Planning

PLANNING

Determining the future course of action

Definition

Process Forward looking Pervasive-at all levels

Features

Long term vs Short term

Objectives Planning premises Alternatives Evaluating alternatives Choice of alternatives Supporting plans Establishing sequence of activities

Steps in planning

Commitment to a particular course of action believed necessary to achieve specific results

Plan

Standing - policies, rules, objectives Single use – budget, targets

Types of plans

Long term vision of what organisation seeks to do and why does it exist.

Focus is external

Mission

End results towards which activities are aimed

Good objectives should have SMART features:S- specificM-measurableA- achievableR-realisticT-time bound

Management by Objectives (MBO)

Objectives/goals

Strategies are complex plans for bringing organisations from one position to other in future period (determined in light of external environment)

Policies are general statements which provide guidance in decision making

Strategies/Policies

-Series of related tasks-Establish a method for handling activities

Policies provide direction, procedure tell how to do

Procedures

Based on facts Stability Flexibility Minimum in number

Procedure

Prescribed guidelines for conduct, action.

Rules

Planned actions integrated into unity, designed to bring about stated objective

Projects/ programmes

Corporate - top management Tactical - middle management Operational – lower management

Levels of planning

List your five most important personal objectives? Are they long term or short term?

Are the objectives verifiable?

Exercise

Qualitative Methods of ForecastingMethod Advantages Disadvantages

Estimation

People in position estimate the number of people the firm will require in the next yr.

Incorporates knowledge of corporate plans in making estimates

May be subjective

Expert opinion

Panel of experts forecast HR requirements for particular future business scenarios. For this method, there may be a single expert, or estimates of several experts may be pooled together

Delphi Experts go through several rounds of estimates with no face-to-face meeting

Incorporates future plans & knowledge of experts related to mkt., industry & technical development

Subjective, time consuming & may ignore data

Group brainstorming

Face-to-face discussion based on multiple assumptions about future business direction

Generates lot of ideas Does not lead to conclusion

Nominal group technique

Face-to-face discussion Group exchanges facilitate plans

Subjective which may ignore data

Simple averaging

Simple averaging of viewpoints

Diverse view points taken

Extremes views are masked when averaged

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Quantitative Methods of Forecasting

Method Advantages Disadvantages

Trend analysis & projection

Based on past relationship between a business factor related to employment & employment level itself

Simple long-run trend analysis

Extrapolates past relationship between volume of business activity & employment levels into the future

Recognizes linkage between employment & business activity

Assumes that volume of business activity of firm for forecast period will continue at same rate as previous yrsIgnores multiplicity of factors influencing employment levels

Regression analysis

Regresses employment needs onto key variables

Data drivenUses multiple business factors

Difficult to use & apply

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Types of decisions

A decision is an act of choice by which an individual or organisation selects one position or action from several alternatives

Decision Making

Strategic decisions Tactical decisions

Types

Specific objectives Identification of problems: diagnosis,

analysis Search for alternatives Evaluation of alternatives Choice Action Results

Process

Certainty-using deterministic model

Risk (information insufficient) ◦ -Priori probability (tossing coin)◦ -Empirical probability◦ -Subjective probability

Decision making conditions

Uncertainty◦ -maximax criterion◦ -maximin criterion◦ -Minimax criterion (minimising regret)◦ -Insufficient reason criterion 9equal probability is

assigned to each event)

Decision making conditions

Operations Research Decision Tree Game Theory Queuing Theory

Quantitative methods of decision making