Je Planning and Performance
Is planning worthwhile? Numerous studies have looked at the relationship between plan-
ning and performance.’ Although most showed generally positive relationships, we can't
‘say that organizations that formally plan aha outperform those that don't plan. What can
‘we conclude?
First, generally speaking, formal planning is associated with positive financial
results—higher profits, higher return on assets, and so forth, Second, it seems that doing
‘2 good job planning and implementing those plans play a bigger part in high performance
than does how much planning is done. Next, in those studies where formal planning
didn’t lead to higher performance, the external environment often was the culprit. When
external forees—think governmental regulations or powerful labor unions—constrain
managers’ options, it reduces the impact planning has on an organization's performance.
nally, the planning-performance relationship seems to be influenced by the planning,
time frame. It seems that at least four years of formal planning is required before it begins
to affect performance.
Goals and Plans
Planning is often called the primary management function because it establishes the bas
forall the other things managers do as they organize, lead, and control. It involves two
important aspects: goals and plans.
LEARNING OUTCOME
Classify the types of goals!
‘orgonizations might have ond.
the plans they use.
‘Scanned with CamSeannerning and performance.’ Although most showed generally positive relationships, we can't
say tha organizations that formally plan always outperform those that don't plan, What can
wwe conclude?
First, generally speaking, formal planing is associated with positive financial
resulis—higher profits, higher turn on assets, and sofort. Second, it seems that doing
«2 good job planning and implementing those plans pay a bigger part in high performance
than does how much planning is done. Nex, in those studies where formal planning