Page 175 - Fundamentals of Management Myths Debunked (2017)_Flat

5 Review

CHAPTER SUMMARY

5-1 Discuss the nature and purposes service, employee skills and loyalty, innovation, quality,
of planning. social media, and big data.

5-3 Compare and contrast approaches to goal
As the primary management function, planning establishes the
basis for all the other things that managers do. The planning setting and planning.
we’re concerned with is formal planning; that is, specific goals
covering a specific time period are defined and written down The goals of most companies are classified as either strategic or
and specific plans are developed to make sure those goals are financial. We can also look at goals as either stated or real. In
met. There are four reasons why managers should plan: (1) it traditional goal setting, goals set by top managers flow down
establishes coordinated efforts; (2) it reduces uncertainty; (3) it through the organization and become subgoals for each orga-
reduces overlapping and wasteful activities; and (4) it estab- nizational area. Organizations could also use management by
lishes the goals or standards that are used in controlling work. objectives, which is a process of setting mutually agreed-upon
Although criticisms have been directed at planning, the evi- goals and using those goals to evaluate employee performance.
dence generally supports the position that organizations benefit Plans can be described in terms of their breadth, time frame,
from formal planning. specificity, and frequency of use. Plans can be developed by
a formal planning department or by involving more organiza-
5-2 Explain what managers do in the strategic tional members in the process.
management process.
5-4 Discuss contemporary issues in planning.
Managers develop the organization’s strategies in the
strategic management process, which is a six-step process One contemporary planning issue is planning in dynamic envi-
encompassing strategy planning, implementation, and ronments, which usually means developing plans that are spe-
evaluation. The six steps are as follows: (1) Identify the or- cific but flexible. Also, it’s important to continue planning even
ganization’s current mission, goals, and strategies; (2) do an when the environment is highly uncertain. Finally, because
external analysis; (3) do an internal analysis—steps 2 and 3 there’s little time in a dynamic environment for goals and plans
together are called SWOT analysis; (4) formulate strategies; to flow down from the top, lower organizational levels should
(5) implement strategies; and (6) evaluate results. The end be allowed to set goals and develop plans. Another contempo-
result of this process is a set of corporate, competitive, and rary planning issue is using environmental scanning to help do
functional strategies that allow the organization to do what a better analysis of the external environment. One form of envi-
it’s in business to do and to achieve its goals. Six strategic ronmental scanning, competitive intelligence, can be especially
weapons are important in today’s environment: customer helpful in finding out what competitors are doing.

DIsCussIon quEsTIons

5-1 Why are formal plans generated? 5-7 Describe how managers can plan in today’s dynamic
5-2 Discuss why planning is beneficial. environment.
5-3 Describe in detail the six-step strategic management 5-8 What types of planning do you do in your personal life?
process. Describe these plans in terms of being (a) strategic or
operational, (b) short term or long term, (c) specific or
5-4 How would SWOT analysis strengthen the strategic directional, and (d) single-use or standing.
management process—externally and internally?
5-9 Do a personal SWOT analysis. Assess your personal
5-5 “Organizations that fail to plan are planning to fail.” strengths and weaknesses (skills, talents,). What are you
Agree or disagree? Explain your position. good at? What are you not so good at? What do you
5-6 Managers can’t empower all employees—in this enjoy doing? Not enjoy doing? Then, identify career
context, explain how MBO is effective. opportunities and threats by researching job prospects

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