Management

Thirteenth Canadian Edition

Chapter 9

Planning Work Activities

Copyright © 2022 Pearson Canada Inc.

9-1
Learning Outcomes
1. Define the nature and purpose of planning.
2. Classify the types of goals organizations might have and
the plans they use.
3. Compare and contrast approaches to goal-setting and
planning.
4. Discuss contemporary issues in planning.

Copyright © 2022 Pearson Canada Inc.

9-2
What and Why of Planning? (1 of 3)
Planning
• A management function that involves defining goals,
establishing a strategy for achieving those goals, and
developing plans to integrate and coordinate work activities.

Copyright © 2022 Pearson Canada Inc.

9-3
What and Why of Planning? (2 of 3)
Why do Managers Plan?
• Planning provides direction.
• Planning reduces uncertainty.
• Planning minimizes waste and redundancy.
• Planning establishes the goals or standards.

Copyright © 2022 Pearson Canada Inc.

9-4
What and Why of Planning? (3 of 3)
Relationship Between Planning and Performance
• Formal planning is associated with:
– Higher profits and returns on assets
– Other positive financial results

• The quality of planning and implementation affects

performance more than the extent of planning.
• The external environment can reduce the impact of
planning on performance.
• Formal planning must be used for several years before
planning begins to affect performance.

Copyright © 2022 Pearson Canada Inc.

9-5
Goals and Plans (1 of 4)
Goals and Planning
• Goals (also objectives)
– Desired outcomes or targets.
– Provide direction and performance evaluation criteria.
• Plans
– Documents that outline how goals will be met.
– Describe how resources are to be allocated and
establish activity schedules.

Copyright © 2022 Pearson Canada Inc.

9-6
Goals and Plans (2 of 4)
Types of Goals
• Stated goals: official statements of what an organization
says, and what it wants its stakeholders to believe its goals
are.
• Real goals: goals that an organization actually pursues, as
defined by the actions of its members.

Copyright © 2022 Pearson Canada Inc.

9-7
Exhibit 9.1 Types of Plans

Copyright © 2022 Pearson Canada Inc.

9-8
Goals and Plans (3 of 4)
Types of Plans
• Strategic Plans: plans that apply to the entire organization
and establish the organization’s overall goals.
• Operational plans: plans that encompass a particular
operational area of the organization.
• Long-term plans: plans with a time frame beyond three
years.
• Short-term plans: plans covering one year or less.
• Specific plans: Plans that are clearly defined and leave no
room for interpretation.

Copyright © 2022 Pearson Canada Inc.

9-9
Goals and Plans (4 of 4)
Types of Plans (cont.)
• Directional plans: plans that are flexible and set out
general guidelines.
• Single-use plan: a one-time plan specifically designed to
meet the needs of a unique situation standing plans.
• Ongoing plans: provide guidance for activities performed
repeatedly.

Copyright © 2022 Pearson Canada Inc.

9 - 10
Setting Goals and Developing Plans (1 of 6)
Approaches to Setting Goals
• Traditional Goal Setting: An approach to setting goals in
which top managers set goals that then flow down through
the organization and become subgoals for each
organizational area.
• Goals are intended to direct, guide, and constrain from
above.
• Goals lose clarity and focus as lower-level managers
attempt to interpret and define the goals for their areas of
responsibility.

Copyright © 2022 Pearson Canada Inc.

9 - 11
Setting Goals and Developing Plans (2 of 6)
Approaches to Setting Goals (cont.)
• Means–ends chain: an integrated network of goals in
which the accomplishment of goals at one level serves as
the means for achieving the goals, or ends, at the next
level.
• Management by objectives (MBO): a process of setting
mutually agreed upon goals and using those goals to
evaluate employee performance.
– It consists of four elements: goal specificity; participative
decision making, an explicit time period, and
performance feedback.

Copyright © 2022 Pearson Canada Inc.

9 - 12
Exhibit 9.2 The Downside of
Traditional Goal Setting

Copyright © 2022 Pearson Canada Inc.

9 - 13
Setting Goals and Developing Plans (3 of 6)
Steps in Goal Setting
• Review the organization’s mission, or purpose.
• Evaluate available resources
• Determine the goals individually or with input from others.
• Write down the goals and communicate them to all who
need to know.
• Review results and whether goals are being met.

Copyright © 2022 Pearson Canada Inc.

9 - 14
Exhibit 9.3 Steps in MBO
1. The organization’s overall objectives and strategies are formulated.
2. Major objectives are allocated among divisional and departmental
units.
3. Unit managers collaboratively set specific objectives for their units
with their managers.
4. Specific objectives are collaboratively set with all department
members.
5. Action plans that define how objectives are to be achieved are
specified and agreed upon by managers and employees.
6. The action plans are implemented.
7. Progress toward objectives is periodically reviewed, and feedback is
provided.
8. Successful achievement of objectives is reinforced by performance-
based rewards.

Copyright © 2022 Pearson Canada Inc.

9 - 15
Exhibit 9.4 Well Written Goals
• Written in terms of outcomes rather than actions
• Measurable and quantifiable
• Clear as to a time frame
• Challenging yet attainable
• Written down
• Communicated to all necessary organizational members

Copyright © 2022 Pearson Canada Inc.

9 - 16
Setting Goals and Developing Plans (4 of 6)
Contingency Factors in Planning
• Organizational Level:
– Strategic plans at higher levels.
– Operational plans at lower levels.

• Degree of environmental uncertainty:

– Stable environment: specific plans.
– Dynamic environment: specific but flexible plans.

• Length of future commitments:

– Current plans affecting future commitments must be
sufficiently long-term to meet the commitments.

Copyright © 2022 Pearson Canada Inc.

9 - 17
Exhibit 9.5 Planning and Organizational
Level

Copyright © 2022 Pearson Canada Inc.

9 - 18
Setting Goals and Developing Plans (5 of 6)
Formal Planning Department
• A group of planning specialists whose sole responsibility is
helping to write organizational plans.

Copyright © 2022 Pearson Canada Inc.

9 - 19
Setting Goals and Developing Plans (6 of 6)
Approaches to Planning
• Traditional approach: planning is done entirely by top-
level managers who often are assisted by a formal planning
department.
• Another approach to planning is to involve more
organizational members in the process: plans are not
handed down from one level to the next but instead are
developed by organizational members at the various levels
and in the various work units to meet their specific needs.

Copyright © 2022 Pearson Canada Inc.

9 - 20
Current Issues in Planning (1 of 5)
Effective Planning in Dynamic Environments
• Develop plans that are specific but flexible. Example:
unexpected events such as the COVID-19 pandemic.
• Understand planning is an ongoing process.
• Change plans when conditions warrant.
• Persistence in planning eventually pays off.
• Flatten the organizational hierarchy to foster the
development of planning skills at all organizational levels.

Copyright © 2022 Pearson Canada Inc.

9 - 21
Current Issues in Planning (2 of 5)
Effective Planning in Dynamic Environments (cont.)
Black Swan Events: events that come as a surprise, have a
major effect, and are often inappropriately rationalized after
the fact.

Copyright © 2022 Pearson Canada Inc.

9 - 22
Current Issues in Planning (3 of 5)
How Can Managers Use Environmental Scanning?
• Environmental scanning: Screening information
to detect emerging trends.
• Competitor intelligence: Gathering information
about competitors that allows managers to anticipate
competitors’ actions rather than merely react to them.

Copyright © 2022 Pearson Canada Inc.

9 - 23
Current Issues in Planning (4 of 5)
How Can Managers Use Digital Tools to Assess Their
Environment?
• Business Intelligence: data that managers can use to
make more effective strategic decisions.
• Digital tools: technology, systems, or software that allow
the user to collect, visualize, understand, or analyze data.

Copyright © 2022 Pearson Canada Inc.

9 - 24
Current Issues in Planning (5 of 5)
How Can Managers Use Digital Tools to Assess Their
Environment? (cont.)
• Data Visualization Tools: methods to organize and
summarize data for visual display.
• Cloud Computing: refers to storing and accessing data on
the Internet rather than on a computer’s hard drive or a
company’s network.
• lnternet of Things (IoT): allows everyday “things” to
generate, store, and share data across the Internet.

Copyright © 2022 Pearson Canada Inc.

9 - 25