Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Organizational.

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1 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Organizational Planning & Goal Setting Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved.

2 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Goals and Plans  A blueprint specifying the resource allocation, schedules, and other actions necessary for attaining goals.  Planning is considered the most fundamental function.  Planning is the most controversial management function. Plan Goal  A desired future state that the organization attempts to realize.

3 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Levels of Goals/Plans

4 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Goals and Plans Purposes Legitimacy/Mission Statement  Describes values, aspirations, and reason for being.  Focuses on, customers, corporate values, product quality, and attitude toward employees. Source of Motivation and Commitment  Facilitate employees’ identification with the organization. Guides to Action  Provide a sense of direction.  Focus attention on specific targets.  Direct efforts toward important outcomes.  What the organization stands for. Standard of Performance  Serve as performance criteria.  Provide a standard of assessment. Inside Motorola

5 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Peter Drucker’s Eight Content Areas in Developing Goals  Marketing.  Innovation.  Productivity.  Physical and financial resources.  Profitability.  Managerial performance and development.  Worker performance and attitude.  Public responsibility.

6 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Overall Planning Process Begins With:  Mission statement  Strategic goals

7 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Goals and Plans Strategic Goals Where the organization wants to be in the future. Pertain to the organization as a whole. Strategic Plans Action Steps. Blueprint that defines the organizational activities and resource allocations.

8 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Tactical Goals and Plans Tactical Goals  Goals that define the outcomes that major divisions and departments must achieve. Tactical Plans  Plans designed to help execute major strategic plans.

9 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Operational Goals and Plans Operational Goals  Specific, measurable results expected from departments, work groups, and individuals. Operational Plans  Organization’s lower levels that specify action steps toward achieving operational goals.

10 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Planning Time Horizon

11 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Means End-Chain The achievement of goals at low levels permits the attainment of high-level goals.

12 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Characteristics of Effective Goal Setting Goal Characteristics  Specific and measurable.  Cover key result areas.  Challenging but realistic.  Defined time period.  Linked to rewards.

13 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Model of the MBO Process Step 1: Setting Goals Step 2: Developing Action Plans Step 3: Reviewing Progress Corporate Strategic Goals Departmental Goals Individual Goals Step 4: Appraising Overall Performance Appraisal of Overall Performance Corrective Action Review Progress Action Plans Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved.

14 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. MBO Benefits and Problems Benefits of MBO Problems with MBO 1. Manager and employee efforts are focused on activities that will lead to goal attainment. 2. Performance can be improved at all company levels. 3. Employees are motivated. 4. Departmental and individual goals are aligned with company goals. 1. Constant change prevents MBO from taking hold. 2. An environment of poor employer- employee relations reduces MBO effectiveness. 3. Strategic goals may be displaced by operational goals. 4. Mechanistic organizations and values that discourage participation can harm the MBO process. 5. Too much paperwork saps MBO energy.

15 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Plans  Single-Use  Standing  Contingency  Crisis Management Three Stages  Prevention  Preparation  Containment

16 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. The New Planning Paradigm Six Rules of Planning  Start with a Strong Mission  Set Stretch Goals  Create an Environment that Encourages Learning  Design New Roles for Planning Staff  Use Temporary Task Forces  Planning Still Starts and Stops at the Top Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved.

17 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Strategic Management Questions What changing and trends are occurring? Who are the customers? What products or services should we offer? How can we offer these products or services efficiently?

18 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Strategic Management Process Identify Strategic Factors Strengths Weaknesses Scan Internal Environment Core Competence Synergy Value Creation Identify Strategic: Corporate Business Functional Define New: Mission Goals Grand Strategy Evaluate Current: Mission Goals Strategies Scan External Environment National Global Opportunities Threats Identify Strategic Factors SWOT Implementing Strategy via Changes in: Structure Human resources Information & control systems Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved.

19 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Porter’s Competitive Forces Potential new entrants Bargaining power of buyers Bargaining power of suppliers Threat of substitute products Rivalry among competitors Beware

20 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. The Five Forces Affecting Industry Competition SOURCES: Based on Michael E. Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors (New York: Free Press, 1980); and Michael E. Porter, “Strategy and the Internet,” Harvard Business Review (March, 2001), 63-78.

21 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Competitive Strategies 1.Differentiation 2.Cost Leadership 3.Focus

22 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Partnership Strategies “Collaboration” High Low Organizational Combination Strategic Alliance Degree of Collaboration Preferred Supplier Arrangements Strategic Business Partnering Joint Ventures Mergers Acquisitions Source: Adapted from Roberta Maynard. “Striking the Right March,” Nation’s Business (May 1996), 18-28.

23 Developed by Cool Pictures & MultiMedia PresentationsCopyright © 2004 by South-Western, a division of Thomson Learning. All rights reserved. Tools for Putting Strategy into Action SOURCE: Adapted from Jay R. Galbraith and Robert K. Kazanjian, Strategy Implementation: Structure, Systems, and Process, 2d ed. (St. Paul, Minn.: West, 1986), 115. Used with permission.