Ch05 Daft Planning Nad Goal Setting

Organizational
Planning
& Goal Setting
Developed by Cool Pictures & MultiMedia Presentations Copyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved.
Goals and Plans
Goal
A desired future state that the organization attempts to
realize.
Plan
A blueprint specifying the resource allocation, schedules,
and other actions necessary for attaining goals.
Planning is considered the most fundamental function.
Planning is the most controversial management function.
Levels of Goals/Plans
Goals and Plans Purposes
Legitimacy/Mission Statement Inside Motorola
What the organization stands for.

Describes values, aspirations, and reason for being.
Focuses on, customers, corporate values, product quality, and attitude toward employees.
Source of Motivation and Commitment

Facilitate employees’ identification with the organization.
Guides to Action Standard of Performance

Provide a sense of direction. Serve as performance criteria.
Focus attention on specific targets. Provide a standard of assessment.
Direct efforts toward important outcomes.
Peter Drucker’s Eight Content
Areas in Developing Goals
Marketing.
Innovation.
Productivity.
Physical and financial resources.
Profitability.
Managerial performance and development.
Worker performance and attitude.
Public responsibility.
Overall Planning Process
Begins With:  Mission statement

 Strategic goals
Goals and Plans
Strategic Goals
• Where the organization wants to be in the future.
• Pertain to the organization as a whole.
Strategic Plans
• Action Steps.
• Blueprint that defines the organizational activities and
resource allocations.
Tactical Goals and Plans
Tactical Goals
Goals that define the outcomes that major divisions
and departments must achieve.
Tactical Plans
Plans designed to help execute major strategic plans.
Operational Goals and Plans
Operational Goals
Specific, measurable results expected from
departments, work groups, and individuals.
Operational Plans
Organization’s lower levels that specify action
steps toward achieving operational goals.
Planning Time Horizon
Means End-Chain
• The achievement of goals at low levels

permits the attainment of high-level goals.
Characteristics of
Effective Goal Setting
Goal Characteristics
Specific and measurable.

Cover key result areas.
Challenging but realistic.
Defined time period.
Linked to rewards.
Model of the MBO Process
Step 1: Setting Goals Step 2: Developing Action Plans
Corporate Strategic Goals

Departmental Goals Action Plans
Individual Goals
Review Progress
Step 3:
Reviewing Progress
Corrective Action
Appraisal of Overall Performance
Step 4: Appraising Overall

Performance
MBO Benefits and Problems
Benefits of MBO Problems with MBO

1. Manager and employee efforts are 1. Constant change prevents MBO from
focused on activities that will lead to taking hold.
goal attainment.
2. An environment of poor employer-
2. Performance can be improved at all employee relations reduces MBO
company levels. effectiveness.
3. Employees are motivated. 3. Strategic goals may be displaced by
4. Departmental and individual goals operational goals.
are aligned with company goals. 4. Mechanistic organizations and values that
discourage participation can harm the
MBO process.
5. Too much paperwork saps MBO energy.
Plans
Single-Use
Standing
Contingency
Crisis Management
Three Stages
 Prevention
 Preparation
 Containment
The New Planning Paradigm
Planning
Still Starts
Use and Stops at
Temporary the Top Start with
Task Forces a Strong
Mission
Six Rules of
Planning
Design
New Roles
Create an Set Stretch
for
Environment Goals
Planning
that
Staff
Encourages
Learning
Strategic Management Questions
 What changing and trends are occurring?

 Who are the customers?
 What products or services should we offer?
 How can we offer these products or
services efficiently?
Strategic Management Process
Scan External
Identify Strategic
Environment
Factors
•National •Opportunities
•Global •Threats
Implementing Strategy
Identify
Evaluate Current: Define New: via Changes in:
•Mission •Mission Strategic: •Structure
SWOT
•Goals •Corporate
•Goals •Human resources
•Strategies •Business
•Grand Strategy •Information &
•Functional control systems
Scan Internal Identify Strategic

Environment Factors
•Core •Strengths
Competence
•Weaknesses
•Synergy
•Value Creation
Porter’s Competitive Forces
Threat of substitute products

Potential new entrants
Rivalry among competitors
Bargaining power of buyers
Bargaining power of suppliers
The Five Forces Affecting Industry
Competition
SOURCES: Based on Michael

E. Porter, Competitive
Strategy: Techniques for
Analyzing Industries and
Competitors (New York: Free
Press, 1980); and Michael E.
Porter, “Strategy and the
Internet,” Harvard Business
Review (March, 2001), 63-78.
Competitive Strategies
1. Differentiation
2. Cost Leadership
3. Focus
Partnership Strategies
“Collaboration”
High
Organizational Acquisitions
Combination
Mergers
Degree of
Collaboration Joint Ventures
Strategic
Alliance
Strategic Business Partnering
Preferred Supplier Arrangements

Low
Source: Adapted from Roberta Maynard. “Striking the Right March,” Nation’s Business (May 1996), 18-28.
Tools for Putting
Strategy into Action
SOURCE: Adapted from Jay R. Galbraith and Robert K. Kazanjian, Strategy Implementation: Structure, Systems, and Process, 2d ed. (St. Paul, Minn.: West, 1986), 115. Used
with permission.

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Organizational

Legitimacy/Mission Statement Inside Motorola

What the organization stands for.

Source of Motivation and Commitment

Guides to Action Standard of Performance

Begins With:  Mission statement

• The achievement of goals at low levels

Specific and measurable.

Corporate Strategic Goals

Step 4: Appraising Overall

Benefits of MBO Problems with MBO

 What changing and trends are occurring?

Scan Internal Identify Strategic

Threat of substitute products

Bargaining power of buyers

Bargaining power of suppliers

SOURCES: Based on Michael

Preferred Supplier Arrangements

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