Engineering Management(Planning)
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Transcript of Engineering Management(Planning)
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(PLANNING)
ENGINEERING MANAGEMENT
ENGR. MARK ANTHONY I.
CASTILLANO
CHAPTER 2
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Definition: It is a pro cess o f deciding the bus iness ob ject ives and chart ing ou t the methods o f
at taining those ob ject ives.
Accord ing to Koontz & O’Donnell
“Planning is an intel lectual process, the consc ious determinat ion of course of
act ion, the basing of decis ion on purpo se,
acts and cons idered est imates ” .
Accord ing to Theo Haimann “Planning is decid ing in advance what is to be done.
When a manager plans, he projects a
course of act ion , for the future, at tempt ing
to achieve a consistent , coordinated
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Definition:
Accord ing to Al ford and Beat ty “Planning is the thinking process, the organized
foresight , the vis ion based on fact and
experience that is required fo r in tel l igent
action” .
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Nature of Planning
Plann ing is goal – oriented
Plann ing is a primacy
Planning is al l pervasive
Plann ing is intel lectual/rat ional process
Planning is a con t inuo us p rocess
Planning is a precis ion
Plann ing invo lves choice
Plann ing is directed towards ef fic iency
Flexib i l i ty of Plann ing
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Importance of Planning
Minim izes Risk and Uncertainty
Leads to success
Focuses Attention on the Organization’s
goal
Faci l i tates Contro l
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Steps in Planning Process
Establ ishing Veri f iable Goals or Set of
Goals to be ach ieved
Establ ish ing Planning Prem ises
Deciding the plann ing period
Find ing A lternat ive Courses of Act ion
Evaluat ing and Select ing a Course of
Act ion Develop ing Derivat ive Plans
Measuring and contro l l ing the Progress
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Hierarchy of Planning
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Types of Planning(According to
Scope)
Corporate Planning - The purpose of corporate planning is to determine the long-
term goals of an enterprise and generate
plans to achieve these goals keeping in view
the probable changes in its environment.
Divis ion/Departmental Planning - It
includes the plans formulated for various
departments or divisions of an enterprise. It determines the scope and activities of a
particular department.
Sector/Group Plann ing - Group or sectional
planning refers to planning for specific groups
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Types of Planning(According to
Span)
Long Term Plann ing - It takes into account the forecasted changes in the environment over the long-term. It provides the overall targets towards which all activities of the
organization are to be directed. Also known asstrategic planning .
Medium Term Plann ing - It more detailed and specific than long range strategic
planning. It is designed to implement strategic plans by coordinating the work of different departments. Also known as tact ical
planning .
Short Term Planning – Also known as
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Difference between Strategic
Planning and Tactical Planning
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Essentials in making Effective Plans It should be based on clearly defined objectives.
It must be simple and easily understandable.
It should be flexible or adaptable to changing
conditions.
It must be balanced in all respects and should be
reasonably comprehensive. It should provide standards for the evaluation of
performance and actions.
It should be economical. I.e., permit optimum use of available resources before creating new authorities
and new resources.
It should be practicable or action oriented.
It should be prepared with the consultation of
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Types of Plans
Stand ing Plan/Mult i – Use Plan
a. Missions /Purposes
b . Objec t ives /Goals c. Strateg ies
d . Polic ies
e. Ru les f. Procedures
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Types of Plans
Single Use Plan/Ad hoc Plan
a. Programme
b. Budget c. Schedu le
d . Pro ject
e. Method
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Standing Plans Miss ions - Mission is a statement that defines
the role that an organization plays in the society.It represents the overall philosophy of anorganization.
Object ives/Goals - Objectives are the resultswhich management wants to achieve throughthe making and implementation of a plan.
Strategies - It is a special type of plan
prepared for meeting the challenges posed by the activities of competitors and other environmental forces.
Polic ies – Policy is defined as a statement of
guidance and instruction; which defines and
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Standing Plans
Rules - A rule is a specific and detailed guide to
action. It is also a standing plan, as they prescribe in advance what is to be done or not
to be done in a specific situation. The top
management derives rules.
Procedures - A procedure, as a type of management plan, specifies the manner of
handling an organizational activity - in terms of
various steps to be undertaken.
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Ad Hoc Plans
Programme - A programme is a plan of action -indicating what work is to be done to carry out a
particular objective.
Budgets - A budget is a plan, which statesexpected results of a given future period innumerical terms. It is a plan of action or blueprint designed to achieve a specific goal. It may beexpressed in time, money, or other measurableunits.
Schedules - A schedule is a time – table of work.It specifies the date when a task is to begin and the time needed to complete each task.
Projects - A project is a complex scheme for theinvestment of resources, which can be analyzed
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Summary of Various Plans
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Difference Between Policies and
Strategies
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Difference Between Policy and
Procedures
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Difference Between Policies and
Rules
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Difference Between Objectives and
Policies
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Definition of Objectives
Objectives are the results which management
wants to achieve through the making and implementation of a plan.
According to Luis Allen, “Objectives are goals
established to guide the efforts of the
company and each of its components” .
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Characteristics of Objectives
An organizat ion has mult ip le ob ject ives.
Object ives have t ime span. Objectiv es are either tangib le or in tang ible.
Object ives form a hierarch y.
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Hierarchy of Objectives
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Objectives of MBO
To measure and judge performance.
To relate individual performance to organizational
goals;
To clarify both the job to be done and the
expectations of accomplishment.
To foster the increasing competence and growth
of the subordinates.
To serve as a basis for judgments about salary and promotion
To stimulate the subordinates’ motivation; and
To serve as a device for organization control and
integration.
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Features of MBO
MBO focuses attention on what must beaccomplished (goals) rather than on how it is tobe accomplished (methods). It is a goal-oriented rather than work-oriented approach.
MBO involves participation of subordinatemanagers in the goal setting process. It requiresall key personnel to contribute maximum toachieve the overall objectives.
MBO stresses measurable and verifiable goals inkey result areas. It attempts to blend and balancethe goals of all key personnel.
MBO is a dynamic system, which seeks tointegrate the company’s need to achieve its
objectives with the manager’s need to contribute
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Features of MBO
MBO is an overall philosophy of management that allows management to attain maximum
results from available resources. It is not a set of
rules or procedures but a way of thinking about
managing. MBO has an operational thrust involving linkage
between organizational goals and individual
goals.
MBO is a continuous process of goal setting,
periodic appraisals and modification of goals and
performance.
It sets an evaluative mechanism by which the
contribution of each individual can be measured.
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Steps in MBO Process
Preliminary goal – setting
Fixing Key Result Areas(KRA)
Settling subordinate objectives Recycling Objectives
Action Planning
Periodic Performance Reviews
Final Appraisal
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MBO Process
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Advantage and Disadvantage of
MBO
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Management By Exception
Management by exception is a system of
identification and communication the signalsto the manager when his attention is needed.
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Features of MBE
Measurement
Project Analyses
Selection Observation
Comparison
Decision Making
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Advantage of MBE
Save time consumptions for executives
Better delegation of authority Better use of knowledge and available data
Enhance decision – making
Enhance degree of communication
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Assignment:
Give at least one example of the following:(a) Strategic Plans
(b) Tactical Plans
(c) Operational Plans Give at least three(3) definition of organizing
as function of management.
Explain the process of organization.
What is the significance of organization
structure?
State the principles of organization.
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