WEEK 3: PLANNING

TOPIC

 DEFINE PLAN AND PLANNING

PLANNING AT VARIOUS MANAGEMENT

LEVEL TYPES OF PLAN
 IMPORTANCE OF PLANNING
IN THE INDUSTRY

 PLANNING PROCESS

 MAKING PLANNING EFFECTIVE

EXPECTED COMPETENCIES

Upon completing this Learning Module, student will be able to:

1. Define planning and its importance to the industry

2. Identify types of planning at different management level
3. Illustrate the various types of plans
4. Describe planning process and how to make it effective
5. Create an example of individual strategic plan

INTRODUCTION

One of engineer-managers duty is to determine the organization’s

future and success and how to achieve it. Manager’s ability to plan
can help in implementing right decision.
Regardless of the level of the management, the engineer-manager
will have to create a plan for his area or department. The higher
the position of the manager the more complex the plan that he
should make.
PLAN AND PLANNING

DEFINED

According to Merriam Webster’s dictionary, a goal is “the end toward which effort is
directed.” Goals are important, they are identified and specified for the operations to
exist.

A Plan is a blueprint for achieving the target and sets out the appropriate allocations of
resources, schedules, tasks, and other actions. It serves as a reference to achievement of
the goal.

According to Cole and Hamilton, planning is "deciding what will be done, who will do
it, where, when and how it will be done, and the standards to which it will be done.”²
Planning as define, provides a better guide to effectively implement activities for target
to be achieve.
LEVELS OF PLANS AND GOAL

The different level of management corresponds to the different plans the manager should make.
Below is a presentation of different level of plans and their importance
Figure 1: Different Levels of Plans
The planning commences from organization’s mission which defines its basic purpose, for external
audience. The mission serves as the basis for developing the strategic goal which in turn formulate
tactical and operational goal. Top management such as CEO, President and Chairman are
responsible for the strategic plan where organization’s objective is indicated.

Strategic planning according to Nickels and others, “refers to the process of determining the
major goals of the organization and the policies and strategies for obtaining and using resources to
achieve those goals.”

Tactical or Intermediate plan is developed by middle management managers. Functional

managers or department heads are some of them.

Operational plans describe the basic procedures or processes

necessary at lower organizational levels. Operational planning refers to the process of determining
how specific tasks can best be accomplished on time with available resources.

Front-line managers and supervisors create operational plans which focus on specific tasks and
processes and help meet tactical and supervisory needs. Planning at various level supports the
other level to accomplish the organizational targets.
FIGURE 2: PLANNING AT DIFFERENT LEVEL OF ORGANIZATION

Strategic Plan

Intermediate
Plan

Operational
Plan Supervisors
TYPES OF PLANS

Plans are classified into various types. Below is the list of different types of
plan:

1. Functional Area Plans

- These plans are prepared by the different functional areas who needs it

a. Marketing Plan

b. Production plan

c. Financial Plan

d. Human resource plan

2. Plans with Time Horizon:

a. Short-range plans – are plans to cover a period of less than a year.

b. Long-range plans – these are plans which cover a period of more than oneyear.

3. Plans According to Frequency Use

a. Standing Plans - these are plans that are used again and again and they focus on repeatedly
recurring managerial situations
 Policies
 Procedures
 Rules

c. Single-Use Plans - these plans are designed primarily to incorporate steps that are new and
unlikely to be replicated
 Budget
 Program
 Project
PURPOSE OF PLANNING

An article presented by C.W. Roney, explains that organizational planning has two different
purposes: the protective and the affirmative.

Protective purpose of planning is to minimize risk by reducing the uncertainties surrounding

business conditions and clarifying consequences of related management actions.

The affirmative purpose is to increase the degree of organizational success. Firms may vary on
how they look at their plan. Planning is also used to link all the activities within the organization.
But the basic purpose of planning is to help the organization in achieving its objective.

PLANNING PROCESS

Different level of management may have different process for planning. But the common process
can be illustrated below:
FIGURE 3: THE PLANNING PROCESS
Setting Plan / Organizational Goal

Planning process begins with the goal setting. The engineer manager clearly defines the mission,
vision, target and direction of the firm. Goal can either be for the whole organization, for a certain
department or a specific area or section. When setting up the goal the engineer manager must
consider the following:

 Specific and measurable

 Defined time period
 Cover key result areas
 Challenging but realistic
 Linked to rewards

Example of goals are:

 increase of revenue by 30% for the fiscal year

 Decrease of carbon footprints by 10% produce by the firm by the end of 2 nd quarter
 improvement of change over rate for model 12345 within 3 months and so on
Strategy and Tactics Development

Once the organizational goal is identified, the next step is to develop strategies and tactics that
would aid in realizing those goals. Strategical map and tactical plans are carried out in these
processes. Contingency plan is also created to effectively respond to an unforeseen circumstance.

Example of strategies are:

 modify number of product model to increase number of customers

 implement recycling program for reduction of carbon footprints
 apply one box set-up to decrease change over time

Short term actions such as customer survey and leasing a business office for acertain project are
examples of tactics.

Determining Resources Needed

Factors needed for goal realization are identified, this may include the human and non-human
resources. Resources should be properly determined (quantity and quality) to avoid excess or
shortage cost in implementing the strategies and tactics.
Example of resource determination are:

 allocation of 5 million for the production line of the new model

 purchasing of 20 new machines and equipment for installation in the new production line
 hiring of additional 25 operators

Implementation of Plan

After resources are identified, the next step is to implement the plan. Tools to execute the strategy
include management by objective, results dashboards, and unified transparency

Many companies have adapted management by objectives in the implementation of goals because
they believe that they are well-oriented when they use it. According to Peter F. Drucker,
Management by Objective (MBO) “is a system used by managers to define goals and use them
to monitor subsequent performance.”

Performance dashboards are most of the time use to track the effectiveness of the implemented
activities. Dashboards varies depending on the area it will be use.
They are also used to view the real time process.
Review and Monitor

Lastly, managers frequently review plans to learn from outcomes and change plans as necessary
as possible if needed. Planning and operational reviews are normally done during this process.

MAKING PLANNING EFFECTIVE:

Organizational goals are achieved once planning is effective. But sometimes plan doesn’t work
out the way they are planned. So, to make planning successful, the engineer-manager should
observe the following:

 Know the different barriers to planning. Planning barriers may include the following:
1. Manager’s planning ability is not suitable
2. Planning process is incorrect
3. Members are not engaged to the planning process
4. Gathered information are inappropriate
5. Too much focus on the present at the cost of the future
6. Dependent on the planning department

7. More focused on the controllable variable

  Use of aids in planning

Planning aids may include but not limited to, involving member in the planning process,
gathering of more and appropriate information and to develop different information
sources.

PLANNING TOOLS:

There are many planning tools available that the managers can use. Two of these common tools
are:

 Forecasting - is the method of forecasting potential environmental conditions that will

affect the activity of the organization

Types of Forecasting:

 Qualitative
 Quantitative
 Scheduling - process of drawing up a comprehensive list of the tasks to be carried out in
order to achieve the objective, the allocation of the resources required to achieve the
objective, and the development and follow-up of timetables for the achievement of the
objective

o Gantt Chart

o PERT
Thank you