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PLANNING

DEFINITION OF PLANNING PLANNING PROCESS STRATEGIC PLANNING OPERATIONAL PLANNING STRATEGIC Vs. OPERATIONAL PLAN TYPES OF PLANNING

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DEFINITON

Planning has been defined by management expert Peter Drucker as “the management function that includes decisions and actions to insure future results."

Perspective: forecasting and budgeting long range planning Strategic planning Strategic management-

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BENEFITS AND LIMITATIONS OF PLANNING

Benefits

1. Establishes direction

2. Sets priorities and focuses action

3. Facilitates resource allocation

4. Increases motivation

5. Reduces cost & risk

6. Improves communication

Limitations 1. Uncertain future

2. Time investment

3. Inflexible

4. Corporate inertia

5. Centrally focused

6. Implementation

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PLANNING PROCESS

o Establishing objectives or goalso Seeking necessary Information o Establishing the planning premiseso Identifying the alternative course of action.o Evaluating the alternatives.o Selecting the best alternativeo Follow up

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STRATEGIC PLANNING“… the continuous process of making present entrepreneurial (risk-

taking) decisions systematically and with the greatest knowledge of their futurity; organizing systematically the efforts needed to carry out these decisions; and measuring the results of these decisions against the expectations through organized, systematic feedback”.

- Peter Drucker

- In short, strategic planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization is, what it does, and why it does it, with a focus on the future.

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STEPS IN STRATEGIC PLANNING

1.Analyze the organization’s internal and external environment

(SWOT analysis)

2.Conduct a stakeholder assessment

3.Define the purpose of the organization

4.Clarify values important to the organization

5.Set the goals and objectives

6.Communicate the goals and objectives to the constituents

7.Identify strategies – set time lines and tasks

8.Estimate and allocate resources

9.Develop and communicate a marketing or business plan

10.Establish a system for the implementation and monitoring of

policies, procedures, and rules

11.Establish a system for exchanging information and building

consensus

12.Provide a mechanism for evaluation

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OPERATIONAL PLANNING

short-range planning that deals with day-to-daymaintenance activities

performed at a unit or departmental level

done as part of the overall strategic planning

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STEPS IN OPERATIONAL PLANNING

1.Set your objectives2.Set your priorities

3.State your assumptions4.Review any and all limitations

5.Develop your primary and back-up plans6.Implement the plan

7.Set up a control system and follow up

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OPERATIONAL PLAN VS. STRATEGIC PLAN

Base Strategic plan Operational plan

Time Several years of decades

1 year or 3 yrs

Degree of details

General and non specific Fine details of day-to-day work

Scope extensive Constricted

Mgmt level Top level Middle of lower level

implementation

Top level Lower level

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TYPES OF PLANS

start-up plan Internal plans operations plan strategic plan growth or expansion or new product plan feasibility plan intermediate planning contingency planning

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Hope it helped