LECTUREPEDIA - Ajarn Paul Tanongpol, J.D.; M.B.A.;B.A.; CBEST
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LECTUREPEDIA - Ajarn Paul Tanongpol, J.D.; M.B.A.;B.A.; CBEST
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CHAPTER 7 Planning and Controlling
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1. Managers plan?
i. Define your objectives ii. Determine where you stand vis-à-vis objectives iii. Develop premises regarding future conditions iv. Analyze and among action alternatives v. Implement the plan and evaluate results
i. Planning improves focus and flexibility ii. Planning improves action orientation iii. Planning improves coordination iv. Planning improves time management v. Planning improves control
i. Establish objectives and standards ii. Measures actual performance iii. Compare results with objectives and standards iv. Take corrective action
i. Feed-forward controls ii. Concurrent controls iii. Feedback controls
i. Purchasing control ii. Inventory control iii. Statistical quality control
1. Specific 2. Time defined 3. Challenging 4. Measured ii. MBO process iii. MBO Pros and Cons
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Planning is a process of setting objectives and determining how to best accomplish them. Planning involves deciding exactly what you want to accomplish and how best to go about it.
When planning is done well, it creates a solid platform for further management efforts at organizing – allocating and arranging resources to accomplish essential tasks; leading – guiding the efforts of human resources to ensure high levels of task accomplishment; and controlling – monitoring task accomplishment and take necessary corrective action.
i. Define your objectives ii. Determine where you stand vis-à-vis objectives iii. Develop premises regarding future conditions iv. Analyze and among action alternatives v. Implement the plan and evaluate results
i. Planning improves focus and flexibility ii. Planning improves action orientation iii. Planning improves coordination iv. Planning improves time management v. Planning improves control
i. Short-range = 1 year or less ii. Intermediate-range = 1 – 2 years iii. Long-range = 3 or more years
i. Strategic plan Comprehensively addresses long-term directions for the organization. The management planning of this scope involves determining for the entire organization and then deciding on the actions and resource allocations to achieve them.
ii. Operational plan Address specific activities to implement strategic plans. o Production plan o Facilities plan o Marketing plan o Human resource plan
i. Policy A policy communicates broad guidelines for making decisions and taking action in specific circumstances.
ii. Rules and procedures These are plans that describe exactly what actions are to be taken in specific situations. They are often found stated in employee handbook or manuals as SOP: Standard Operating Procedures.
i. Budget A budget is a plan to commit resource to projects or activities. It can be in a form of money or other type of resources, i.e. equipment. o Fixed budget Allocate resources on the basis of a single estimate of costs. The estimate establishes a fixed pool of resources that can be used, but not exceeded, in support of specified purpose.
o Flexible budget This type of budgeting allows allocation of resource allocation when activity increases from one estimated level to the next.
ii. Zero-based budget An activity or project is budgeted as if it were brand new. There is no assumption that resources previously allocated to a project or activity will simply be continued in the future.
iii. Project schedule This is a single-use plan that identifies the activities required to accomplish a specific major projects. In each c
In each case, the project schedule would define specific task objectives, and activities to be accomplished.
A forecast is an attempt to predict the future. All good plan involves a forecast. Forecasting is a process of making assumption of what will happen in the future. o Quantitative o Qualitative
Identity alternative courses of action for use if and when circumstances change with time. Able to handle unplanned circumstances.
Identifies alternative future scenarios and make plans to deal with each. Answer the question of what if this happens, how would you solve the problem?
Use external comparisons to gain insight for planning. Learn from your competitor. If a competitor can compete with you, it must think that it has as good or better a plan then yours.
These professionals are skilled in all steps of the formal planning process, including the benchmarking and scenario-panning approaches expertise. Staff planners can bring focus to efforts to accomplish important, often strategic, planning tasks.
Include people who will be affected by the plan and/or whose help is needed to implement them.
Controlling is the process of measuring performance and taking action to ensure desired results. Controlling involves the following 4 steps: o Establish objective standards o Measure actual performance o Compare results with objectives and standards o Take corrective action as needed
See above.
i. Establish objectives and standards ii. Measures actual performance iii. Compare results with objectives and standards iv. Take corrective action 1. Management by exception Focus on managerial attention on substantial differences between actual and desired performance.
2. After-action review Formally review results to identify lessons learned in a completed project, task force, or special operation.
i. Feed-forward controls This is also known as preliminary controls. They are accomplished before a work activity begins. They ensure that objectives are clear, that proper directions are established, and that the right resources are available to accomplish them.
ii. Concurrent controls Sometime they are called steering controls. They monitor on-going operations and activities to make sure things are being done according to plans.
iii. Feedback controls They are also called post-action controls. They take place after work is completed. These types of control focus on the quality of end results rather than on inputs and activities.
i. Internal control This type of control allows the individuals and group to exercise self-discipline in fulfilling job expectations.
ii. External control Managers can take action to supervise the behavior of other people. External control occurs through personal supervision and the use of formal administrative systems.
In addition to salary compensation, the company may give additional incentive for good performance that exceeds expectation or goal. This helps build motivation among workers. There are two types: i. Pay for performance ii. Merit pay
i. Discipline This is the act of influencing behavior through reprimand.
ii. Progressive discipline This is the process of typing reprimands to the severity and frequency of misbehavior.
i. Liquidity ii. Leverage iii. Asset management iv. Profitability
i. Purchasing control ii. Inventory control iii. Statistical quality control
Management by objectives (MBO) is a structured process of regular communication in which a supervisor/team leader and subordinate/team member jointly set performance objectives and review results accomplished.
1. Specific 2. Time defined 3. Challenging 4. Measured
ii. MBO process
iii. MBO Pros and Cons 1. Pros o Focus on subordinate’s work efforts o Focus on supervisor’s support to subordinate o Build relationship among subordinate and supervisor o Enthusiasm
2. Cons o Tie MBO to pay o Focus too much on objectives o Excessive paperwork o Supervisor loses sight and telling subordinates to do things instead of rendering support
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