Download The Manager as Decision Maker

The Manager
as a Planner
Developing a SWOT analysis
The Planning Process
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Planning-identifying and selecting
appropriate goals and courses of action for
an organization
Strategy-The cluster of decisions that
managers take to help a company reach its
goals
Mission-a broad declaration of an
organization’s purpose that identifies the
companies products and customers and
distinguishes the organization from the
competition
Three Steps in Planning
 Determine
the organization’s mission and
goals
 Formulating strategy-analyze the current
situation and develop strategies to
achieve the mission
 Implement strategy-allocate resources
between groups to ensure the strategy is
achieved
Levels and types of Planning
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Corporate Level Plan-top management’s
decisions regarding which industries, and
national markets a company intends to
compete
Business Level Plan-developing long term
goals indicating how a division intends to
compete against its rivals in the industry
Functional Level Plan-indicates how a
function intends to achieve the goals of a
division or business level
Time Horizons of Plans
 Long
Term Plans-5 years or more
 Intermediate Plans-1-5 years
 Short term Plans-less than one year
 Corporate and business level plans are
long and intermediate
 Functional plans are short to intermediate
 Most organizations have a rolling planning
cycle
Types of Plans
 Standing
Plans-use in programmed
decision situations such as policies, rules,
or standard operating procedures (sop)
 Single use plans-developed for a one
time, non programmed issue
Why Planning is Important
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Planning ascertains where the organization is
now and where it will be in the future
Participation-all managers are involved in
setting goals
Sense of direction-sets goals and strategies for
managers
Coordination-how the system fits within the
company
Control- who is responsible for achieving goals
Scenario Planning
 Scenario
Planning (Contingency
Planning)-generating multiple forecasts of
future conditions followed by an analysis
of how to respond to each condition
 Effective Plans have
1.
2.
3.
4.
Unity=1 plan
Continuity-ongoing plan
Accuracy-factual information
Flexible-adjust plans as necessary
Determine Mission and Goals
 Define
the business-Who are customers?
What needs are being satisfied?
 Establish major goals-provides a sense of
direction and stretches the organization
to higher levels of performance. Goals
must be challenging but realistic
Formulating Strategy
 Managers
analyze the current situation to
develop strategies for achieving the
mission
 SWOT analysis- a planning exercise in
which managers identify company
strengths, weaknesses, and external
opportunities and threats
Five Forces Model
 Level
of competition
 Potential for Entry
 Power of suppliers
 Power of customers
 Substitutes
Formulating Corporate Level
Strategies
 Concentration
in a single business
 Related diversification
 Unrelated diversification
 International expansion
1.
2.
Global-selling the same product in all
countries
Multidomestic-customizing products to
specific national conditions
Vertical Integration
 Vertical
Integration-allowing an
organization to create value by
producing its own inputs or distribution its
own products
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Backward integration-seeks to reduce its
input costs by producing its own inputs
Forward integration-distributes its own
outputs to lower distribution costs
Business and Function Level
strategies
 Business-low
cost or differentiation
 Functional-seeks to have each
department add value by lowering costs
or adding new value by:
1.
2.
3.
4.
Attaining superior efficiency
Attaining superior quality
Attaining superior innovation
Attaining superior responsiveness to
customers
Planning and Implementing
Strategy
1.
2.
3.
4.
5.
Allocate implementation responsibility to
appropriate individuals
Draft detailed action plans
Establish a timetable for implementation
Allocate resources
Hold specific groups responsible for the
attainment of goals