MAN 3025 Administrative Management Ch. 5

Planning
1. Setting goals and deciding how to achieve them
2. Coping with uncertainty by formulating future courses of action to achieve specified results
Business Plan
A document that outlines a proposed firm’s goals, the strategy for achieving them, and the standards for measuring success
Business Model
Outlines the need the firm will fill, the operations of the business, its components and functions, as well as the expected revenues and expenses
Stategy
A large-scale action plan that sets the direction for an organization
Strategic Management
A process that involves managers from all parts of the organization in the formulation and the implementation of strategies and strategic goals
Planning and Strategic Management
1. Establish the Mission and Vision
2. Assess the current reality
3. Formulate the grand strategy and strategic, tactical, and operational plans
4. Implement the strategy
5. Maintain strategic control
Why Should an Organization Adopt Planning and Strategic Management?
1. Provide direction and momentum
2. Encourage new ideas
3. **Develop a sustainable competitive advantage**
Competitive Advantage
The ability of an organization to produce goods or services more effectively than its competitors do, thereby outperforming them
What Areas Occur During Sustainable Competitive Advantage?
1. Being responsive to customers
2. Innovating
3. Quality
4. Effectiveness
Mission
An organizations purpose or reason for being
Mission Statement
Expresses the purpose of the organization
Vision
A longterm goal describing “what” an organization wants to become. It is a clear sense of the future and the actions needed to get there
Vision Statement
Expresses what the organization should become, where it wants to go strategically
Strategic Planning (Top Management)
They determine what the organization’s long-term goals should be for the next 1-5 years with the resources they expect to have available
Tactical Planning (Middle Management)
Determine what contributions their departments or similar work units can make with their given resources during the next 6-24 months
Operational Planning (First Line Managers)
They determine how to accomplish specific tasks with available resources within the next 1-52 weeks
What are the 3 Levels of Management
1. Top Management
2. Middle Management
3. First-Line Management
Goal
A.K.A: Objective
— A specific commitment to achieve a measurable result within a stated period of time
Means-End Chain
1. Strategic Goals
2. Tactical Goals
3. Operational Goals
Strategic Goals
Set by and for Top-Management and focus on objectives for the organization as a whole
Tactical Goals
Set by and for middle managers and focus on the actions needed to achieve strategic goals
Operational Goals
Set by and for first-line managers and are concerned with short-term matters associated with realizing tactical goals
Action Plan
Course of action needed to achieve the stated goal
Operating Plan
Designed for one year period, defines how you will conduct your business based on the action plan; it identifies clear targets such as revenues, cash flow, and market share
What are the 2 types of plans?
Standing and single use plans
What are the 3 types of standing plans
1. Policy
2. Procedure
3. Rule
What are the 2 single use plans?
1. Program
2. Project
Standing Plans
Plans developed for activities that occur repeatedly over a period of time
Policy
Outlines the general response to a designated problem or situation
Procedure
Outlines the response to particular problems or circumstances
Rule
Designates specific required action
Single-Use Plans
Plans developed for activities that are not likely to be repeated in the future
Program
Encompasses a range of projects or activities
Project
Less scope and complexity than a program
Smart Goal
One that is specific, measurable, attainable, results-oriented, and has target dates.
Results-Oriented
Support an organizations vision
Management by Objectives (MBO)
4 Step Process
1. Managers and Employees jointly set objectives for the employees
2. Managers develop action plans
3. Manager makes a performance appraisal and rewards and employee according to results
4. Managers and employees periodically review the employee’s performance
3 Types of Objectives Used in MBO
1. Improvement Objectives
2. Personal Development Objectives
3. Maintenance Objectives
Cascading
Objectives down through the organization, that is, objectives are structured in a unified hierarchy becoming more specific at lower levels of the organization
Planning/ Control Cycle
2 Planning– 1. Make a plan 2. Carry out plan
a. Correcting deviations in the plan
b. Improving future plans
2 Control—- 3. Control the direction by comparing results with the plan
4. Control the direction by taking corrective action in 2 ways
2 Planning Steps
1. Making the Plan
2. Carry out the Plan
2 Control Steps
1. Control the direction by correcting, and improving
2. Control the direction by comparing the results with the plan
Tactical Planning
Done by middle managers for the next 6-24 months
Operational Plannning
Done by first line managers for the next 1-52 weeks