CHAPTER 8

The Manager as a
Planner
and Strategist
 Learning Objectives
LO Understand what is Planning, Planning Steps, and the
Importance of planning.

LO Understanding Characteristics/Criterion of Effective

Planning & the meaning of a Rolling Plan.

LO Classify Planning according to Time Horizon.

LO Differentiate between Corporate-Level Planning,

Divisional-level Planning, and Operational-level planning
steps and strategies.

LO Differentiate between Types and Components of

Operational Plans.
Mission statement
• A broad statement that declares an organization’s
purpose that identifies the organization’s products
and customers and distinguishes the organization
from its competitors

Products Customers Distinction

 Why Planning Is Important
Direction Participation Coordination Controlling
Device

Deciding and Managers Coordinatio Controlling

unifying the Participation n of Device -
Direction in Decision- Information Means to
making measure
performance
What are the Characteristics of Effective
Planning? Henri Fayol
Characteristics of Effective Planning - UCAF

Unity Continuity

Accuracy Flexibility
Unity
• Planning is cascaded
throughout the
organizations
• All Goals + Strategies
+ PAR are all
connected
• Resulting in one
central plan that
contains all the lower
level plans
Continuit
y
• Not a one day or a
week effort
• Its an on-going
process
• Due to the constant
changes in the internal
and external
environments
Flexibilit
y
• Due to the constant
changes in the internal
and external
environments
• Managers should be
able to change/ alter
plans are required
• So planning is not
rigid
Accuracy
• Based on information

• That is correct (verified)

 Rolling Plan
• rolling plan is a plan
that is continuously Continuity
revised and amended to
take into consideration
that the changes that
are happing or will
happen in the internal
Flexibility
and external
environments.
 Time Horizon of Plans

Time Horizon is the duration of the

plans/planning.

Period of time over which plans are intended to

apply or endure
 Time Horizons of Plans

Usually, there are 3 types of time horizon

Short -t erm I nt ermediat e Long-t erm

A year or less More t han a year but less t han 5 years 5 or more years

Short-term plans are less than 1 year.

Intermediate-term plans are 1 to 5 years.
Long-term plans are usually 5 years or more.
 Corporation Definition

A large company or
group of companies
authorized to act as a
single entity and
recognized as such in
law.
Corporate + Business + Operational
Levels

Corporate Level

Also called Group-level

Business Level or Organizational-level

Also called
Divisional-level or
Business Unit level Functional Level

Also called
Department-level
Operational-level
 Corporate-Level Planning

1.Decide corporate goals.

2. Formulate corporate strategies.

3. Implement corporate strategy

= Allocate corporate resources
= Design Corporate structural control
Business-Level Planning

1.Decide business goals.

2. Formulate business strategies.

3. Implement business strategy

= Allocate business resources
= Design business structural control
 Functional-Level Planning

1.Decide departmental goals.

2. Formulate departmental strategies.

3. Implement departmental strategy

= Allocate departmental resources
= Design departmental structural control
Levels and Types of Planning
CORPORTE-LEVEL PALNNING BUSINESS-LEVEL PALNNING FUNCTIONAL-LEVEL PALNNING
 Corporate Level
Planning

1.Decide corporate goals.

A plan that indicates in

2. Formulate corporate which industries
strategies. and markets an
organization intends to
3. Implement corporate compete
strategy
= Allocate corporate
resources
= Design Corporate
structural control
 Business Level
Planning

outlines the specific

1.Decide business goals. methods a
division, business
business
2. Formulate unit, will use to
compete
strategies.
effectively
3. Implement business strategy against its rivals in
= Allocate business an industry
resources
= Design business structural
control
 Functional Level
Planning
A planof action
to improve the
1.Decide departmental goals. ability of each of an
organization’s
Functional
2. Formulate
functions to perform
its task-specific
strategies. activities in ways
3. Implement departmental strategy that add value to an
= Allocate departmental resources organization’s goods
= Design departmental structural and services
control
 Types of Planning Levels
Corporate-level planning
• Top management’s decisions pertaining to the organization’s mission and goals, overall
strategy, and structure.

Business-level planning
• Long-term divisional goals that will allow the division to meet
corporate goals
• Division’s business-level strategy and structure to achieve divisional
goals

Functional-level planning
• Goals that the managers of each function will pursue to help their
division attain its business-level goals
• Functional -level strategy and structure to achieve functional goals
 Types of Strategies
Corporate-level strategy
• A plan that indicates in which industries and national markets an
organization intends to compete

Business-level strategy
• This strategy outlines the specific methods a division, business unit will
use to compete effectively against its rivals in an industry

Functional strategy
• A plan of action to improve the ability of each of an organization’s
functions to perform its task-specific activities in ways that add value to
an organization’s goods and services
 Types of Operational Plans
Standing Plans (Ready) Single Use Plans
Standing plans
Used in situations in which programmed
decision making is appropriate. Consists of

Policies are general guidelines to situation.

Rules are formal written guides to action.
Standard operating procedures (SOP) are
written instructions describing the exact
series of actions that should be followed in a
specific situation.
Single-use plans

Developed to handle non-programmed decision-making in

unusual or one-of-a-kind situations. Consists of

Program — Integrated sets of plans achieving certain

goals

Projects — Specific action plans to complete various

aspects of a program