Concepts of Planning & Control

Concept of Organizational Planning

Organizational planning helps business owners organize day-to-day operations efficiently.
It covers both simple aspects like the company's reason for existence and complex aspects like setting specific goals.
Used as a framework to create and assign tasks within the organization.
Helps in improving overall business performance by setting clear objectives.
Includes various goals:
- Workforce Development: Planning for employee training and development. For example, XYZ Company sets up regular workshops and training sessions to enhance employee skills.
- Financial Planning: Budgeting and forecasting financial resources. For example, XYZ Company's leader creates a budget plan for the next fiscal year to ensure financial stability.
- Expansion Planning: Developing new products and services. For example, XYZ Company plans the launch of a new product line to enter a new market segment.

Types of Organizational Planning

Organizational planning is divided into four main phases: strategic, tactical, operational, and contingency.
Each phase builds upon the previous one, with strategic planning being the most important.

Phases of Organizational Planning

Strategic Planning:
- Strategic planning involves setting long-term goals and defining the overall direction for the company.
- These goals align with the company's mission, vision, and values.
- This phase typically involves top managers and sometimes includes input from employees.
- Example: XYZ Company aims to become the top provider in its industry within the next five years by expanding its product range and enhancing customer service.
Tactical Planning:
- Tactical planning focuses on creating specific short-term actions to achieve the strategic goals.
- These plans usually span a year or less and are carried out by middle management.
- Example: To support its strategic goal, XYZ Company plans a six-month marketing campaign to increase brand recognition and attract new customers.
Operational Planning:
- Operational planning deals with the day-to-day activities required to implement the tactical plans.
- This involves setting up work schedules, policies, and procedures for employees.
- Specific tasks are assigned and protocols for tracking progress are established.
- Example: XYZ Company’s operational team develops a detailed plan for the marketing staff, outlining daily tasks and deadlines to ensure the campaign runs smoothly.
Contingency Planning:
- Contingency planning involves preparing backup plans for unexpected events that could disrupt the original plans.
- This includes identifying potential risks and developing responses for those risks.
- Possible scenarios include natural disasters, technology failures, or key personnel leaving the company.
- Example: XYZ Company creates a contingency plan that includes shifting their marketing strategy to online platforms if their physical events are canceled due to unforeseen circumstances.

The Planning Process

The planning process is essential for the success of any organization, involving systematic steps to achieve strategic goals. It starts with developing a strategic plan and translates into daily operations, ensuring that every level of the organization is aligned and working towards the same objectives. Below are the key phases of the planning process:

Phases of the Planning Process

Develop the Strategic Plan
- Review your company's mission, vision, and values.
- Gather data about your company's performance, such as sales metrics.
- Conduct a SWOT analysis to assess strengths, weaknesses, opportunities, and threats.
- Set clear and achievable goals based on the analysis.
- Example: XYZ Company reviews its mission and vision, analyzes sales data, conducts a SWOT analysis, and sets a goal to increase market share by 20% in the next two years.
Translate the Strategic Plan into Tactical Steps
- Define short-term goals, often quarterly objectives.
- Establish processes for monitoring and evaluating goal achievement.
- Develop contingency plans, such as responses to potential data breaches.
- Example: Middle managers break down this goal into quarterly targets, establish monitoring processes, and develop contingency plans for potential disruptions.
Plan Daily Operations
- Set specific goals and targets for individual employees or teams.
- Create work schedules and assign tasks to achieve operational goals.
- Example: The operational team creates work schedules and assigns tasks to achieve the quarterly targets set by the tactical plan.
Execute the Plans
- Implement the plans in day-to-day activities.
- Ensure that operational activities contribute to meeting tactical goals, which in turn support the overall strategic plan.
- Example: The company implements the plans, ensuring that daily operations contribute to reaching quarterly targets and ultimately the strategic goal.
Monitor Progress and Adjust Plans
- Regularly review progress against set benchmarks, usually at the end of each quarter or short-term goal period.
- Submit data-backed reports to executives for evaluation.
- Adjust strategic, tactical, or operational plans based on performance reviews and feedback.
- Example: At the end of each quarter, managers review progress, submit reports to executives, and make adjustments to plans based on performance data and feedback.

Characteristics of Control Process

Key Characteristics

Managerial Process:
- Control is one of the five key functions of management, along with planning, organizing, staffing, and directing.
- It is an integral part of the management process, ensuring that goals are achieved effectively and efficiently.
Forward Looking:
- Control focuses on future operations and takes corrective action based on past performance to improve future outcomes.
- It uses past data to guide decisions and corrections for future activities.
Exists at Each Level of Organization:
- Control is practiced by managers at all levels, from top executives to frontline supervisors.
- Each level of management focuses on different aspects of control, such as strategic control at the top level and operational control at lower levels.
Continuous Process:
- Control is not a one-time activity but an ongoing process that requires constant analysis and adjustment.
- It involves setting standards, monitoring performance, and making continuous improvements.
Linked with Planning:
- Planning and control are interconnected, with planning setting the goals and control ensuring that activities stay on track to achieve those goals.
- Actual performance is compared against planned standards, and control measures are adjusted accordingly.
Goal Oriented and Positive Purpose:
- Control has a positive purpose for both the organization and individuals, aiming to achieve organizational goals while ensuring accountability and performance improvement.
- It motivates individuals to contribute towards organizational objectives and fosters a culture of continuous improvement.

Consider XYZ Company's control process:

The management team at XYZ Company uses control as part of their managerial process, ensuring that goals are met efficiently.
They focus on future outcomes by analyzing past performance data and making corrections to improve future operations.
At every level of the organization, from top executives to frontline supervisors, control measures are implemented to monitor and improve performance.
Control is not a one-time activity but a continuous process, with standards regularly reviewed and adjusted based on external factors and internal performance.
It is closely linked with planning, where goals and standards set during planning are monitored and adjusted during the control process.
The purpose of controlling at XYZ Company is goal-oriented and positive, aiming to achieve organizational objectives while motivating individuals to contribute effectively.

The Nature of Control in an Organization

Control is a critical function within an organization, ensuring that activities are aligned with the planned objectives and goals. It involves monitoring performance, making necessary adjustments, and guiding the organization towards achieving its desired outcomes. Effective control helps managers oversee operations, make informed decisions, and maintain organizational efficiency. Below are the key characteristics of control that highlight its importance and application in organizational management:

Function of Management:
- Control is a managerial function performed by managers to oversee and manage activities within the organization.
Based on Planning:
- Control evaluates actual performance against predetermined standards set during the planning process.
- Planning defines goals, while control ensures actions align with the plan to achieve those goals.
Dynamic Process:
- Control is dynamic, involving continuous supervision and corrective actions based on feedback and changing circumstances.
- It may lead to adjustments in the plan to improve future performance.
Information-Guided:
- Effective control relies on accurate and timely information about actual performance.
- A robust reporting system is essential for sound control, requiring ongoing monitoring and review of operations.
Essence of Action:
- Control is realized through corrective actions based on feedback, adjusting performance to meet predetermined standards.
- Action is the key component that aligns performance with desired outcomes.
Delegation and Responsibility:
- Effective control requires delegation of authority to take corrective actions.
- Delegation of control is crucial as it ensures accountability and responsibility for achieving goals.
Future-Oriented:
- Control focuses on improving future performance by comparing actual results with standards and taking corrective measures.
- It aims to enhance performance and achieve organizational goals.
Universal Function of Management:
- Control is a fundamental function of management performed by every manager to monitor progress, identify deficiencies, and take corrective actions.
Positive and Goal-Oriented:
- Controlling is a positive function aimed at making things happen and achieving goals effectively, rather than being negative or restrictive.
- It ensures that planned activities are carried out efficiently and constraints are addressed constructively.

Consider XYZ Company's approach to control:

Managers at XYZ Company use control as a function to oversee and manage activities effectively.
They base control on the goals set during planning, ensuring actions align with these goals.
Control is dynamic, involving continuous supervision and adjustments based on feedback and changing circumstances.
Information plays a crucial role in guiding control actions, with accurate data and reporting systems in place.
Control is action-oriented, with corrective actions taken to align performance with standards and achieve desired outcomes.
Delegation of authority and responsibility is essential for effective control, ensuring accountability and goal achievement.
Control is future-oriented, focusing on improving future performance and achieving organizational goals.
It is a universal function performed by all managers to monitor progress, identify deficiencies, and drive performance improvements.
Controlling is a positive and goal-oriented function, aimed at achieving results efficiently and effectively.

Information System Planning

Information System Planning is a crucial aspect of organizational strategy, ensuring that technology aligns with business objectives and operational needs. It involves strategic decisions about how information systems can support and enhance business processes to achieve competitive advantage and organizational goals. Below are the key dimensions that characterize Information System Planning:

Business Strategy: Organizational leaders define future goals and missions to guide business strategy.
Information Systems Mission: Clear business goals lead to determining the level of automation required in various processes.
Information Systems Components: Details of hardware, software, dependencies, and timelines for the target information system are defined. A systems analyst helps in deducing all components and requirements.
Information Systems Initiatives and Budget: After defining technological components, initiative plans are outlined to guide the company. Budget allocations for each module and funding requirements are considered at this stage.

Consider XYZ Company's information system planning process:

The company's directors set clear goals and missions for future achievements, guiding business strategy.
Based on these goals, the level of automation needed in various processes is determined.
Components of the target information system, including hardware, software, dependencies, and timelines, are meticulously defined with the assistance of a systems analyst.
Initiative plans are then developed to implement technological components, with budget allocations and funding needs carefully considered.

Information System Development

Information system development involves a structured approach to managing software projects, ensuring that they meet business goals and user requirements. The systems-development life cycle (SDLC) is a methodology used to guide this process through various stages:

Systems-Development Life Cycle (SDLC)

The SDLC consists of several key phases:

Investigation: Assessing business opportunities and priorities to identify solutions using information technologies. Conducting feasibility studies to evaluate proposed solutions.
Preliminary Analysis: Reviewing system requests and conducting feasibility studies covering technical, economic, and legal aspects.
System Analysis: Working with stakeholders to define system requirements, document procedures, and gather data. Creating a system requirements document.
System Design: Developing technical details based on system requirements. Translating business requirements into technical specifications for the user interface, database, inputs/outputs, and reporting.
Programming: Writing code based on the system design document to create the software.
Testing: Conducting unit, system, and user acceptance tests to ensure software functionality and quality. Resolving bugs and errors found during testing.
Implementation: Deploying the new system, providing training and documentation, and converting data from the old system.
Maintenance: Supporting the system with bug fixes, updates, backups, and evaluating new feature requests.

Consider XYZ Company's information system development:

XYZ follows the systems-development life cycle (SDLC) to manage large software projects.
They begin with investigating business opportunities and conducting feasibility studies.
Through analysis and design, they define system requirements and technical specifications.
Programmers then develop the software, followed by rigorous testing to ensure functionality and quality.
After successful testing, the system is implemented, and ongoing maintenance ensures continuous support and improvement.