Planning

Essentials of Planning and

Managing by Objectives

After studying this chapter, you

should be able to:
1.
2.
3.
4.

Understand what managerial planning is and why it is important

Understand Vision, Mission, Goals and Objectives
Identify and analyze the various types of plans and show how they
relate to each other
Understand the model of the systems approach to MBO

What is a Plan?

Plan?
1.
2.
3.
4.
5.
6.

What to do?
When is the dead line?
Where will be this done?
Who will do it?
How will it be done?
How much time, energy and resources are
required to accomplish this?

Planning
Planning refers to the process of deciding what
to do and how to do it well in advance.
A plan is a blueprint for goal achievement that
specifies the necessary resource allocations,
schedules, tasks, and other actions.
Planning is a primary managerial activity that
involves

Defining the Organizational goals

Establishing an overall strategy for
achieving this goal
Outlining tasks and schedules to accomplish
the goals

Planning Principles
A Good Plan ?
Have a clear goal and be simple &
flexible
Comprehensive
Efficient
Inclusive
Informative
Integrated
Logical & Transparent
Facilitate Decision making & Control

Planning should have

a Vision
Future

Now
Mission drives the work.
Plan drives the action.

Overview of Vision,Mission,Goals
and Objectives

Vision - An expression of the desired end state

Involves thinking
strategically about
Firms future
business plans
Where to go
and What we
want to be?

Mission Statement
Captures the essence of
why the organization
exists?
Who we are?
what we do?

Vision - Tata Tea: To be Indias foremost tea

based beverage company

Mission - Tata Tea: (a) Achieve market and
thought leadership for branded tea in India (b)
Be recognized as the foremost innovator in tea
and tea based beverage solutions (c) Drive longterm profitable Growth (d) Co-create enhanced
value for all stakeholder (e) Make Tata Tea a
great place to work

Vision - McDonald: McDonald's

vision is to be the world's best
quick service restaurant
experience. Being the best means
providing outstanding quality,
service, cleanliness, and value, so
that we make every customer in
every restaurant smile.
Mission - McDonald: (a) Be the best
employer for our people in each
community around the world, (b)
Deliver operational excellence to
our customers in each of our
restaurants; and (c) Achieve
enduring profitable growth by
expanding the brand and
leveraging the strengths of the
McDonald's system through
innovation and technology.

Goals
Desired outcome that is supportive of the mission
and vision.
Shapes the way ahead in actionable terms.
Puts strategic focus into the organization

Objectives

Relevant - directly supports the goal

Specific enough so we can quantify and measure the results
Simple and easy to understand
Realistic and attainable
May need several objectives to meet a goal

Example
Goal may be for a chocolate manufacturer to
break into a new overseas market
Objectives:

To capture 0.5% market share

Develop relationships with overseas suppliers
Identify network of retail outlets
Conduct market research to identify consumer needs
Find location for overseas sales team HQ

Classification of Plans
Types of
Plans

Frequency of
use
1.Single use
2.Standing

Time Frame
1.Long-term
2.Mediumterm
3.Short-term

Breadth
1. Strategic
2. Tactical
3. Operational

Contingency Planning

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

PROACTIVE PLANNING
&
REACTIVE PLANNING

Model of the MBO Process

Defined in 1954 by Peter Drucker
Method for defining and monitoring goals

20

End