EXPERIENCE INTERNATIONALITY EMPLOYABILITY Week 6 – Planning & Strategy © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 1 Recap – Week 5 1. 2. 3. 4. 5. What is entrepreneurship Impact of entrepreneurial companies Who are entrepreneurs Social entrepreneurship Launching an Entrepreneurial Start-Up © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 2 LEARNING OBJECTIVES – Planning and Goal Setting 1. Define goals and plans and explain the relationship between them. 2. Explain the concept of organizational mission and how it influences goal setting and planning. 3. Categorize the types of goals an organization should have. 4. Explain how managers use strategy maps to align goals. 5. Define the characteristics of effective goals. 6. Outline the four essential steps in the management-by-objectives (MBO) process. 7. Compare and contrast single-use plans and standing plans. 8. Discuss the benefits and limitations of planning. 9. Describe contingency planning, scenario building, and crisis planning, and explain the importance of each for today’s managers. 10. Identify innovative planning approaches that managers use in a fast-changing environment. © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 3 PLANNING IS FUNDAMENTAL All of the other management functions stem from planning How do you plan for an undefined future? No plan is perfect Without plans and goals, organizations flounder © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 4 GOALS AND PLANS © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 5 LEVELS OF GOALS AND PLANS © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 6 Levels of goals and plans • The formal mission defines the basic purpose of the organisation and is the basis for the strategic level of goals and plans • Strategic goals and plans reflect a commitment to organisational efficiency and effectiveness • Tactical goals and plans focus on the major actions that the division must take to fulfil its part in the strategic plan • Operational plans identify the specific procedures and tasks needed at lower levels of the organisation • that help meet strategic and tactical goals © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 7 THE ORGANIZATIONAL PLANNING PROCESS © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 8 GOAL-SETTING IN ORGANIZATIONS Organizational mission – the organization’s reason for existence, describes the organization's values and aspirations, they are the basis of all goals and plans Strategic goals – official goals, broad statements describing the organization’s future Strategic plans – define the action steps the company will take to attain strategic goals, defines the organizational activities and resource allocations Goals should be aligned using a strategy map 9 © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY • Tactical goals are the results that the middle management within the organisation intend to achieve so that overall goals are attained • Tactical plans are designed to help execute the major strategic plans and to accomplish a specific part of the company’s strategy • Operational goals are the results from lower management that are precise and measurable • Operational plans are developed by lower management to specify action steps toward achieving operational goals and to support tactical plans © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 10 A STRATEGY MAP FOR ALIGNING GOALS © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 11 • Effectively designed organisational goals are aligned – they are consistent and mutually supportive so that the achievement of goals at low levels permit the attainment of high-level goals • A strategy map is a visual representation of the key drivers of an organisation’s success • It shows how specific goals and plans in each area are linked • it provides a powerful way for managers to see the cause-and-effect relationships among goals and plans © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 12 OPERATIONAL PLANNING Direct employees and resources Guide toward efficient and effective performance Includes planning approaches: Management-by-Objectives (MBO) Single-Use Plans Standing Plans © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 13 CHARACTERISTICS OF EFFECTIVE GOAL SETTING © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 14 Key performance indicators assess what is important to the organisation and how well the organisation is progressing toward attaining its strategic goal, so that managers can establish lower-level goals that drive performance toward the overall strategic objective © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 15 MODEL OF THE MBO PROCESS Defined in 1954 by Peter Drucker Method for defining goals and monitoring performance © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 16 MBO BENEFITS © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 17 MBM Management by means focuses attention on the methods and processes used to achieve goals (systematic approach). © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 18 SINGLE-USE AND STANDING PLANS Single-Use Plans Achieve one-time goals Programs and projects Standing Plans Ongoing plans that provide guidance for tasks and situations. Policies, rules, procedures © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 19 TYPES OF SINGLE-USE AND STANDING PLANS Single-Use Plans Program: building new headquarters, converting paper files to digital Project: renovating the office, setting up a new company intranet © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 20 TYPES OF SINGLE-USE AND STANDING PLANS Standing Plans Policy: Sexual harassment policies, Internet and social media policies Rule: No eating rule in areas of company where employees are visible to public Procedure: Procedures for issuing refunds, Procedures for handling employee grievances © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 21 MAJOR TYPES OF SINGLE USE AND STANDING PLANS © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 22 BENEFITS AND LIMITATIONS OF PLANNING Benefits: • Goals and plans provide a source of motivation and commitment • Goals and plans guide resource allocation • Goals and plans are a guide to action • Goals and plans set a standard of performance Limitations: • Goals and plans can create a false sense of certainty • Goals and plans may cause rigidity in a turbulent environment • Goals and plans can get in the way of intuition and creativity © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 23 PLANNING FOR A TURBULENT ENVIRONMENT Contingency Planning Planning for emergencies, setbacks, or unexpected conditions Building Scenarios A forecasting technique to look at current trends and discontinuities and visualize future possibilities Crisis Planning Unexpected events that are sudden and devastating © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 24 ESSENTIAL STAGES OF CRISIS PLANNING © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 25 Innovative approaches to planning Decentralised planning means that planning experts work with managers in major departments to develop their own goals and plans. © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 26 SET STRETCH GOALS FOR EXCELLENCE Stretch goals are highly ambitious Clear, compelling, and imaginative Require innovation Goals must be seen as achievable Like Big Hairy Audacious Goal (BHAG) from 1996 article on “Building Your Company’s Vision” As times move faster and become more turbulent, these are important © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 27 USE PERFORMANCE DASHBOARDS Dashboards keep track of key performance metrics align and track goals can be applied throughout the company on the factory or sales floor. © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 28 A PERFORMANCE DASHBOARD FOR PLANNING © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 29 DEPLOY INTELLIGENCE TEAMS Intelligence teams cross-functional group of managers work together gain a deep understanding of a specific competitive issue offer insight and recommendations for planning © 2017 MONASH SOUTH AFRICA CONFIDENTIAL & PROPRIETARY 30
