Management of Business HOMEWORK (URGENT!!!)

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Principles of Management

Topic 04 – Planning & Decision Making Strategies

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Topic 04 – Learning Outcomes

1. Analyse the planning process

2. Distinguish between formal and informal planning.

3. Recognize the features of well-designed objectives.

4. Identify the various types of action plans that managers can use to accomplish stated objectives.

5. Utilize the six steps of decision-making

6. Apply the criteria of quality and acceptance to a decision.

PRINCIPLES OF MANAGEMENT

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A process of defining goals or objectives for the future and map out the activities and means that will make it possible to achieve those goals or objectives.

Planning

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Planning Types

• identify objectives and structure the major tasks to accomplish them.

Formal planning

• triggered by unforeseen circumstances.

Opportunistic planning

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Key Elements to a Plan

1. Objectives

2. Actions

3. Resources

4. Implementation

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1. Objectives

Objectives are more general at the top and become more specific at the

lower level.

Overall objectives of

the organization

reflect its mission.

Objectives should be defined in terms of:

• SpecificS

• MeasurableM

• AttainableA

• RelevantR

• Time-basedT

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1. Objectives – Management by Objectives MBO

(1)

• Establish mutually agreed objectives between employee and supervisor

(2)

• Develop action plan to accomplish objectives

(3)

• Monitor progress toward achievement of objectives (ongoing)

(4)

• Formally evaluate extent to which objectives were met or exceeded

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2. Actions

Managerial Level

Level of Detail

Time Horizon

Strategic Strategic Managers

Low Long (3-7 years)

Tactical Tactical Managers

Medium Medium (1-2 years)

Operational Operational Managers

High Short (<1 year)

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2. Actions (Cont’d)

• Proactivity • Congruency • Synergy

Strategic Action Plans

• Division of labor • Budgeting

Tactical Action Plans

Operational Action Plans

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3. Resources

Financial People Equipment/Tools/ Machineries

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4. Implementation

Defining tasks to be

accomplished

Assigning individual

responsibilities

Managing individuals to

ensure completion

Class Activity1

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Decision Making

The process of identifying problems and opportunities and resolving them or taking advantage of them

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Steps of Decision Making

Identifying and diagnosing the problem

Generating alternative solutions

Evaluating alternatives

Choosing the best alternative

Implementing the decision

Evaluating the results

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Step 1- Identifying and Diagnosing the Problem or Opportunity

• Requires committing resources to improve company performanceOpportunity

• When performance is below expected or desired levels of performance

Problem

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• Generate possible solutions based upon perceived causes

Generating Alternative Solutions

Step 2- Generating Alternative Solutions

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Step 3 - Evaluating Alternatives

Examine alternative solutions using a set of decision

criteria

• Costs, revenues, product design

Decision quality

• Based on people’s feelings Decision

acceptance

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Decision Tree

Class Activity2

Is the alternative feasible?

Is the quality of the alternative satisfactory?

Is the acceptance of the alternative satisfactory?

Retain for further consideration

Eliminate from consideration

Eliminate from consideration

Eliminate from consideration

YES YES YES

NO NO NO

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Step 4 - Choosing the Best Alternative

• involves selecting the best alternative from among multiple criteria

Optimizing

• involves selecting the first alternative solution that meets a minimum criterion.

Satisficing

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Step 5 - Implementing the decision

• Provide resources • Exercise leadership • Develop communication systems • Recognize and reward individuals

Implementing the Decision

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Step 6 - Evaluating the Results

• Gather information and try to learn if the implemented decision achieved its goals

Evaluating the

Results

Class Activity3

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