Course & Section: ESC 21 B1 change resulting from an

organization or program’s work

b. Needs to be clear and simple; avoid
Planning elaborate language; easily
explained.
- Most basic managerial function c. Answers the question: which needs
- Deciding in advance what to do, how to do it, to be changed? What is your dream
when to do it, and who will do it. end state? What would success look
- Provides rational approach to pre-selected life?
objectives
- Change and economic growth bring
opportunities but also risks Purpose or Mission
- The task of planning to minimize risks
- Nature of planning: - Every social enterprise has a basic function
- - To be meaningful, an organization must have a
a. Its purpose is to facilitate the purpose or mission
accomplishment of enterprise - A clear statement of a mission is necessary to
objective and purpose formulate meaningful objectives
b. Planning preceded execution - In business organization, the purpose is stated
c. It is the function of all managers in the articles of incorporation
d. The efficiency of plan is measured - Mission statement:
by the amount it contributes to the a. (What you do); describes the
purpose and objectives as offset by reason an organization exists and
the cost and other unsought used to help guide decisions about
e. Consequences required to formulate priorities, actions, and
and operate it responsibilities
b. Should be clear and simple
- Planning process: c. Answers the questions: what type of
a. Establishes the activities necessary entity or program? Why do you exist
to meet designated objectives (problems or issue). What is the
b. The work of determining and broadest way to describe your work,
specifying objectives, policies, for whom do you do your work?
programs, organizational Where do you work?
relationships, procedures, and
budgets
Example of Vision-Mission statements
- Types of plans
- Habitat for Humanity
a. Vision, mission, purpose - Vision: A world where everyone has a decent
b. Objectives place to live
c. Strategies - Mission: Seeking to put God’s love into action.
d. Policies – major and minor Habitat for Humanity brings people together to
e. Procedures and rules build homes, communities, and hope.
f. Programs – major, minor,
supporting
g. Budgets Objectives or Goals

- Are ends
- Objectives become basis
Vision
- Are measurable and time bounded
- All organizations have a vision
- How does the organization see itself in the
Objectives are SMART
future. Most often a period is set like how the
organization sees itself in the next 10 years. S Specific e.g., To have a 10% profit on a
- Vision statement: P15 M building project to be
a. (Desired end-state); a one sentence constructed in 300 days
statement describing clear and M Measurable Estimate
inspirational long-term desired A Attainable Based on estimate
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 R Relevant For the continued business of the
company
T Time Construction
bound
Strategies
- General program of action. An implied
deployment of emphasis and resources to attain
comprehensive objective. The basic long-term
goals and objectives are determined to be
followed by adoption of courses of action and
the allocation of resources that are necessary to
carry out these goals.
- Strategies determine and communicate through
a system of major objectives and policies, a
picture of what kind of enterprise is envisioned.
They are useful framework for guiding enterprise
thinking and action. It may include competitive
consideration.
- Strategies using the example on construction:
a. Negotiate for down payment
b. Canvass materials to be used. For
the lowest price materials, peg the
price by depositing a cash advance
with the down payment
c. Supervise workers closely to
increase productivity
d. Plan the work so that forms can be
used several times
e. Sub-contract some work like
painting, tile laying, plumbing to
reduce labor cost
f. Make a cutting lit for steel
reinforcement to reduce wastage
g. Use commercial concrete mix
Policies
- General statement or understanding; guide or
channel thinking and action in decision making
- Delimit within a decision is to be made and
assure that the decision will be consistent with
and contribute to objective
- Policies should allow for discretion otherwise
policies become rules
- May have as many levels as departments as
there are in a company; should be regarded as
means of encouraging discretion and initiative
within limits
- Examples of policies for construction
a. Require all laborers to have
barangay, police, and NBI clearance
b. Pay laborers the legal minimum
wages and have graduated pay
scale for skilled workers depending
on skill
c. Workers should be enrolled in SSS,
Pag-ibig, and Philhealth
Characteristics of Sound Policy
1. Based on objectives.
Should relate to personal objectives of individual
and groups interested in the business to the
organizational objectives.
2. Relate objectives to functions, physical factors,
and personnel.
Policy aids all levels of management by limiting
the possible alternative course from which a
manager can choose; the manager can plan
within a policy framework.
3. Conforms to ethical standards.
Underline policies governing correct business
relations.
4. Simple and understandable.
Should not be a source of misunderstanding and
should be codified.
5. Stable and flexible.
Changes only in response to fundamental
changes in the business condition.
6. Sufficiently comprehensive.
Should cover all possible necessary actions of
the organization.
7. Complementary and supplementary.
Policies cover situations where various units
cooperate with one another.
Procedures
- Customary method of handling future activities ;
guides for action; set for entire organization,
division, and departments
- Usually stated in the Manual of Operation
Rules
- Required action from alternatives, simplest of
plans.
- Requires a specific and definite action be taken
or not taken with respect to a situation
- Should not be confused with procedure or
strategy
- May or may not be part of a procedure
- Allows no discretion in their application
- Example of Rules on Construction
a. No smoking during work
b. Use harness when working at high
elevation
c. Work tools should be sharpened before
the start of work
d. Wear hardhat
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Programs Requires diagnosis of the opportunity; what the
customers want; strength and weaknesses of
- Complex of goals, policies, procedures, rules, the organization.
task assignment, steps to be taken, resources to 2. Establish objective or goals.
be employed, and other elements necessary to Where one wants to be; what one wants to
carry out a given course of action accomplish and when is this to be
- Supported by capital and operating budgets accomplished; objective of the entire
- A primary program may call for many derivative organization is first established then the
programs objectives of the subordinate units.
- Examples of Programs in Construction: 3. Consider planning premises.
What environment (internal, external) will the
a. Train unskilled laborers to gain skill plan operate; forecast data of factual nature;
by assigning them as helpers to limit premises to those critical or strategic to a
skilled worker plan, or those that most influence its operation;
b. Train skilled workers to be multi- use of consistent premise; managers should be
skilled aware of the premise where the plan is made to
c. Send technical staff to relevant avoid inconsistency.
seminars and training 4. Identify alternatives.
Budgets Define the most promising alternatives to
accomplish the objective; what is not obvious
- Numerical compilation of cash flow, expense may prove to be the best; sometimes
and revenues, capital outlay, labor, machine mathematical techniques and computer
hour utilization simulation are used to reduce alternatives
- Varies in accuracy, detail, and ways of 5. Compare alternatives.
developing Which gives the best chance of meeting goals at
the lowest cost and highest profit; evaluate each
alternative using various factors such as cash
For the project, prepare a vision and mission statement outlay, payback period, risks, long and short-
and a list of objectives to attain your vision for your range objectives, profitability, and intangibles.
business. 6. Choose an alternative.
Select the course of action to pursue;
sometimes, several courses of action are
followed instead of just one.
Preparing Simple Case Study
7. Formulate supporting plans.
Stages: Derivative plans to support basic plan.
8. Prepare budgets.
Volume, price of sales, operating expenses,
capital requirements; these can be overall and
1. Get familiar with the case situation (facts,
departmental budgets.
persons, activities, context)
2. Recognize symptoms (what are the things that
are not as expected or as they should be)
3. Identify goals and objectives Criteria of an effective plan
4. Conduct analysis
5. Make the diagnosis (identify problems,
discrepancies between goals and performance, 1. Clearly state the nature of mission and
prioritize problems) objectives
6. Prepare action plan (identify feasible action 2. Provide measures of satisfactory
alternatives, conducting a course of action, accomplishment of the objectives in terms of
implementation planning, plan for monitoring quantity, quality, time, and expense
implementation) 3. State policies which guide people in
7. Write the case study accomplishing the mission
4. Indicate what organizational units are involved
5. Indicate time allowed for each phase of activity
Steps in Planning 6. Specify the kind and number of allowable
manpower and expense factor
1. Be aware of opportunity.

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 7. Designate executive leaders who will be held
accountable for the accomplishment of the
mission and each phase of it

Characteristics of a sound business plan

1. Objectives: not be distorted by bias or

emotionalism resulting emphasis in personal
and not organizational objectives
2. Clear, logical, and simple: effective execution of
plan depends upon its being understood by
those who will implement it; one of the ways for
it to be understood is by getting the people
involved to participate in preparing it; discuss it
with interested parties; unnecessary complexity
compounds the difficulty in executing the plan
3. Controllable: ability to plan economically and
effectively depends upon ability to foresee future
events with accuracy; businesses should
provide for periodic reviews, analyses and
projections of business conditions and probable
effect on the business
4. Flexible: can be adjusted smoothly and quickly
to the requirements of changing conditions
without serious loss to economy and
effectiveness; requires flexible managers
5. Stable: one that will not be abandoned or
subject to fundamental modification because of
changes in external factors
6. Complete and integrated: comprehensive
enough to cover all actions required of
individuals and organization

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