Chapter 4
Planning
Management is a multi-step process that involves looking ahead, making good plans, and acting upon them. W. E. Henly quoted “I am the master of my fate; I am the captain of my soul.” When you know where you want fate to lead you and you know what you must do to get there, you will be able to guide yourself to your destination. Imagine a big organization consisting of over 100 people. Without a plan, each individual would do what they believe to be the “right” thing. With different people heading in different directions, when will they ever meet at the same finish line? That is why planning is very important, both in the organization and in your daily life.
Planning
Management helps people take actions needed now in order to best meet the challenges of the future. Planning is the first step in the management process. It is the process of setting objectives and determining what should be done to accomplish them (Schermerhorn, 2001, 136). The outcome of the planning process is an organizational plan that sets a standard platform for further managerial efforts, such efforts include organizing (the allocation of resources for accomplishing essential tasks), leading (guiding efforts of human resources to ensure high levels of task accomplishment), and controlling (evaluating how well an organization has accomplished different tasks and taking necessary corrective action), which will be discussed in detailed in chapters 5-7.
Understanding the central idea behind planning in the management process is in fact very important. In the business environment today, it is necessary to get ahead and to stay ahead of competitors. Organizations must have a better plan and strive to do better.
Planning Involves:
The planning process itself, involves many activities. The first is to find a mission. A mission statement is to be made. It is a broad declaration of an organization’s purpose that identifies the organization’s products and customers and distinguishes the organization from its competitors (Jone & George, 2003, 251). An important part of planning is the objective, or the specific results desired at the end. The third involves determining the activities and methods needed. Organizations must have a plan. They must know what they have to do and what method to use to reach their goal efficiently. The last part of the planning involves analysis and decision making. Here companies look at the accomplished results and analyze whether or not they meet the plan set and whether or not they should continue pursuing this method.
Benefits of Planning
Organizations today face both internal and external pressure. External pressure includes greater government regulations, uncertainties of a global economy, technologies, and the sheer cost of investing in resources such as labor and capital. Internal pressure includes new structures and work arrangements, more diversity in the workforce, and other managerial related challenges. In such circumstances, planning provides different benefits to the performance of each person within the organization and of the organization as a whole.
More Focus and Flexibility: Good planning improves both focus and flexibility of a company, both of which are essential. An organization with focus knows what it does best. An individual with focus knows which direction they want to go in their career or in different situations. An organization with flexibility is willing and able to make changes and can adapt to shifting circumstances. They operate with an orientation towards the future rather than the present or past. An individual with flexibility is able to adapt the problems and opportunities posed by the new and developing circumstances into their career plan.
Action Oriented and Proactive: Stephen Covey, a management consultant pointed out that the most successful executives “zero in on what they do that ‘adds value’ to an organization.” He concluded that instead of working on too many things, take a step back and identify the most important things needed to be done. Planning helps us to stay proactive rather than reactive in approaching things.
It does so by making us:
(1) Results oriented- creating a performance oriented sense of direction
(2) Priority oriented- making sure the most important things get first attention
(3) Advantage oriented- ensuring that all resources are used to the best advantage
(4) Change oriented- anticipating problems and opportunities so they can be dealt with best (Thune & House, 1970).
Improve Coordination: Each different group, subsection, and individuals in an organization are all doing different things at the same time. Nevertheless, as they pursue different tasks and objectives, their accomplishments must add up to meaningful contributions towards the needs of the entire organization. Good planning indeed improves coordination. Planning creates a hierarchy of objectives which link the objectives of each level together in the means-end fashion. This means that the higher level objectives as ends are directly tied to the lower level objectives as the means for their accomplishments (Schermerhorn, 2001, 138). The hierarchy of objectives lets individuals and groups know their roles and contributions, which then can guide and integrate efforts in a firm to meet the corporate-level quality.
Better Control System: the control process is the measuring of performance results and taking corrective actions to improve things when needed (which will be discussed later in chapter 6). Planning makes this possible. It defines the objectives – know what to do, when to do it, and what is the expected results.
In a management function, planning and controlling work closely together. Without planning, controlling would lack a framework for how well things are going and how to improve it. As a result, planning helps organizations minimize risks caused by problems from both internal and external pressures.
Better Time Management: Everyday we are bombarded by a multitude of tasks that need to be completed, plus frequent interruptions, crises, and unexpected events. It is easy to lose track of time in situations like these and fall prey to what consultants call “time wasters” (Schermerhorn, 2001, 140). Better time management in our personal affairs is a side benefit of planning that result from improved focus and flexibility, coordination, and control.
The Planning Process
A plan is a statement of action steps to be taken in order to accomplish the objectives (Schermerhorn, 2001). The planning process is a 5 step process.
Step One: Define objectives- Identify desired outcomes or results.
Characteristics of a good objective (SMART):
• Specific--so you know that you have arrived when you get there.
• Measurable-- know how far off the mark you are at different points.
• Attainable-- make sure that your objective is possible to achieve
• Reasonable-- your objective must be fair, practical, and acceptable
• Time frame-- set the dates of when to start, when each task must be accomplished, and a deadline which you will reach your objective.
Step Two: Determine the current status vis-à-vis objectives- Evaluate tasks already accomplished in relative to the results desired to know where you stand in reaching the objective. Also, assess the organization’s strengths and weaknesses.
Step Three: Develop premises regarding future conditions- Try to foresee future events and generate “scenarios” of what might occur; from each scenario, Identify factors that will affect the future that are related to the plan.
Step Four: Analyze all possible action alternatives- List all alternative actions that may be taken and analyze the feasibility of each alternative. Choose the best possible alternative(s); describe a step by step of the actions to achieve objectives.
Step Five: Implement the plan and evaluate results- Carry out every action in accordance to the plan and measure the progress and results. Modify and take corrective action to the plan as needed.
Edward Deming’s PDCA Cycle
The Deming cycle, or the PDCA cycle (also known as the PDSA cycle) is a continuous quality improving model. It all began when W. Edward Deming began his work in Japan in the 1950’s. He was involved in building the Japanese industry into a world power. According to Deming, quality is maintained and could be improved when managers, leaders, and the workforce understand customer satisfaction and constantly commit to it through continuous quality improvements.
The PDCA cycle:
P= Planning--plan ahead for changes and predict the results
D= Doing--put the plan into action
C= Checking--see if the plan worked (study the results)
A= Action--to either stabilize the quality or to determine what went wrong