University of Lagos

Faculty of Management Sciences

Department of Business Administration
B.Sc. Business Administration

Course: BUS 120 – Introduction to Management

Topics: 1) Foundation of Planning
2) Foundation of Control
Lecturer Notes
By
Simeon E. Ifere, Ph.D., FNIM
Thursday, 9th May 2024
 PLANNING

Planning is selecting missions and objectives as

well as actions to achieve them, which requires
decision making. (Weihrich, Cannice & Koontz,
2008).

• Decision making is the process of making

choices from among several options.

• Mission is the reason or purpose for an

organisation’s existence. It defines the need to
fulfill in society.
 PLANNING

• Objectives are the aim of action or desired

targets with regard to particular time-frame.

- Note that objectives create focus for an

organization and its staff and help to measure
the level of organization’s or staff’s success or
performance.

- Objectives should be SMART

 PLANNING

Forecasting is a key element in the planning

process and precedes planning. It forms the
foundation or basis or background for planning.

The outcome of forecasting is a forecast, which

is an estimated value of what is achievable and
determines the objective.

See illustration in the next slide

 PLANNING
Planning process (rational)
Long term monitoring & Control
Analyze the of the environment

Options Choice/ Implementation

Mission and objective Options
selection
evaluation

Analysis of resources
Long term monitoring & Control

Source: Adapted from Lynch (2012)

 MANAGEMENT PROCESS

Types of Planning / Plans

1a. Strategic planning

Is a formal planning system for developing and implementing
the strategies related to the mission and objectives (long-term?)
of an organization. It takes into consideration the organisation’s
resources and capabilities as well as the environment of the
business.

1b. Strategic plan / Strategy content

• Results from a formal planning system for developing and
implementing the strategies related to the mission and
objectives of an organization.
• Defines the process or roadmap for implementing strategy
 MANAGEMENT PROCESS

2a. Operational planning

The process of making detailed short-term plan to implement
strategic plan on day-to-day basis.

2b. Operational plan

Indicates what to do, who will do it and how to do it, within a
normal time horizon of one year or less.
 MANAGEMENT PROCESS

Differences between Strategic plan and

Operational Plan
• Details – Operational plans are specific and detailed while
strategic plans are generic and less detailed
• Scope – Operational plan is narrow; to achieve a specific end
or revolving around one department of an organization while
a strategic plan covers the entire organization.
• Time – Operational plan time frame is usually a year or less
while strategic plan covers many years.
However, both operational plans and strategic plans are
important as they provide organizations with short term and
long term guide to its destination
 PLANNING

Why is planning important

• Planning provides a rational, systematic
or guided approach to achieving
objectives.

• It helps to bridge the gap from present

position to a desired position and
provides basis for control.
 CONTROLLING

Controlling involves monitoring of plan

implementation and evaluation in order to deal
with deviations and maintain the direction that
would lead to achievement of the organization’s
objectives

• Objectives form the basis for controlling.

 CONTROLLING

• The process of control begins with setting

objectives/standards, followed by
performance and measurement of
performance, then correction is carried out, if
necessary, to ensure conformance to plans
and achievement of objectives
 CONTROLLING

1. Standards are criteria for performance,

indicating points in the plan at which
measurement is carried out.

• Examples of standards are, objectives

(production output, sales volume, profit, etc.);
budgets (cost and revenue); policies and
procedures.
 CONTROLLING

2. Measurement of performance involves

assessing or measuring the performance against
established plan or standards (note signals of
deviation), by carrying out periodic performance
appraisal of organization, groups and individual.
 CONTROLLING

2. Correction encompasses correcting

deviations from plan/standard.

This may training and performance based

incentives/rewards (positive and negative).
 CONTROLLING
Controlling Techniques
1. Feedback
This is the mechanism for receiving information
on performance from the system. The
information is analysed to identify deviation (if
any) from Standard, then corrective measures
are taken.
Feedback may emanate from customers or
internal assessment of output by quality control
unit. With technological advancement, real time
feedback is now available for prompt control.
 CONTROLLING

2. Concurrent
Control undertaken while activity is on-going to
ensure that the outcome conforms to standard.
3. Feedforward
System input is monitored and required
correction effected to prevent negative impact
on output – discuss examples
.
 PLANNING

Control Loop