Basic Elements of

Planning and Decision

Making
Planning and the planning process
 Planning: setting an organization’s
goals and deciding how best to achieve
them.
 It’s a generic activity

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Continued…
The Environmental Context

The organization’s mission

• Purpose • Premises • Values • Directions

Strategic goals Strategic plans

Tactical goals Tactical plans

Operational goals Operational plans

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Organizational Goals
 Purpose of Goals
 Provide guidance and a unified direction for
people in the organization.
 Have a strong effect on the quality of other
aspects of planning.
 Serve as a source of motivation for employees of
the organization.
 Provide an effective mechanism for evaluation
and control of the organization.

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Kinds of Goals
 Goals by level:
 Mission: a statement of an organization’s
fundamental purpose.
 Strategic goal: goals set by and for top
management of the organization that address
broad, general issues.
 Tactical goal: goals set by and for middle
managers; their focus is on how to
operationalize actions to strategic goals.
 Operational goals: goals set by and for lower-
level managers to address issues associated with
tactical goals.

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Continued…
 By area
 By time frame:
 Long term
 Intermediate term
 Short term
May be explicit or open-ended
Varies by level
Responsibilities for setting goals
Optimizing: balancing and reconciling possible conflicts
among goals

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Organizational Plans
 Kinds of organizational plans
 Strategic plan: A general plan outlining
resource allocation, priorities, and action
steps to achieve strategic goals. The plans
are set by and for top management.
 Tactical Plans: A plan aimed at achieving the
tactical goals and is developed to implement
parts of a strategic plan.
 Operational Plans: Plans that have a short-
term focus. These plans are set by and for
lower-level managers to carry out tactical
plans

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Responsibilities for Planning
 Planning staff
 Planning task force
 Board of directors
 CEO
 Executive committee
 Line management

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Contingency planning
 Contingency is the determination of alternative courses
of action to be taken if an intended plan is unexpectedly
disrupted or rendered inappropriate. These plans help
managers to cope with uncertainty and change.
Ongoing planning process

Action point 1 Action point 2 Action point 3 Action point 4

Develop plan, Implement plan and Specify indicators Successfully complete
considering formally identify for the contingency plan or contingency
contingency events contingency events events and develop plan
contingency plans for
each possible event

Monitor contingency event indicators and

implement contingency plan if necessary

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Tactical planning
 Developing and Executing Tactical Plans
Developing tactical plans
• Recognize and understand
overarching strategic plans
and tactical goals
• Specify relevant resource and
time issues
• Recognize and identify human
resource commitments
11/14/09 S. M. Towhidur Rahman
Executing tactical plans
• Evaluate each course of action
in light of its goal
• Obtain and distribute
information and resources
• Monitor horizontal and vertical
communication and integration
of activities
• Monitor ongoing activities for
goal achievement
10
Operational Planning
Plan Description
Single-use plan Developed to carry out a course of action not likely to
be repeated in the future
Program Single-use plan for a large set of activities
Project Single-use plan of less scope and complexity than a
program

Standing plan Developed for activities that recur regularly over a

Policy
Standard operating procedure
Rules and regulations
period of time
Standing plan specifying the organiz ation’s general
response to a designated problem or situation Mc Donald
Standing plan outlining steps to be followed in
particular circumstances
Standing plans describing exactly how specific
activities are to be carried out

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Barriers to Goal Setting &
Planning
 Inappropriate goals
 Improper reward system
 Dynamic and complex environment
 Reluctance to set goals
 Resistance to change
 constraints

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Overcoming the barriers
 Understand the purpose of goals and
plans
 Communication and participation
 Consistency, revision and updating
 Effective reward systems

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Management by Objective (MBO)
 The process to collaborative goal setting by a
manager and subordinate; the extent to which goals
are accomplished is a major factor in evaluating and
rewarding the subordinate’s performance.

 The nature and purpose of MBO:

The purpose of MBO is to give subordinates a voice
in the goal setting and planning process and to clarify
for them exactly what they are expected to
accomplish in a given time span. MBO is concerned
with goal setting and planning for individual managers
and their units or work groups.

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The MBO process
 Starting the MBO program
-it must start at the top of the organization
-employee must also be educated about what MBO is, what they think
it will do.
-manager must implement it in a way that is consistent with overall
organizational goals
 Collaborative goal setting and planning
Manager tell their subordinates what org. and unit goals and plans top
management has established
Manager meeting with their subordinates on a one-to-one basis to
arrive at a set of goals and plans
the goals are refined to be as verifiable as possible and to specify a
time frame for their accomplishment
Role of counselors Workable and attainable
Spell out the resources
 Periodic review
 Evaluation

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