11/1/2022

FUNCTIONS OF
MANAGEMENT PLANNING

PLANNING AT VARIOUS
DEFINITION MANAGEMENT LEVEL

• THE MANAGEMENT FUNCTIONS THAT INVOLVES 1. TOP MANAGEMENT LEVEL

ANTICIPATING FUTURE TRENDS AND DETERMINING THE STRATEGIC PLANNING – THE PROCESS OF DETERMINING THE MAJOR
BEST STRATEGIES AND TACTICS TO ACHIEVE GOALS OF THE ORGANIZATION AND THE POLICIES AND STRATEGIES FOR
ORGANIZATIONAL OBJECTIVES. (NICKELS AND OTHERS) OBTAINING AND USING RESOURCES TO ACHIEVE THOSE GOALS.
2. MIDDLE MANAGEMENT LEVEL
• THE SELECTION AND SEQUENTIAL ORDERING OF TASKS
INTERMEDIATE PLANNING – THE PROCESS OF DETERMINING THE
REQUIRED TO ACHIEVE AN ORGANIZATIONAL GOAL. CONTRIBUTIONS THAT SUBUNITS CAN MAKE WITH ALLOCATED RESOURCES.
(ALDAG AND STEARNS)
3. LOWER MANAGEMENT LEVEL
• DECIDING WHAT WILL BE DONE, WHO WILL DO IT, WHERE, OPERATIONAL PLANNING – THE PROCESS OF DETERMINING HOW
WHEN, AND HOW IT WILL BE DONE, AND THE STANDARDS SPECIFIC TASKS CAN BEST BE ACCOMPLISHED ON TIME WITH AVAILABLE
TO WHICH IT WILL BE DONE. (COLE AND HAMILTON). RESOURCES.

THE PLANNING PROCESS TYPES OF PLANS

1. SETTING ORGANIZATIONAL, DIVISIONAL OR UNIT GOALS 1. FUNCTIONAL AREA PLANS

GOALS – PRECISE STATEMENT OF RESULTS SOUGHT, QUANTIFIED IN a. MARKETING PLAN – WRITTEN DOCUMENT OR BLUEPRINT FOR IMPLEMENTING AND
TIME AND MAGNITUDE, WHERE POSSIBLE. CONTROLLING AN ORGANIZATION’S MARKETING ACTIVITIES RELATED TO A
PARTICULAR MARKETING STRATEGY.
2. DEVELOPING STRATEGIES OR TACTICS TO REACH GOALS
b. PRODUCTION PLAN – WRITTEN DOCUMENT THAT STATES THE QUANTITY OF
STRATEGY – A COURSE OF ACTION AIMED AT ENSURING THAT THE OUTPUT A COMPANY MUST PRODUCE IN BROAD TERMS AND BY PRODUCT FAMILY.
ORGANIZATION WILL ACHIEVE ITS OBJECTIVES.
c. FINANCIAL PLAN – IT IS A DOCUMENT THAT SUMMARIZES THE CURRENT
3. DETERMINING RESOURCES NEEDED FINANCIAL SITUATION OF THE FIRM, ANALYZES FINANCIAL NEEDS, AND
RECOMMENDS A DIRECTION FOR FINANCIAL ACTIVITIES.
4. SETTING STANDARDS
d. HUMAN RESOURCE MANAGEMENT PLAN – IT IS A DOCUMENT THAT INDICATES THE
STANDARD – A QUANTITATIVE OR QUALITATIVE MEASURING DEVICE HUMAN RESOURCE NEEDS OF A COMPANY DETAILED IN TERMS OF QUANTITY AND
DESIGNED TO HELP MONITOR THE PERFORMANCES OF PEOPLE, CAPITAL GOODS OR QUALITY AND BASED ON THE REQUIREMENTS OF THE COMPANY’S STRATEGIC
PROCESSES. PLAN.

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TYPES OF PLANS . . . TYPES OF PLANS . . .

2. PLANS WITH TIME HORIZON
PROCEDURES – THEY ARE PLANS THAT DESCRIBE THE EXACT
a. SHORT-RANGE-PLANS – PLANS INTENDED TO COVER A PERIOD OF LESS THAN SERIES OF ACTIONS TO BE TAKEN IN A GIVEN SITUATION.
ONE YEAR.
RULES – THEY ARE STATEMENTS THAT EITHER REQUIRE OR
b. LONG-RANGE-PLANS – PLANS COVERING A TIME SPAN OF MORE THAN ONE
FORBID A CERTAIN ACTION.
YEAR.
3. PLANS ACCORDING TO FREQUENCY OF USE 2. SINGLE-USE PLANS – SPECIFICALLY DEVELOPED TO IMPLEMENT
COURSES OF ACTION THAT ARE RELATIVELY UNIQUE AND ARE
a. STANDING PLANS – USED AGAIN AND AGAIN AND THEY FOCUS ON
UNLIKELY TO BE REPEATED.
MANAGERIAL SITUATIONS THAT RECUR REPEATEDLY.
POLICIES – THEY ARE BROAD GUIDELINES TO AID MANAGERS AT EVERY a. BUDGET – A PLAN WHICH SETS FORTH THE PROJECTED
LEVEL IN MAKING DECISIONS ABOUT RECURRING SITUATIONS OR FUNCTIONS. EXPENDITURE FOR A CERTAIN ACTIVITY AND EXPLAINS WHERE
THE REQUIRED FUNDS WILL COME FROM. (WESTON AND BRIGHAM)

PARTS OF THE VARIOUS

TYPES OF PLANS . . . FUNCTIONAL AREA PLANS
1. THE CONTENTS OF THE MARKETING PLAN
a. THE EXECUTIVE SUMMARY – WHICH PRESENTS AN OVERALL VIEW OF THE

b. PROGRAM – DESIGNED TO COORDINATE A LARGE SET b.

MARKETING PROJECT AND ITS POTENTIAL.
TABLE OF CONTENTS
OF ACTIVITIES.
c. SITUATIONAL ANALYSIS AND TARGET MARKET
c. PROJECT – USUALLY MORE LIMITED IN SCOPE THAN A d. MARKETING OBJECTIVES AND GOALS
PROGRAM AND IS SOMETIMES PREPARED TO SUPPORT e. MARKETING STRATEGIES

A PROGRAM. f. MARKETING TACTICS

g. SCHEDULES AND BUDGETS
h. FINANCIAL DATA AND CONTROL

PARTS OF THE VARIOUS PARTS OF THE VARIOUS

FUNCTIONAL AREA PLANS . . . FUNCTIONAL AREA PLANS . . .
2. THE CONTENTS OF THE PRODUCTION PLAN

a.
4. CONTENTS OF THE HUMAN RESOURCE PLAN
THE AMOUNT OF CAPACITY THE COMPANY MUST HAVE

b. HOW MANY EMPLOYEES ARE REQUIRED

c.
3.
HOW MUCH MATERIAL MUST BE PURCHASED

THE CONTENTS OF THE FINANCIAL PLAN

a. PERSONNEL REQUIREMENTS OF THE COMPANY
a. AN ANALYSIS OF THE FIRM’S CURRENT FINANCIAL CONDITION AS INDICATED BY AN ANALYSIS OF THE
MOST RECENT STATEMENTS. b. PLANS FOR RECRUITMENT AND SELECTION
b.
c.
A SALES FORECAST

THE CAPITAL BUDGET

c. TRAINING PLAN
d.
e.
THE CASH BUDGET

A SET OF PRO FORMA (OR PROJECTED) FINANCIAL STATEMENTS

d. RETIREMENT PLAN
f. THE EXTERNAL FINANCING PLAN

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PARTS OF THE STRATEGIC

MAKING PLANNING EFFECTIVE
PLAN

1. COMPANY OR CORPORATE MISSION

1. RECOGNIZE THE PLANNING BARRIERS.
2. OBJECTIVES OR GOALS
2. USE OF AIDS TO PLANNING
3. STRATEGIES

AMONG THE AIDS TO

PLANNING BARRIERS
PLANNING THAT MAY BE USED

1. MANAGER’S INABILITY TO PLAN

2. IMPROPER PLANNING PROCESS
3. LACK OF COMMITMENT TO THE PLANNING PROCESS 1. GATHER AS MUCH INFORMATION AS POSSIBLE
4. IMPROPER INFORMATION 2. DEVELOP MULTIPLE SOURCES OF INFORMATION
5. FOCUSING ON THE PRESENT AT THE EXPENSE OF THE FUTURE 3. INVOLVE OTHERS IN THE PLANNING PROCESS
6. TOO MUCH RELIANCE ON THE PLANNING DEPARTMENT
7. CONCENTRATING ON ONLY THE CONTROLLABLE VARIABLES

DEFINITION

•A
ORGANIZING
MANAGEMENT FUNCTION WHICH REFERS TO THE
STRUCTURING OF RESOURCES AND ACTIVITIES TO
ACCOMPLISH OBJECTIVES IN AN EFFICIENT AND
EFFECTIVE MANNER.

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THE PURPOSE OF THE

STRUCTURE STRUCTURE
1. IT DEFINES THE RELATIONSHIPS BETWEEN TASKS AND
AUTHORITY FOR INDIVIDUALS AND DEPARTMENTS.
2. IT DEFINES FORMAL REPORTING RELATIONSHIPS, THE NUMBER
OF LEVELS IN THE HIERARCHY OF THE ORGANIZATION, AND
• THE ARRANGEMENT OR RELATIONSHIP OF POSITIONS THE SPAN OF THE CONTROL.
WITHIN AN ORGANIZATION. 3. IT DEFINES THE GROUPINGS OF INDIVIDUALS INTO
DEPARTMENTS AND DEPARTMENTS INTO ORGANIZATION.
4. IT DEFINES THE SYSTEM TO EFFORT COORDINATION OF
EFFORT IN BOTH VERTICAL (AUTHORITY) AND HORIZONTAL
(TASKS) DIRECTION.

FORMAL
STRUCTURE . . . ORGANIZATION
• WHEN STRUCTURING AN ORGANIZATION, THE ENGINEER MANAGER MUST BE • THE STRUCTURE THAT DETAILS LINES OF RESPONSIBILITIES,
CONCERNED WITH THE FOLLOWING: AUTHORITY AND POSITION.
1. DIVISION OF LABOR – DETERMINING THE SCOPE OF WORK AND HOW IT IS • THE FORMAL STRUCTURE IS DESCRIBED BY MANAGEMENT THROUGH:
COMBINED IN A JOB.
2. DELEGATION OF AUTHORITY – THE PROCESS OF ASSIGNING VARIOUS
1. ORGANIZATION CHART – IS A DIAGRAM OF THE ORGANIZATION’S
DEGREES OF DECISION-MAKING AUTHORITY TO SUBORDINATES. OFFICIAL POSITIONS AND FORMAL LINES OF AUTHORITY.

3. DEPARTMENTATION – THE GROUPING OF RELATED JOBS, ACTIVITIES, OR 2. ORGANIZATIONAL MANUAL – PROVIDES WRITTEN DESCRIPTIONS
PROCESSES INTO MAJOR ORGANIZATIONAL SUBUNITS. OF AUTHORITY RELATIONSHIPS, DETAILS THE FUNCTIONS OF
MAJOR ORGANIZATIONAL UNITS AND DESCRIBES JOB
4. SPAN OF CONTROL – THE NUMBER OF PEOPLE WHO REPORT DIRECTLY TO A
GIVEN MANAGER. PROCEDURES.

5. COORDINATION – THE LINKING OF ACTIVITIES IN THE ORGANIZATION 3. POLICY MANUAL – DESCRIBES PERSONNEL ACTIVITIES AND
THAT SERVES TO ACHIEVE A COMMON GOAL OR OBJECTIVE. COMPANY POLICIES.

INFORMAL TYPES OF ORGANIZATIONAL

ORGANIZATION STRUCTURE
1. FUNCTIONAL ORGANIZATION – THIS IS A FORM OF
DEPARTMENTALIZATION IN WHICH EVERYONE
ENGAGED IN ONE FUNCTIONAL ACTIVITY, SUCH AS
ENGINEERING OR MARKETING, IS GROUPED INTO
• VULNERABLE TO EXPEDIENCY, MANIPULATION AND ONE UNIT.
OPPORTUNISM AND ITS LOW VISIBILITY MAKES IT 2. PRODUCT OR MARKET ORGANIZATION – THIS
DIFFICULT FOR MANAGEMENT TO DETECT THESE REFERS TO THE ORGANIZATION OF A COMPANY BY
PERVESIONS, AND CONSIDERABLE HARM CAN BE DONE DIVISIONS THAT BRINGS TOGETHER ALL THOSE
TO THE COMPANY. INVOLVED WITH A CERTAIN TYPE OF PRODUCT OR
CUSTOMER.
3. MATRIX ORGANIZATION - AN ORGANIZATIONAL
STRUCTURE IN WHICH EACH EMPLOYEE REPORTS
TO BOTH A FUNCTIONAL OR DIVISION MANAGER
AND TO A PROJECT OR GROUP MANAGER.

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ADVANTAGES OF DISADVANTAGES OF
FUNCTIONAL FUNCTIONAL
1.
ORGANIZATION ORGANIZATION
THE GROUPING OF EMPLOYEES WHO PERFORM A COMMON TASK PERMIT
ECONOMIES OF SCALE AND EFFICIENT RESOURCE USE.
1. COMMUNICATION AND COORDINATION BETWEEN THE DEPARTMENTS ARE
OFTEN POOR.
2. SINCE THE CHAIN OF COMMAND CONVERGES AT THE TOP OF THE
2. DECISIONS INVOLVING MORE THAN ONE DEPARTMENT PILE UP AT THE TOP
ORGANIZATION, DECISION-MAKING IS CENTRALIZED, PROVIDING A
MANAGEMENT LEVEL AND ARE OFTEN DELAYED.
UNIFIED DIRECTION FROM THE TOP.
3. COMMUNICATION AND COORDINATION AMONG EMPLOYEES WITHIN EACH
3. WORK SPECIALIZATION AND DIVISION OF LABOR, WHICH ARE STRESSED IN
A FUNCTIONAL ORGANIZATION, PRODUCE ROUTINE, NONMOTIVATING
DEPARTMENT ARE EXCELLENT.
EMPLOYEE TASKS.
4. THE STRUCTURE PROMOTES HIGH-QUALITY TECHNICAL PROBLEM-SOLVING
4. IT IS DIFFICULT TO IDENTIFY WHICH SECTION OR GROUP IS RESPONSIBLE
5. THE ORGANIZATION IS PROVIDED WITH IN DEPTH SKILL SPECIALIZATION FOR CERTAIN PROBLEMS.
AND DEVELOPMENT.
5. THERE IS LIMITED VIEW OF ORGANIZATIONAL GOALS BY EMPLOYERS.
6. EMPLOYEES ARE PROVIDED WITH CAREER PROGRESS WITHIN FUNCTIONAL
6. THERE IS LIMITED GENERAL MANAGEMENT TRAINING FOR EMPLOYEES.
DEPARTMENTS.

ADVANTAGES OF DISADVANTAGES OF
PRODUCT OR MARKET PRODUCT OR MARKET
ORGANIZATION ORGANIZATION
1. THE ORGANIZATION IS FLEXIBLE AND RESPONSIVE TO CHANGE. 1. THERE IS A HIGH POSSIBILITY OF DUPLICATION OF
2. THE ORGANIZATION PROVIDES A HIGH CONCERN FOR CUSTOMER’S RESOURCES ACROSS DIVISIONS.
NEEDS.
3. THE ORGANIZATION PROVIDES EXCELLENT COORDINATION 2. THERE IS LESS TECHNICAL DEPTH AND
ACROSS FUNCTIONAL DEPARTMENTS. SPECIALIZATION IN DIVISIONS.
4.
3. THERE IS POOR COORDINATION ACROSS DIVISIONS.
THERE IS EASY PINPOINTING OF RESPONSIBILITY FOR PRODUCT
PROBLEMS.
5. THERE IS EMPHASIS ON OVERALL PRODUCT AND DIVISION GOALS. 4. THERE IS LESS TOP MANAGEMENT CONTROL.
6.
5. THERE IS COMPETITION FOR CORPORATE RESOURCES.
THE OPPORTUNITY FOR THE DEVELOPMENT OF GENERAL
MANAGEMENT SKILLS IS PROVIDED.

ADVANTAGES OF MATRIX DISADVANTAGES OF

ORGANIZATION MATRIX ORGANIZATION
1. THERE IS MORE EFFICIENT USE OF RESOURCES THAN THE 1. THERE IS FRUSTRATION AND CONFUSION FROM DUAL CHAIN
DIVISIONAL STRUCTURE. OF COMMAND.
2. THERE IS FLEXIBILITY AND ADAPTABILITY TO CHANGING 2. THERE IS HIGH CONFLICT BETWEEN DIVISIONAL AND
ENVIRONMENT. FUNCTIONAL INTEREST.
3. THE DEVELOPMENT OF BOTH GENERAL AND FUNCTIONAL 3. THERE ARE MANY MEETINGS AND MORE DISCUSSION THAN
MANAGEMENT SKILLS ARE PRESENT. ACTION.
4. THERE IS INTERDISCIPLINARY COOPERATION AND ANY 4. THERE IS A NEED FOR HUMAN RELATIONS TRAINING FOR KEY
EXPERTISE IS AVAILABLE TO ALL DIVISIONS. EMPLOYEES AND MANAGERS.
5. THERE ARE ENLARGED TASKS FOR EMPLOYEES WHICH 5. THERE IS A TENDENCY FOR POWER DOMINANCE BY ONE SIDE
MOTIVATE THEM BETTER. OF THE MATRIX.

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STAFF OFFICERS MAY BE

TYPES OF AUTHORITY
CLASSIFIED INTO THE FF:
1. LINE AUTHORITY – A MANAGER’S RIGHT TO TELL
SUBORDINATES WHAT TO DO AND THEN SEE THAT THEY
DO IT.
1. PERSONAL STAFF – THOSE INDIVIDUALS ASSIGNED
TO A SPECIFIC MANAGER TO PROVIDE NEEDED STAFF
2. STAFF AUTHORITY – A STAFF SPECIALIST’S RIGHT TO SERVICES.
GIVE ADVICE TO A SUPERIOR.
3. FUNCTIONAL AUTHORITY – A SPECIALIST’S RIGHT TO
2. SPECIALIZED STAFF – THOSE INDIVIDUALS
PROVIDING NEEDED STAFF SERVICES FOR THE WHOLE
OVERSEE LOWER LEVEL PERSONNEL INVOLVED IN THAT
SPECIALTY, REGARDLESS OF WHERE THE PERSONNEL ARE ORGANIZATION.
IN THE ORGANIZATION.

COMMITTEE
• A FORMAL GROUP OF PERSON’S FORMED FOR A SPECIFIC
PURPOSE.
• COMMITTEE MAY BE CLASSIFIED AS:
1. AD HOC COMMITTEE – ONE CREATED FOR A SHORT-
TERM PURPOSE AND HAVE A LIMITED LIFE.
2. STANDING COMMITTEE – IT IS A RELATIVELY
PERMANENT COMMITTEE THAT DEALS WITH ISSUES
ON AN ONGOING BASIS.