Senior High School

Organization and Management

Quarter 1 – Module 6 – Lesson
1:
Planning Techn
Business De

Writer:
MALDRIN M. MESINA
T-II Remedios National High School, Lubao
Editors:
JANE P. VALENCIA, EdD – Math/ABM Supervisor
LUCIO B. GOMEZ- MT1-San Matias HS
CHAIRMAN
JONER G. MAGLALANG – MT- I LUCIO B.
GOMEZ – MT- I
 What I Need to Know

This module was designed and written with you in mind. It is here to help you
master Planning. The scope of this module permits it to be used in many different
learning situations. The language used recognizes the diverse vocabulary level of
students. The lessons are arranged to follow the standard sequence of the course.
But the order in which you read them can be changed to correspond with the
textbook you are now using.

The module consists of one lesson, namely:

Lesson 1 – Planning Techniques and Tools in Business Decision-making

After going through this module, you are expected to:

1. apply appropriate planning techniques and tools; and

2. formulate a decision from several alternatives.

What I Know

Let’s gauge the prior knowledge you have about the lesson. Are you ready?

This is a pre-assessment which will determine whether or not it’s still

necessary for you to take this module.

DIRECTION: Choose the letter of the best answer. Write the chosen letter on a
separate sheet of paper.

1. It indicates when the prepared alternative plan should be implemented.

a. Benchmark
b. Trigger point
c. Qualitative forecast
d. Quantitative forecast

2. This is where opinions of prominent economists are being used.

a. Benchmark
b. Trigger point
c. Qualitative forecast
d. Quantitative forecast

3. This is where mathematical calculations and statistical analyses of

surveys/researches are being used.
a. Benchmark
b. Trigger point
c. Qualitative forecast
d. Quantitative forecast

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4. It is another planning technique that generally involves external
comparisons of a company’s practices and technologies with those of other
companies.
a. Benchmarking
b. Contingency plans
c. Scenario planning
d. Participatory planning

5. They must be prepared by managers, ready for implementation when things

do not turn out as they should be.
a. Benchmarking
b. Contingency plans
c. Scenario planning
d. Participatory planning

6. It is affairs is a long-term version of contingency planning

a. Benchmarking
b. Contingency plans
c. Scenario planning
d. Participatory planning

7. It is a planning process that includes the people who will be affected by the
plans and those who will be asked to implement them in all planning steps.
a. Benchmarking
b. Contingency plans
c. Scenario planning
d. Participatory planning

8. It is a process which begins with problem identification and ends with the
evaluation of implemented solutions.
a. Decision making
b. Forecasting
c. Organizing
d. Planning

9. Most of the time decision-makers have to take decisions in a limited time

frame as instructed by the management.
a. Policies of organization
b. Timeliness
c. Value management
d. None of the above

10. It is applied to the resolution of problems that are new or unusual, and for
which information is complete.
a. Non-programmed decision
b. Planned decision
c. Non-programmed decision
d. Unplanned decision

11. It is a decision that is repetitive and can be handled using a routine

approach.
a. Non-programmed decision
b. Planned decision
c. Non-programmed decision
d. Unplanned decision

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 12. These are situations in which a manager can make precise decisions
because the results of all alternatives are known.
a. Certainty conditions
b. Risk managements
c. Uncertainty conditions
d. None of the above

13. These compel the decision maker to do estimates regarding the possible
occurrence of certain outcomes that may affect his or her chosen solution to
a problem.
a. Certainty conditions
b. Risk managements
c. Uncertainty conditions
d. None of the above

14. It requires the decision maker to list down possible alternatives that
could help resolve the identified problem.
a. Evaluate decision effectiveness
b. Develop alternatives
c. Identify the problem
d. Select alternative

15. The problem may be defined as a puzzling circumstance or a

discrepancy between an existing and a desired condition.
a. Evaluate decision effectiveness
b. Develop alternatives
c. Identify the problem
d. Select alternative

Lesson Planning Techniques and

2 Tools in Business Decision

making

This lesson gives a better understanding of planning techniques and tools and their
applications. It also discusses things about decision-making such as factors
affecting decision-making, types of decisions, types of decision-making conditions,
and the decision –making process.

What’s In

This is an activity that will let you explore and determine how broad your
understanding is about the given word.

DIRECTION: Complete the Web Diagram below. Think of terms that can be
associated with the word at the center. Write as many terms as possible.
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 Decision-
making

Do you agree that decision-making is an integral part of planning? Why or

why not?

___________________________________________________________________________

___________________________________________________________________________

___________________________________________________________________________

_______________________________________________________.

Notes to the Teacher

This module is designed for the students to fully acquire
the expected learning competencies. It includes series of activities
which are suggested to be accomplished for better understanding
and mastery of the lesson. The teacher should give proper
assistance when necessary.

5
 What’s New

Let’s practice our reading comprehension and critical thinking skills.

Below is an activity that will help you link the current lesson with the previous
one.

DIRECTION: Read and understand the case carefully and answer the given
questions below.

Ricardo Cortez and Josie Hernandez were partners in a footwear factory in

Marikina. They had 200 workers in the 1990s, who helped them manufacture
different designs of shoes, slippers, etc. which they displayed and sold by the
thousands in their store at the Cubao Expo. They were considered very successful
at that time.

Their footwear business slowed down when low-priced Chinese shoe imports
became popular in the Philippine market. Ricardo and Josie often quarreled about
money matters and management styles. Ricardo had more entrepreneurial
characteristics: creative/innovative, flexible, updated on new trends, and was
willing to take risks. Josie belonged to the “old school” of businessmen who could
not understand Ricardo’s propositions regarding the rehabilitation of their
business: getting business loans, introducing unique footwear designs, opening
“tiangge” stalls, online selling, etc. She was contented with the small profits they
were making.

Since their business is a partnership, Ricardo cannot carry out his plans without
Josie’s consent. Josie’s pessimism, for him, is unacceptable and he foresees the
closure of their business in a few more years if Josie will go on with her way of
thinking.

Questions:

1. List down three possible alternatives that could help Ricardo to resolve the
problem.
a. ____________________________________________________________________
b. ____________________________________________________________________
c. ____________________________________________________________________

2. Which among the three alternatives listed in number one is the best
solution? Explain your answer.
___________________________________________________________________________
___________________________________________________________________________
____________________________________________________________________.

6
 What is It

Did you enjoy the case and learn something from it? I bet you did!

Let’s get to know more about planning and decision-making. Since plans are done in
an environment of uncertainty, you will also begin to understand how assumptions
are formulated based on forecasts of expected future situations.

Planning Techniques and Tools and their Applications

• Forecasting
According to Schermerhorn (2008), forecasting is an attempt to predict what
may happen in the future. All planning types, without exception, may use of
forecasting. Forecasts used may be either quantitative or qualitative.
Opinions of prominent economists are used in qualitative forecasts while
mathematical calculations and statistical analyses of surveys/researches are
used in quantitative forecasts. These, however, are just aids to planning and
must be treated with caution. As the name implies, forecasts are predictions
and may be inaccurate, at times, due to errors of human judgment.
• Contingency Plans
Contingency factors may offer alternative courses of action when the
unexpected happens or when things go wrong. Contingency plans must be
prepared by managers, ready for implementation when things do not turn
out as they should be. Contingency factors called “trigger points” indicate
when the prepared alternative plan should be implemented.
• Scenario Planning
Planning for future states of affairs is a long-term version of contingency
planning and is also known as scenario planning. Several future states of
affairs must be identified and alternative plans must be prepared in order to
meet the changes or challenges in the future. This is a big help for
organizations because it allows them to plan ahead and make necessary
adjustments in their strategies and operations. Some examples of changes or
challenges that may arise in the future scenarios are environmental
pollution, human rights violations, climate and weather changes, earthquake
damages to communities, and others.
• Benchmarking
Benchmarking is another planning technique that generally involves external
comparisons of a company’s practices and technologies with those of other
companies. Its main purpose is to find out what other people or
organizations do well and then plan how to incorporate these practices into
the company’s operations. A common benchmarking technique is to search
for best practices used by other organizations that enabled them to achieve
superior performance. This is known as external benchmarking. Internal
benchmarking is also practiced by some organizations when they encourage
all their employees working in their different work units to learn and improve
by sharing one another’s best practices.
• Participatory Planning
Participatory planning is a planning process that includes the people who
will be affected by the plans and those who will be asked to implement them
in all planning steps. Creativity, increased acceptance and understanding of

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 plans, and commitment to the success of plans are the positive results of
this planning technique.

Decision-making
Decision-making is defined as the process by which different possible
solutions or alternatives are identified and the most feasible solution or course of
action is finalized. It is an integral part of planning.

Factors Affecting Decision-Making

1. Timelines
The quality of decisions depends on how much time has been devoted to making
decisions. Most of the time decision-makers have to take decisions in a limited time
frame as instructed by the management. Due to the time limit, decision-makers are
not able to collect all the necessary information that influences decisions and are,
also, not able to look for more alternatives.
2. Value and beliefs of decision-makers
In addition, the quality of decisions also depends upon the value and belief system
of the decision-makers. Anyone’s reaction to a particular situation is more likely to
depend on the individual’s values, likes and dislikes, thoughts, and beliefs. It is
also a behavioural aspect of the decision-makers and reflects in their decisions
related to goals, strategy-making activities. So, value-based decisions help in
prioritizing tasks and making goals, identifying different solutions to problems, and
finalizing the best solution or alternative.
3. Policies of organization
Decisions are affected by the policies of an organization. Decisions taken have to be
in the boundary or within the limits of these policies. Decisions which violate
policies are not considered for implementation. Though there is a scope to make
changes in policies as per decision, most of the time decisions should be at par
with the policy guidelines. However, a change in policy is a time-consuming task
and requires lots of things to be considered before any change. Comparatively, a
change in proposed decisions is much easier.
4. Other factors like budget, manpower, values of management also
influence decision-making.

Types of Decisions

• Structured or Programmed Decision

It is a decision that is repetitive and can be handled using a routine
approach. Such repetitive decision applies to resolving structured problems
which are straightforward, familiar, and easily defined. For example, a
restaurant customer complains about the dirty utensils the waiter has given
him. This is not an unusual situation, and, therefore, standardized solutions
to such a problem may be readily available.
• Unstructured or Non-programmed Decision
It is applied to the resolution of problems that are new or unusual, and for
which information is complete. Such non-programmed decisions are
described to be unique, nonrecurring and need custom-made decisions. For
example, a hotel manager is asked to make a decision regarding the building
of a new hotel branch in another city to meet the demands of businessmen
there. This is an unstructured problem and, therefore, need unstructured or
non-programmed decisions to resolve it.

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Types of Decision-making Conditions

• Certainty Conditions
These are ideal conditions in deciding problems; these are situations in
which a manager can make precise decisions because the results of all
alternatives are known. For example, bank interests are made known to
clients so it is easier for business managers to decide on the problem of
where to deposit their company’s funds. The bank which offers the highest
interest rate, therefore, is the obvious choice of the manager when asked to
make a decision.
• Risk or Uncertainty Conditions
These are more common condition in deciding problems. Risk or uncertainty
conditions compel the decision maker to do estimates regarding the possible
occurrence of certain outcomes that may affect his or her chosen solution to
a problem. Historical data from his or her own experiences and other
secondary information may be used as bases for decisions to be made by the
decision maker under such risk conditions. For example, a manager is asked
to invest some of their company funds in the money market offered by a
financial institution. Risk factors must be considered, because of the
uncertainty conditions involved, before making a decision – whether to invest
or not in the said money market.

The Decision-making Process according to Robbins and Coulter

Step 1: Identify the Problem. The problem may be defined as a puzzling

circumstance or a discrepancy between an existing and a desired condition. Step
2: Identify the Decision Criteria. These are important or relevant to resolving
the identified problem.
Step 3: Allocate Weights to the Criteria. This is done in order to give the
decision maker the correct priority in making the decision.
Step 4: Develop Alternatives. This step requires the decision maker to list down
possible alternatives that could help resolve the identified problem.
Step 5: Analyze the Alternatives. Alternatives must be carefully evaluated by the
decision maker using the criteria identified in Step 2.
Step 6: Select an Alternative. This is the process of choosing the best alternative
or the one which has the highest total points in Step 5.
Step 7: Implement the Chosen Alternative. This step puts the decision into
action. Changes in the environment must be observed and assessed, especially in
cases of long-term decisions, to see if the chosen alternative is still the best one.
Step 8: Evaluate Decision Effectiveness. This is the last step and involves the
evaluation of the outcome of the result of the decision to see if the problem was
resolved. If the problem still exists, the manager has to assess what went wrong
and, if needed, repeat a step or the whole process.

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 What’s More

Activity 1.
1. Give at least five business forecasts that may occur in the Philippines three
years from now. Use either qualitative or quantitative forecasting.
a. ____________________________________________________________________
b. ____________________________________________________________________
c. ____________________________________________________________________
d. ____________________________________________________________________
e. ____________________________________________________________________

2. How can planning through benchmarking be useful for the owner of the
startup business?
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_______________________________________________________________

Activity 2.
Give your own three examples of decision-making under risk and certainty
conditions.

CERTAINTY CONDITIONS
1.

2.

3.

RISK OR UNCERTAINTY CONDITIONS

1.

2.

3.

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 What I have Learned

I bet you discovered a lot about the planning techniques and tools in business
decision-making. However, are you confident that you have learned enough? Let’s
find out!

1. Effective planning in dynamic environments, different techniques and tools

must be used, such as ____________________________________________________
____________________________________________________________.

2. ___________________________________________________________________________
___ ___________________________ are the positive results of this planning
technique.

3. ________________________________________________ in organizations make

decisions or make choices that affect their jobs and the organization they
work for.

4. Due to ___________________________, decision-makers are not able to collect

all the necessary information that influences decisions and are, also, not
able to look for more alternatives.

5. Anyone’s reaction to a particular situation is more likely to depend on the

__________________________________________________________.

6. Decisions taken have to be ________________________________________________

_______________________________________.

7. Other factors like ____________________________________________ also

influence decision-making.

8. ____________________________ are situations in which a manager can make

precise decisions because the results of all alternatives are known.

9. Risk factors must be considered, because _________________________________

___________________________________________________________________________
___ ________________________________________________.

10. Evaluating decision effectiveness involves _________________________________

____________________________________________________________.

What I Can Do

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 1. Choose one company in your local area. Identify one problem that you think
they have. Solve your identified problem by going through the eight steps of
decision making process.

COMPANY NAME:
PROBLEM:
Step 1

Step 2

Step 3

Step 4

Step 5

Step 6

Step 7

Step 8

2. Which among the Planning Techniques and Tools do you think is the best
one to use in order to address and solve the problem that you have identified
in number one? Support your idea.
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___ _______________________________________________________________

Assessment

Great job! You are now ready for an Assessment! We will now see how well you
understood the lesson.
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Please answer on a separate sheet of paper.

CORRECT THE SENTENCES: Identify the word that makes the sentence incorrect
and write down the correct one.

1. Opinions of prominent economists are used in quantitative forecasts while

mathematical calculations and statistical analyses of surveys/researches are
used in quantitative forecasts.

2. Benchmarking’s main purpose is to find out what other people or

organizations do well and then plan how to incorporate these practices into
the company’s operations.

3. Anyone’s reaction to a particular situation is more likely to depend on the

individual’s appearance, likes and dislikes, thoughts, and beliefs.

4. Non-programmed decisions are described to be unique, recurring and need

custom-made decisions.

5. Changes in the environment must be observed and assessed, especially in

cases of short-term decisions, to see if the chosen alternative is still the best
one.

COMPLETE THE SENTENCES: Choose the correct word or phrase from the box to
complete each sentence.

IMPLEMENTATION INTERNAL BENCHMARKING

ENVIRONMENT FORECASTS

VALUE AND BELIEF SYSTEM ALTERNATIVE COURSES OF ACTION

RISK FACTORS LIMITED TIME FRAME

VALUE-BASED DECISIONS IDEAL CONDITIONS

1. ______________ are predictions and may be inaccurate, at times, due to errors

of human judgment.

2. Contingency factors may offer ___________________________ when the

unexpected happens or when things go wrong.

3. _______________________ is also practiced by some organizations when they

encourage all their employees working in their different work units to learn
and improve by sharing one another’s best practices.

4. Most of the time decision-makers have to take decisions in a

_________________ as instructed by the management.

5. The quality of decisions also depends upon the ___________________ of the

decision-makers.
13
 6. __________________ help in prioritizing tasks and making goals, identifying
different solutions to problems, and finalizing the best solution or
alternative.

7. Decisions which violate policies are not considered for__________________.

8. Certainty conditions are __________________ in deciding problems.

9. _________________ must be considered, because of the uncertainty conditions

involved, before making a decision.

10. Changes in the _________________ must be observed and assessed, especially

in cases of long-term decisions, to see if the chosen alternative is still the
best one.

Additional Activities

Answer the following questions or situations based on what you’ve learned from the
lesson.

1. Which is a better planning tool: forecasting or benchmarking? Why?

___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
__________________________________________________________________

2. Name some examples of changes or challenges, other than those mentioned

in this lesson that may occur in future scenarios.
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
__________________________________________________________________

3. Which among the steps in the decision-making process (according to

Robbins and Coulter) is the most important? Explain your answer.
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
__________________________________________________________________

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 4. Is it really easier to make a structured or programmed decision? Why or why
not?
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
__________________________________________________________________

5. Do you agree with the statement that risk conditions in decision-making are
more common? Explain your answer?
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___ __________________________________________________________________

Criteria for Activities

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 Areas of 4 3 2 1
Assessment
Ideas Presents ideas in Presents ideas in Ideas are too Ideas are vague
an original a consistent general or unclear
manner manner
Organization Strong and Organized Some No
organized beg/mid/end organization; organization;
beg/mid/end attempt at a lack
beg/mid/end beg/mid/end
Understanding Writing shows Writing shows a Writing shows Writing shows
strong clear adequate little
understanding understanding understanding understanding
Word Choice Sophisticated use Nouns and verbs Needs more Little or no use
of nouns and make essay nouns and verbs of nouns and
verbs make the informative verbs
essay very
informative
Sentence Sentence Sentence Sentence No sense of
Structure structure structure is structure is sentence
enhances evident; limited; structure or
meaning; flows sentences mostly sentences need flow
throughout the flow to flow
piece
Mechanics Few (if any) errors Few errors Several errors Numerous
errors

References

Helena Ma. F. Cabrera, PhD, Anthony DC Altajeros, PhD, Riaz Benjamin (Authors)
Clarence Darro B. Del Castillo (Editor)

16
Organization and Management – 2016

https://studiousguy.com/planning-decision-making/

For inquiries or feedback, please write or call:

Department of Education - Bureau of Learning Resources (DepEd-BLR)

Ground Floor, Bonifacio Bldg., DepEd Complex

Meralco Avenue, Pasig City, Philippines 1600

Telefax: (632) 8634-1072; 8634-1054; 8631-4985

Email Address: blr.lrqad@deped.gov.ph * blr.lrpd@deped.gov.p

17
 Answer Key
What I Know
1. Trigger Point
2. Qualitative Forecast
3. Quantitative Forecast
4. Benchmarking
5. Contingency plans
6. Scenario planning
7. Participative planning
8. Decision-Making
9. Timeliness
10. Unstructured/Non-
programmed Decision
11. Structured/Programmed
Decision
12. Certainty Conditions
13. Risk/Uncertainty Conditions
14. Develop attentiveness
15. Identify the Problem
Assessment
Correct the Sentences
1. Quantitative-
2. Forecasting - Benchmarking
3. Appearance - Values
4. Recruiting – Non-recruiting
5. Short Term Decisions – Long
Term Decisions
Complete the Sentences
1. Forecasts
2. Alternative courses of action
3. Internal Benchmarking
4. Limited time frame
5. Value and Belief system
6. Value-based decisions
7. Implementation
8. Ideal Conditions
9. Risk Factors
10. Environment