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PlanningI-foundation of planning1-What is Planning? Planning: “Thinking before Doing” Planning: “What is to be done” and “How is to be done”

Chapter2:

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Planning can be defined in term of :1. Formal Planning:

Setting specific objectives or goals. Covering period of time. writing down.and sharing of objectives to organizational members (subordinates).

2. Informal Planning: Nothing writing down. No sharing of objectives to the subordinate in organization. No timing

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2-Purpose of planningAll managers should engages in

planning, because, planning can :• Give direction• Reduce the impact of changes• Minimize waste• Set standard to participate control

3-Type of planningA-In terms of scope of activities Strategic plan: Tactical plan: Operational plan:

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B-In terms of time frame

Long term plan: Short term plan: Intermediate plan:

C-In terms of time frame

Specific plan: Directional plan:

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4-Approachs to planningTop down planning: Bottom up planning:Inside out planning: Outside in planning:

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II-Major planning tools Budgets:

Schedules:

Standard:

Policies:

Procedures:

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1-What is strategic PlanningIt is the determining what organization’s long term goals should be for the next 1-10 years with resources they expect to have available.

2-Strategic Business PlanningIt is the documentation that preparing by carefully including four step as bellow:

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Vision,

mission, objectives/goals

Internal analysis

(Strong and weakness

External analysis

(Opportunity and Threats

SWOT analysis and Create Strategy

Implementation

Evaluation

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A-VisionIt is the determining what organization’s long term goals should be for the next 1-10 years with resources they expect to have available.Build Bright University will be one of the leading and internationally recognized universities in the region.

B-Purpose Who we are ? What we do ? Whom our customers are ?

or For whom do we do it ?Example: BBU: Motorola:

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3-Environment AnalysisA. External Factors

Economy: Society/Culture: Technology: Competition: Labor Supply:B. Internal Factors Human Resources: Product and Services: Finance: Equipment/Technology: Policy: Culture:

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SMART goals Specific Measurable Attainable Result Time

SWOT analysisIt is a comparison of Strengths, Weakness, Opportunities, and Threats that help executives formulate strategy.

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Internal Assessment of the Organization

External Assessment of the Environment

What are our weaknesses ?

• Outdate facilities

• Inadequate R&D

• Obsolete technology

• Weak planning failures

What are our threats ?

• New competitions

• New regulations

• Changing market tastes

• Substitute products

• Shortage of resources

What are our strengths ?

• Manufacturing efficiency

• Skill workforce

• Good market share

• Strong financing

• Superior reputation

What are our opportunities ?

• Possible new markets

• Strong economy

• Weak rivals

• Emerging technologies

• Growth of existing market

SW

OT

An

aly

sis

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4- Developing Strategy1. Marketing strategy: developing

marketing objectives are base on the situation analysis.

Conduct market segmentation. Select target market and measure market demand. Create strategic marketing mix. Determine sales forecasting.

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2. Product strategy: Select Location Accessorily to transportation. Closeness to the market. Availability of labor, raw material. Cost factors (land, construction, materials, labor…) Quality of location services (policy, banking, insurances…) Local regulation Other utilities (water supply, power, sewer…)

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Layout building office equipment and environment workflow systems

Designing production/Operation processIt is flow line of production or services.example:

InputOutputRaw material Productsor Customer Services

Material

Labor

1 2 3 4Work Station

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Planning Inventory right goods in the right quantity at the right

time and place.

Example: JIT methodQuality Control

meet certain standards.Forecasting production

using past and current information to predict future production.

Production requirements=PS+DEI-BI2050 units = 2000+200-150

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3-Organizational Strategy Deciding on a legal form of the organization

Sole Proprietorship Partnership Corporation

Staffing What types of employees are needed? How many employees are needed? How should employees be recruited and

trained? How should employees be compensated

and motivated?

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4-Financial ProjectionPro forma income statement: Pro forma balance sheet: Cash Budget: Break event point:

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Fixed Cost

Variable Cost

Volume of output

Profit areaRevenue

Loss area

Break-even point

TC=TS

P x Qo=FC+VC

P x Qo=FC+V x Qo

P x Qo-V x Qo=FC

Qo(P-V)=FC

Qo=FC/(P-V)

Qo Q0

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III-decision making1.What is decision making?It is the process of identifying problems and opportunities and resolving them.2.types of managerial decision making

A-Programmed Vs Non-programmed decision making

Programmed decision: The process of identifying a problem and matching the problem with established routines and procedures for resolving it.

Non-program decision: The process of identifying a problem when a situation is unique and there are not previously established routines or procedures that can be used as guides.

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B-Proactive Vs Reactive decisions Proactive decision: a decision made in

participation of an external change or other conditions.

Reactive decision: the decision made in response to external changes.

C-Intuitive Vs Systematic decisions Intuitive decision: a process of

estimating or guessing to decide among alternatives.

Systematic decision: an organized, exacting, data driven process for choosing among alternatives.

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3.Decision making process

Step1

Find and defined

the source of problem

Step2

Generate and valuatealternative solution

Step3

Select preferred solution

Step4

Implementthe solution

andmonitoring

Recycle process as necessary

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Step1: Identify the problemScan environment and emergence of potential problem.Categorize the situation as a problem or not.Try to understand the nature/cause of the problem.Step2: Develop alternative solutionsTry to develop as many alternatives as possible by using such techniques as brainstorming.Try to be non-judgmental of potential solution at this stage

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Step3: Evaluate and select among alternativesEvaluate feasibility of implementationEvaluate qualityEvaluate acceptabilityEvaluate reversibilityEvaluate costsEvaluate ethicsStep4: Implement and monitor the solution selectedPlan and implement the chosen solutionBe sensitive to the decision that could effects on othersdevelop follow-up mechanisms

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4-Indivual and Group decision makingA-Individual decision making

B-Group decision making