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11 Cards in this Set
- Front
- Back
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Planning is the starting point in any management process and has two components: |
The activities involved in determining the organisation's goals and showing the way forward (the plan)
How to achieve these goals. |
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The tasks of a manager can be depicted graphically as follows: |
It is only for the purpose of studying the work of a manager that we distinguish between the different tasks of the manager (planning, organising, leadership and control). |
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Some of the main reasons why we need to do planning as part of the management process. |
Planning gives direction to the organisation in the form of goals and plans. It provides the road map telling the organisation where to go and how to get there.
Planning helps to get the different functional areas to work together. It provides information to the production people on how many units to manufacture, it informs the marketing section about their job (ie to create a demand for the product and to facilitate the process of selling the product) and it gives the financial section a better idea about capital needs and cash flow required to run the business properly. So we can say that planning helps with the coordination, cohesion and stability of theorganisation. Planning forces the organisation to take a hard look at what the future holds for theorganisation. Many managers get so involved in the day-to-day running of the business that they tend to forget about the future. There is an old saying that nothing in the future will be the same as it is today! This holds true for any business. One of the most dramatic changes that we see in the business world is of course the rise in technology. Technological changes are happening rapidly and the organisation must look to the future, anticipate changes and reflect on how they will influence the business. |
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When setting goals, management must consider the following general guidelines. |
First, it is important to recognise that goals provide guidance to the organisation; they must be the road map used by every worker in the organisation.
Second, goals must be measurable; if they are not quantifiable then they cannot be controlled. Third, the responsibility for attaining goals must be assigned to specific people in the organisation. Fourth, goals must be set consistently so that the different functional areas work together. Finally, there must be buy-in of the goals set, meaning that every worker must be informed and motivated to attain the set goals. This further means that the remuneration system must be set in such a manner that there is an incentive for workers to reach these goals. |
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Management by objectives (MBO) |
Management by objectives (MBO) is a goal-setting technique whereby managers and employees jointly define goals for the business.
The most obvious advantage of this approach is that employees have a say in setting goals, which also improves worker motivation, as they have been part of the process. |
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The planning process consists of various activities: |
Goal-setting which takes into consideration the mission of the organisation,
The development of plans based on the information obtained from the environmental scan The implementation of the plan by means of the other management90functions (organising, allocation of resources, leading and exercising control). |
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It is important to remember this regarding planning: |
Planning is not a static process, but a dynamic one. This means it is a process that never stands still; nor can it remain the same. Plans should be reviewed at regular intervals and then adjusted (if necessary) to adapt to changing needs and circumstances (the feedback loop).
Planning is the foundation on which the other management tasks rest. It is important for you to understand how planning is interlinked with the other management tasks. If planning is not done properly, it will have a detrimental effect on how the organising, leading and control tasks are performed. |
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The mission |
The mission of the organisation refers to the purpose as set out by the management of the organisation.
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The business environment |
The business environment has been discussed previously and we will not go into detail about the dynamic environment in which organisations operate.
Obviously management must consider the environment in which the organisation operates when determining the goals of the organisation. It is very difficult for management to keep track of all the changes in the dynamic business environment. |
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Also influence goals |
The experience of management also plays a role in the determination oforganisational goals. Management's values also influence the goals. |
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We distinguish between three types of goals: |
The strategic or long-term goals. These goals and plans to achieve them are set by top management and are future-oriented with a timeframe of three to ten years. The plans to achieve these goals focus on the organisation as a whole. Various long-term plans can be developed by top management, among other things market development such as done by
The tactical or functional goals. These goals are determined by middle management and cover a period ranging from one to three years. The operational or short-term goals. These are set by lower-level manage- ment and cover a maximum period of one year. |
