Planning and Control

Table Of Content 1. Introduction Planning 3 2. Planning 3 2. 1Goals3 2. 2Plans4 2. 2. 1 The Planning Process5 3. Controlling the Management Process6 3. 1Steps in Control6 3. 2Areas of Control7 3. 3Characteristics of Control7 4. Conclusion8 Reference 1. Introduction Of the four fundamental tasks of management I have chosen to discuss the first and forth steps of management which are Planning and Controlling the management process. Planning is the basis for the rest of the management functions. The two core components in the planning stage are goals and planning process.Goals are the destination of the organisation, they indicate where the organization is heading, planning is the route mapped out to achieve the goals, the steps taken and the changes that are to be made in order for the organization to reach said goals Planning Planning promotes co-ordination in the company where all departments work together to reach the pre-determined goal. Therefore teamwork and interdepartmental co- operation and communication are essential to work toward a primary goal. Management plan and formulate goals which are later used to assess control .The cost of the planning process may be time consuming. A lot of time and energy is needed to plan and strategize goals, this may cause a backlog in the management schedule. Planning may become rigid, not allowing any time to stray from the plans even the budget does not allow for it. The formal planning phase may also become a routine rather than viewed as a challenge thus the initial vigour and creatively may diminish over time. 1. 1Goals Goals are the starting point of any planning phase; they start from a mission statement and grow more specific.Organisations may have multiple goals the type of goal set is influenced by the level at which it is set. Goals are either stated publicly or not, this is determined by the degree of openness of the company. Official goals are declared publically to the media. Operative goals are private goa ls which are kept within the organization. Criteria for effective goals to improve chances of success achieving goals, managers should ensure that goals are not ambiguous. The SMART framework states that goals should be specific Goals should be Specific, it indicates what the goal relates to -Measurable , result can be evaluated in quantifiable terms -Attainable, challenging yet realistic -Relevant, relates to organisations mission and strategy -Time Bound, specified time line to instil a sense of urgency A goal setting technique : Management by objectives is a technique whereby the individual and Management goals are integrated toward on primary goal. Advantages of MBO The efforts of managers and employees focus on attaining organisational goals The organisations performance can improve Employees are motivatedIndividual goals align with organisational goals Disadvantages of MBO Constant change in the environment can cause frequent change in organisational goals Poor relations betwe en managers and employees reduce the effectiveness of MBO Operational goals may displace strategic goals The organisational culture may discourage effective use of MBO MBO can result in too much paperwork 2. 2 Plans Plans are the ‘blueprints’ of achieving goals. It is an indicator of how goals are to be reached. It specifies resources to be used, the period in which the plans must be implemented.Managers consider many alternate plans of actions and choose one or a few plan of action that may be most feasible this includes External factors such as environment and market stability, strengths and weaknesses of the company and staff as a whole as It is best to work to the strengths of the company taking into account skills, patent, capital and the image of the organisation. 2. 2. 1 The planning process Variables set the parameters within which the managers can formulate realistic organisational goals and plans.Planning in context, uses five variables namely, purpose, Missio n statement, Environment, Values of Managers and Experience of Managers. In each organisation the purpose must be clear. The organisation must take into account its social responsibility, job creation and how to improve its product. The mission statement states a clear defined goal. The organisation is constantly adapting the economic environment may cause the plan to change, money may not be available to attain goal, a new route must be planned. Thus with Managers the organisational culture and work ethic must be in line with the organisations view and have relevant experience.Establish a goal, several different alternative plans are looked at of which the most feasible plan is selected. This plan is then implement and monitored, called reactive planning. Planning happens on three levels of the organisation, top level – long term strategic goals, middle level- medium term tactical goals, and lower level – short term operational goals for their department. There are di fferent types of goals and plans. Strategic, Tactical and Operational. Strategic goals and plans involve the company as a whole long term goals and not specific function or operation.These aim to improve the image of the company and market the product to the masses to increase business opportunity strengthen the company and foundation in the market place by increasing sales and demand of the product. Tactical Goals, for middle management for functional area goals and how to carry out these tasks. These are medium or short term goals derived from the long term goals and are focused goals. Operational goals , are short term goals no longer than a year that deal with the day to day running of the company which are unit goals and operational standards.These require programs that are followed, targets to be reached, budgets and projects that need to be completed. 2. Controlling the management process The forth step of fundamental management where the assessment of actual performance agai nst planned performance initiates a new cycle of planning, organising , leading and control. Organisations use controls to ensure that they progressing toward their goals. Although it is the final step it forms the basis of a new cycle as it gives feedback as to what is working and what needs to changed. The purpose of control is to align goals and actual performance.Control helps organisations adapt to environmental change, helps limit error, ensures companies cope with growing complexity most importantly It helps minimizes financial implications. 3. 1 Steps In Control Establish performance standards at strategic point and is a mirror image of planning, as the plans indicate the goals and setting of standards or norms necessary for control. Measuring actual performance is based on assessing quantifiable, reliable results before any valid comparisons are made. Evaluate deviations the results are measured to assess if the target is near or far from the goal.At this stage the gap betw een below average, level or exceeds expectations are evaluated Take corrective action, the results are evaluated and strategy adjusted to achieve required result. 3. 2 Areas of control Most organisations define areas of four different types of resources, Generally human, financial physical and information resources are deployed to achieve specific goals. Physical control, are the inventory items like raw material deliveries on time so that production is not interrupted. Quality control, involves the product is made without fault.Human resources involves orderly placement and selection of staff , using regular job performance evaluations to make sure the standards are not slipping. Information resources are the accurate marketing and forecasting of the product, financial resources are the budgeting. Financial resources are at the centre of control as it enables and restricts the amount of control and planning executed by the company due to affordability. 3. 3 Characteristics of effec tive control system Integration – control system is more effective when it is integrated with planning.The closer links between control and planning the better the eventual control system will be. Flexibility – the system should be able to accommodate change . adjustments that are not regarded as deviations but rather revision of plans. Accuracy – provides an accurate objective, errors and deviations should not be concealed in the data. Timeliness control data should be supplied regularly as needed and not be taken hastily. Simplicity – a complex system is viewed as an obstacle because they can have a negative influence on the sound judgement of competent managers.Too much information can be demotivating and place great demand on time and attention of management which means that the control will become too expensive. Conclusion. The Importance of Goals are that they are unidirectional, meaning that the company moves towards a primary goal using a clearly formulated action. Planning ensures that the company has the resources to reach their goals and controlling the processes is the ever changing adapting process to keep the company on track to achieve the intended goal. REFERENCE : INTRODUCTION TO BUSINESS MANAGEMENT; TOIT, ERASMUS, STRYDOM; OXFORD UNIVERSITY ; EIGHTH EDITION