Planning is the action you take today to prepare for tomorrow. It is a roadmap to where you intend to go. There may of course be detours, slow-downs, or problems along the way, but generally planning defines the direction you intend to go.
According to Lorange (1993), when doing planning managers need to: a) write or review the organization’s mission, b) identify and analyze opportunities, c) establish goals, d) select a course of action to achieve these goals, d) determine resources needed.
The Mission Statement for the organization is a general overall goal the company strives toward. It should be written and communicated to all share-holders. Management expert Peter Drucker suggests that companies should ask and re-ask themselves two questions related to their mission–What is our business, and what should it be? The text suggests a number of rules for writing and implementing mission statements. The rules should invite input while helping focus the company on its vital interests.
Plans are characterized by goals, or markers of performance. Goals should be:
a) specific and measurable,
b) realistic and challenging,
c) focused on key result areas,
d) cover a specific time period,
e) reward performance.
Goals taking less than a year to achieve are usually referred to as short-term goals, those taking longer than this are called long-term goals.
“Tactics” are the courses of action associated with reaching short-term goals. “Strategies” are the actions taken to achieve long-term goals or objectives. Of course, resources must also be identified that will be needed for the reaching of these goals. Strategic, tactical and operational plans will be needed to achieve the associated objectives. Operational plans are the day-to-day actions that support tactical goals.. Policies and procedures are the ongoing or standing plans that are used to address recurring activities. A rule is a very specific guide to behavior.
It has been said that planning is more important than plans; meaning that the process of planning and the ability prepare for and adapt to changing futures is more important than the specific plans of the moment. Planning requires a systematic approach. The relevant goals should be selected, alternatives identified and evaluated, best solutions selected, plans implemented, and evaluation done of the outcomes.
A number of forecasting and planning tools are available to assist in planning. Good planning is dependent on any number of factors including good information and assessment. It is dangerous to make decisions without adequate information, without the buy-in of important support groups, or without duly considering the “what-if” scenarios of external factors beyond the managers control. On the other hand, some decisions must necessarily be made with only partial or peripheral information available.
“Management by Objectives” is a concept that suggests that planning and resource allocation should be based primarily on the identified supportable goals of the organization, rather than the political and other capricious influences that may take control of a company’s decision making.
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