Lec 6 Chap 6

8/8/2019 Lec 6 Chap 6

http://slidepdf.com/reader/full/lec-6-chap-6 1/20

Copyright ¥ 2005 McGraw-Hill Australia Pty Ltd

PPTs t/a Management: A Pacific Rim Focus 4e by Bartol, Tein, Matthews, Martin 6±1

CHAPTER 6

ESTABLISHING

ORGANISATIONALGOALS & PLANS, THEN

DEVELOPING

STRATEGY

8/8/2019 Lec 6 Chap 6




THE PLANNING PROCESS

MissionThe organisation¶s purpose or fundamentalreason for existence

GoalFuture target or end result an organisation wishesto achieve

PlanMeans devised for attempting to reach a goal

8/8/2019 Lec 6 Chap 6




THE PLANNING PROCESS

mission goals plans

Goal attainment(organisational

efficiency

& effectiveness)

Setting goals & developing plansleads to goal attainment and ultimately,

to organisational efficiency & effectiveness

8/8/2019 Lec 6 Chap 6




ORGANISATIONAL MISSION

µEssentially, planning builds onthe organisation¶s mission, the

organisation¶s purpose or fundamental reason for existence.¶

8/8/2019 Lec 6 Chap 6




ORGANISATIONAL MISSION

The basic purposes that a mission statement serves: For managers it serves as a bench mark against which to evaluate

success

For employees, a mission statement defines a common purpose,nurtures organizational loyalty, & fosters a sense of communityamong workers.

For external parties it helps to provide a unique insight into theorganization¶s values and future directions.

9 Major Components of a Mission Statement:

Customers, Products & Services, Markets,T

ech

nology, Concern for Survival, Growth

&Profitability, Philosophy, Self Concept, Concern for Public Image, Concern for Employees.

8/8/2019 Lec 6 Chap 6




EXAMPLE«

AMOCO (Corp)

Mission Statement

Amoco is a world wide integrated petroleum and

chemical company. We find and develop petroleum

resources and provide quality products and services

to our customers. We conduct our business

responsibly to achieve superior financial returnbalanced with our long-term growth, benefiting

shareholders and fulfilling our commitment to our

community and environment

8/8/2019 Lec 6 Chap 6




NATURE OF

ORGANISATIONAL GOALS

Benefits of goals ± Increase performance

± Clarify expectations

± Facilitate control ± Increase motivation

Levels of goals ± Operational goals (base)

± Tactical goals (mid)

± Strategic goals (top)

8/8/2019 Lec 6 Chap 6




Strategic Goal

³ Double company revenues in 2 years through marketdevelopment and market penetration (current revenues are $2million)´

Tactical Goal

³ Increase the northern division¶s revenue by 50% this year and 50% next year´

Operational Goal ³ Develop two new products this year that are successfully

marketed´ ³Increase Production efficiency by 30% this year´ ³Increase number of salespeople by 40 this year´ ³Reduce Employee absenteeism from 10% to 5% this year´

8/8/2019 Lec 6 Chap 6


8/8/2019 Lec 6 Chap 6




GOALS AND PERFORMANCE

Key aspects:

Goal content (channelling effort

towards achievement) Goal commitment

Work behaviour

Other process components

Possible problems

8/8/2019 Lec 6 Chap 6




GOAL CONTENT: Challenging

Attainable

Specific & measurable Time-limited

Relevant

GOAL

COMMITMENT:

Influenced by:Supervisory authority

Peer & group pressure

Public display

Expectations of success

Incentives & rewardsParticipation

WORK BEHAVIOUR :Goals & commitment affect work

behaviour

DirectionEffort

Persistence

Planning

Job process components affect

performance:Job knowledge & ability

Task complexity

Situational constraints(tools, materials,

equipment)

8/8/2019 Lec 6 Chap 6




LINKING GOALS & PLANS

Levels of plans: Strategic

Operational

Tactical

Recurring use: Single-use: programs and projects

Standing plans: policies, procedures, rules

8/8/2019 Lec 6 Chap 6




Programs: comprehensive plan coordinating a setof activities for a major non recurring goal.

Involves different organizational units, compriseseveral projects

Over a year to complete

Project is a plan coordinating a set of limited scopeactivities not needing to be divided into major

components to reach an important non-recurringgoal.

8/8/2019 Lec 6 Chap 6




Standing plans

Policy: general guide specifying broad parameterswithin which organizational member operate

Do not dictate specific actions, provide generaboundaries

Procedure: set of series of steps to be taken incertain recurring circumstances. E.g. SOP

These are detailed and step by step instructionsare spelled out

Rule is a statement spelling out specific actions tobe taken or not taken in a situation.

8/8/2019 Lec 6 Chap 6




LINKING GOALS & PLANS

Time horizons of goals/plans: Short

Intermediate

Long range

Promoting innovation by: Mission statement:

Goal content & process

1. Within 5 years, the organisation will be #1 provider of thestate of art semi conductor chips.

2. Within 2 years the programmable logic devises division willintroduce 20 new products

Planning content & process

8/8/2019 Lec 6 Chap 6




OBSTACLES TO PLANNING

Domination by specialists

Low levels of manager skill & knowledge

Pressure of day-to-day work

Manager hostility

Environmental change

8/8/2019 Lec 6 Chap 6




OBSTACLES TO PLANNING

REDUCING PLANNING OBSTACLES

Use of planning staff

Small group who assist managers in planning

Use contingency planning

Development of alternative plans

8/8/2019 Lec 6 Chap 6




MANAGEMENT BY OBJECTIVES

Process through which specific goalsare set collaboratively for theorganisation as a whole and every

unit within it; the goals are then usedas a basis for planning, managingorganisational activities, andassessing and rewardingcontributions.

8/8/2019 Lec 6 Chap 6





Steps in the MBO process:

Develop organisational goals

E

stablish specific goals for departments Formulate action plans

Implement & maintain µself-control¶

Review progress periodically

Appraise performance

8/8/2019 Lec 6 Chap 6





Strengths: Helps link goals & plans

Clarifies priorities, expectations

Fosters organisational communication

Builds member motivation

Weaknesses: Needs strong, enduring commitment

Requires training of managers

May be misused(i.e. for punishment)

Risk of dominance of quantitative goals

Lec 6 Chap 6

Documents

Transcript of Lec 6 Chap 6