191 6thsept.planning. 2012
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Planning 6th SepTRANSCRIPT
By the end of this class you will have
Gained an understanding of the decision making and planning process
Considered your own decision making preferences
Considered different decision making models Considered strategic and operational
planning
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A Very Simple View of the Management Process
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Planning
Organising
Leading
Controlling
. ..the direction
...the resources to coordinate
...getting the people to make the effort
...ensuring all goes well
But what did you find out in A Day in the Life exercise?
Did the labels describe the reality of managerial work? Did your DIL manager talk about their ‘planning’ and
leading’ roles? Do managers act out such roles, putting on different
hats? e.g. on goes the planning hat? Of course they set aside time for planning, say a
project meeting but how often?Do they look to see if their plans are on course ie
control?Managing in SME is informal, talking, developing
relationships, ‘fighting fires’, trying to motivate the ‘reluctant.’
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Individual decision-making
Starts with need to know e.g. How are we going to present our case? What alternative ways could we use?
Consider the optionsCriteria for making our decision e.g. time availableRank optionsDecide
Did we set out to satisfice or optimise?Then the Doing stage
How do you make decisions?What is your ‘plan’ for the rest of the day?What decisions do you have to make today? This
week?What are your plans for the next six weeks?For the exams?For the coming summer ( it will arrive)?What is your plan for your degree?For 2012? Beyond?What career plans do you have?What criteria do you apply?How do you go about planning?
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How do you pull information together to make decisions?
Are you a ‘picture person’ or a list ‘person’?Do you use a wall planner?Do you use a spreadsheet like Excel? Or do you keep it all in your head or rely on your
diary?How do you weigh up different alternatives? What
criteria do you use? For example, holiday vs chance to earn cash for next semester?
Are you an ‘intuitive’ decision makers or a ‘rational’ decision maker?
How do you go about making personal decisions? e.g. alcohol?
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Steps in the Decision Making ProcessSteps in the Decision Making Process
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Identifythe problem [or opportunity]
Generate alternativesolutions
Evaluate possible solutions
Choose an alternative
Implement
Evaluate results (decision effectiveness)
The Rational Decision Making ModelThe Rational Decision Making Model
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Identify the problem and list alternatives
& consequences
Rank each alternative from low to high
Select bestalternative
Assumes all informationis available to manager
Assumes manager canprocess information
Assumes manager knowsthe best future course of
the organization
Classical DM model see text p 75
Behavioural Model: SatisficingBehavioural Model: Satisficing
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Identify the problem
Seek an alternativeonly until finding onethat is satisfactory
May not beOptimal decision
Time constraints
Limited ability to understand all factors
Inadequate base of information
Limited memory of Decision makers
Poor perception of factorsTo be considered
In decision process
Administrative DM model
Limitations to Decision-making
Bounded Rationality: the ability of managers to make rational decisions is limited by factors such as cognitive ability and time constraints
Incomplete information: always inaccurate, ambiguous or incomplete
Satisficing model: manager seeks alternatives until find one “good enough” rather than finding the optimal alternative
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The Planning Process
Planning is about deciding what to accomplish and how to do it
SMART objectives: Specific Measurable Attainable Realistic Time bound
Types of Plans
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Short-Range
Long-RangeStrategic
Operational
Objectives drive everything. . .ExampleYour tutorial case presentationWhat are our objectives?1. Your COMMUNICATION objectives2. Your ACTION objectivesWhat do you want the other students to go away
knowing?What objectives drive your analysis and
presentation?They are the ‘acid’ test: were we successful, did
we achieve our objectives?Do we need to state them? YES. 12
Types of plansStrategic
Long-term e.g. 5-10 yearsConcerned with overall direction, the ‘big
picture’Impact of the environment on the organisation Top drivenNeeds accurate, comprehensive information
based on researchLong lead time before feedback
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OperationalTurning the strategy into realitye.g. production planning
human resource planningLower levelMore immediate feedback e.g. customer
satisfaction
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Why is planning difficult?
Incomplete informationCost of obtaining additional informationAssumptions we make e.g. rationalityLack of control over externalities e.g.
earthquakePower dynamics in organisations e.g. a
difficult student in your groupThe human element e.g. never certainty
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Is planning more difficult today than 20 years ago?
Rapid change Turbulent environments e.g global warming Changing technology e.g information
revolutionIncreased competition e.g FTA with ChinaGlobalisation e.g Fisher & Paykel decision to
relocate to Thailand
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What the planning process is not…
‘A plan is not a strategy, an intention is not a plan.’
Critically discuss this statement with the regard to the planning process