BUSA (Chapter 4).docx - CHAPTER 4 PLANNING AND DECISION MAKING BENEFITS AND PITFALLS OF PLANNING Planning choosing a goal and developing a method of


This preview shows page 1 - 3 out of 4 pages.

CHAPTER 4: PLANNING AND DECISION MAKING BENEFITS AND PITFALLS OF PLANNING Planning : choosing a goal and developing a method of strategy to achieve that goal. (A) Benefits of Planning o Provides direction : allows everyone in the organization to understand how their efforts can contribute to achieving an organization’s goals. o Intensifies efforts : plans encourage managers and employees to direct greater efforts toward activities that help accomplish their goals and away from activities that don’t o Reduces uncertainty: managers are able to consider future changes and potential problems that might arise and then develop the appropriate strategies to respond. Planning reduces the negative impact that can occur as a result of future events. o Facilitates decision making: managers are able to refer to those pre-planned plans to help guide current decision making. Without a plan, managers will make decision counterproductive of their goal. (B) Planning Pitfalls. o Impedes change and prevent or slow adaptation: some companies become to committed to achieving the goals set forth in their plans that they fail to notice when their plans aren’t working or their goals need to change. o False sense of certainty: all planning is based on assumption and planning therefore might create a fall sense of security to planners by making them feel like they know exactly what the future holds for their competitors, their suppliers, and their companies. o Detachment of planners: strategic planners and top-level managers are supposed to focus on the big picture rather than the implementation. But because they are not part of the implementation process (detachment) planners plan for things they don’t understand. HOW TO MAKE A PLAN THAT WORKS (1) Setting Goals o Goals need to be specific and challenging to direct behavior and increase effort. o S.M.A.R.T. goals: specific, measurable, attainable, realistic, and timely. (2) Developing Commitment to the Goals o Goal commitment: the determination to achieve a goal. o Goal commitment is not automatic, managers and workers must choose to commit themselves to it. (3) Developing Effective Action Plans o Action plan: lists the specific steps (how), people (who), resources (what), and time period (when) for accomplishing a goal. (4) Tracking Progress o Set short term and long term goals: Short term goals define the preliminary levels of performance that need to be achieved in order to attain the long term goal. o Gather and provide performance feedback: allows workers and managers to track their progress toward goal achievement and make adjustments in effort, direction, and strategies.
Image of page 1

Subscribe to view the full document.

(5) Maintaining Flexibility o Adopting an options-based approach : keeping options open by making small, simultaneous investments in many alternative plans. The purpose is to eave those commitments open by
Image of page 2
Image of page 3

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Ask Expert Tutors You can ask 0 bonus questions You can ask 0 questions (0 expire soon) You can ask 0 questions (will expire )
Answers in as fast as 15 minutes