MGT10001 Week 3 Planning - Choosing a goal and developing a strategy to achieve the goal - Planning provides direction - Offers some benefits and some pitfalls Works for you by: - Intensifying effort - Increasing persistence - Providing direction - Creation of task strategies Works against you by: - Impeding change - Creating a false sense of certainty - Detachment of planners How to make a plan that works 1. Set goals (specific, measurable, attainable, realistic, timely) 2. Develop commitment (setting goals participatively, making goals reasonable, making goals public, obtaining top management support) 3. Develop effective action plans (specific plans are more effective than vague ideas, answer questions like how, who, what, when) 4. Track progress toward goal achievement (set both proximal and distal goals, gather, analyse, interpret performance data and make corrections as necessary) 5. Maintain flexibility Option based planning - keep options open by making small, simultaneous investments in many alternative plans. Invest more in promising options Maintains slack resources - a cushion of extra resources that can be used with options - based planning to adapt to unanticipated change, problems or opportunities) Top managers - strategic plans (overall company plans that clarify how the company will serve customers and position itself against competitors) vision (a brief statement of a company's purpose) , mission (statement of a company's overall goal that unifies company wide efforts towards its vision, stretches and challenges the organisation and possesses a finish line and time frame. Middle managers - tactical plans, management by objectives (discuss possible goals, select goals that are challenging, attainable and consistent with companies overall goals, jointly develop tactical plans that lead to the accomplishment of tactical goals and objectives, meet regularly to review progress) First level managers - operational plans (day to day plans, developed and implemented by lower level managers, to direct the behaviour and efforts of opertitive employees for period ranging from 30days to 6 months), standing plans (used repeatedly to handle frequently
recurring events), sinple use plans (cover unique, one time only events), policy (a standing plan that indicate general course of action that should be taken response to a particular event) Rational decision making Decision making - process of choosing a solution from available alternatives Rational decision making - systematic process of defining problems, evaluating alternatives and choosing optimal solutions Limits to rational decision making - Managers make decisions under constraints eg. limited time, finances, information and so on - Instead of maximising (choosing best alternative), they satisfice (choose a 'good enough' option) Group decision making Advantages - Problems can be viewed from multiple perspectives - More information can be found - More alternative solutions generated - More commitment to making chosen solutions work Disadvantages - Susceptibility to groupthink and to considering a limited number of solutions - Groupthink is a barrier to good decision making caused by pressure within the group for members to agree with each other - Takes considerable time - One or two people can dominate group discussion - Members