Chapter 5 Definitions

Business Management 300 with Yankey at James Madison University

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By: Phil Crain
Created: 2011-11-01
Size: 40 flashcards
Views: 2

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The four functions of Management

Planning
Organizing
Leading
Controlling

Planning

-Setting goals and deciding how to achieve them.

-Coping with unc

Types of Planning

Strategic Planning - done by top level managers and CEOs

Tactical Planning - done by mid level managers

Operational Planning - done by first line managers

Planning and Strategic Management Process

Establish the organization's mission and vision
Formulate the grand strategy
Formulate the strategic plans, then the tactical and operational plans
Implement the strategic plans
Control the strategy

Two cautions to planning

Planning requires you to set aside the time to do it
You may have to make some decisions without a lot of time to plan

Four benefits of planning

Planning helps you check on your progress
Planning helps you coordinate activities
Planning helps you think ahead
Planning helps you cope with uncertainty

The four responses to uncertainty

Defenders
Prospectors
Analyzers
Reactors

Defenders

Expert at producing and selling narrowly defined products or services.

"Let's stick with what we do best, and avoid other involvements."

Prospectors

Focus on developing new products or services and in seeking out new markets, rather than waiting for things to happen.

"Let's create our own opportunities, not wait for them to happen."

Analyzers

Let other organizations take the risks of product development and marketing and then imitate/and improve on what seems to work best.

"Let others take the risks of innovating, and we'll imitate what works best."

Reactors

Make adjustments only when finally forced to by environmental pressures.

"Let's wait until there's a crisis, then we'll react."

Adaptive Cycle

Portrays businesses as continuously cycling through decisions about three kinds of business problems:

Entrepreneurial
Engineering
Administrative

Mission to Objectives

Mission Statement: What is our reason for being?
Vision Statement: What do we want to become?
Strategic Planning: Done by top managers for the next 1-5 years.
Tactical Planning: Done by middle managers for the next 6-24 months
Operational Planning: Done by first line managers for the next 1-52 weeks.

Mission

An organization's purpose or reason for being.

Mission Statement

Expresses the purpose of the organization.

Vision

A long-term goal describing what an organization wants to become. It is a clear sense of the future and the actions needed to get there.

Vision Statement

Expresses what the organization should become, where it wants to go strategically.

Strategic Planning

Strategic planning by top management. They determine what the organization's long term goals should be for the next 1-5 years with the resources they expect to have available.

Tactical Planning

Tactical planning by middle management. They determine what contributions their departments or similar work units can make with their given resources during the next 6-24 months.

Operational Planning

Operational Planning by first-line management. They determine how to accomplish specific tasks with available resources within the next 1-52 weeks.

Goal or Objective

A specific commitment to achieve a measurable result within a stated period of time.

Means-End Chain

In the chain of management, the accomplishment of low-level goals is the means leading to the accomplishment of high-level goals.

Strategic Goals

Set by and for top management and focus on objectives for the organization as a whole.

Tactical Goals

Set by and for middle managers and focus on the actions needed to achieve strategic goals.

Operational Goals

Set by and for first-line managers and are concerned with short-term matters associated with realizing tactical goals.

SMART Goal

A goal that is Specific, Measurable, Attainable, Relevant, and Timely.

Action Plan

Defines the course of action needed to achieve the stated goal.

Operating Plan

Typically designed for a 1-year period, it defines how you will conduct your business based on the action plan; it identifies clear targets such as revenues, cash flows, and market share.

Standing Plan

Plans developed for activities that occur repeatedly over a period of time.

Consist of Policies, Procedures, and Rules.

Policy

A standing plan that outlines the general response to a designated problem or situation.

Procedure or Standard Operating Procedure

A standing plan that outlines the response to particular problems or circumstances.

Rule

A standing plan that designates specific required action.

Single-Use Plans

Plans developed for activities that are not likely to be repeated in the future.

Made up of Programs and Projects.

Program

A single-use plan encompassing a range of projects or activities.

Project

A single-use plan of less scope and complexity than a program.

Management by Objectives (MBO)

A four step process that seeks to motivate rather that control employees.

Managers and employees jointly set objectives for the employee
Managers develop action plans
Managers and employees periodically review the employee's performance
The manager makes a performance appraisal and rewards the employee according to results.

The 3 types of objectives

Improvement Objectives - Express performance to be accomplished in a specific way for a specific area.
Personal Development Objectives - Express personal goals to be realized.
Maintenance Objectives - Express the intention to maintain performance at previously established levels.

3 factors for successful MBO

Top management must be committed
It must be applied organization-wide
Objectives must "cascade"

Cascading

Objectives are structured in a unified hierarchy, becoming more specific at lower levels of the organization.

Organizational
Divisional
Departmental
Individual

Planning/Control Cycle

Two planning steps (1 and 2) and two control steps (3 and 4).

Make the plan
Carry out the plan
Control the direction by comparing results with the plan
Control the direction by taking corrective action in two ways:

By correcting deviations in the plan being carried out
By improving future plans

About this deck

By: Phil Crain
Created: 2011-11-01
Size: 40 flashcards
Views: 2

About StudyBlue

“Simply amazing. The flash cards are smooth, there are many different types of studying tools, and there is a great search engine. I praise you on the awesomeness.”
Dennis