Formal planning reinforces success, which may
  lead to failure

Prentice Hall, 2002
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Elmer L. Anderson Library

• What did the planners do right in this effort?
• Was the design a result of research or
  creativity?
• How was the planning process affected by
  stakeholder needs?
• How much of the planning was related to political
  activities and how much to actual construction
  activity?
• How was success measured for the project?

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Extreme Chaos

• Better project success rates due to lower costs
  and smaller projects
• Difficulty of estimating costs and schedules
  accurately
• Often tripled up front to avoid failure
• Old metrics not appropriate to modern methods
• Difficult to establish benchmarks
• Different skills for different roles

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Project Success Factors
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Next Time

• Strategic planning
• Read Chapter 5 and Cleveland Public Library
  Strategic Plan
• Discussion questions
• How has the Gold Coast City Council been able to
  use evidence to aid in strategic planning?
• Do you think their choice of benchmarks will
  achieve the overall objectives?
• Are there any risks in using these measures in
  deciding on long-term changes in structure?
• Do you think the library staff is engaged in this
  process? Should they be?