PLANNING
IE 103 ENGINEERING MANAGEMENT
“if you don’t know
where you are going,
any road will lead you
there”
“if you don’t know where you are going,
any road will lead you there”
➢ “this tells me that if you don’t know what you want in life, you will have a never
ending exploration…..”
➢ “….we should know our interest as early as now because life is too short if you
will take your time travelling on a wrong road.”
➢ “without any planning in your life, you don’t have any proper or right path to
go. Yes, any road will take you there but are you happy with the word “bahala
na”. No!!!!, you must know your way, make your own road in order to be safe”
➢ It’s hard to tell whether in the future you will succeed or not, you’re not
certain where you are going. But as long as you have the plans or the roads that
you prepared, you will be in your right destination at the end of your journey”
⚫ High performers develop a specific plan, they map out specifically
how they will achieve their goals. Their plan focuses on effectiveness,
efficiency, and impact. They are purposeful in what they want to achieve,
so they have strong plans in place
⚫ With a plan that is purposeful, high performers can adapt to “road
conditions.”
⚫ Everyone is time constrained–our customers, our team members, our
managers. We don’t have enough time to accomplish everything we want
or need to accomplish. The highest performers manage this by having
clear plans in place, executing those plans relentlessly, by paying attention
to the signals they encounter–adjusting their plans appropriately
Planning
⚫ Planning, a major function of engineering management, is the work done to
predetermine a course of action.
⚫ Planning defines who will do what, how, where, when and with which resources.
⚫ Planning ismade necessary by rapid changes in technology (such as Web-based tools,
enterprise resource-planning software, broadband communications options, and
mobile access), environment (customer, global resources, competition, and
market place) and organization (such as mergers, acquisitions, alliances, and
outsourcing) (Chang 2005).
Planning
⚫ Planning is defined as the process of defining the organization’s
objectives or goals, establishing an overall strategy for achieving
those goals and developing a comprehensive hierarchy of plans to
integrate and coordinate activities (Robbins, 2001).
⚫ Planning gives direction, minimizes waste and redundancy, sets
standards used in controlling and reduces the impact of change.
Planning at Various Management Level
1. Top management level – strategic planning
2. Middle management level – intermediate planning
3. Lower management level – operational planning
Strategic planning – refers to the process of determining the major goals of an
organization and the policies and strategies for obtaining and using resources to achieve
those goals.
Strategic planning is a systematic process through which an organization agrees on
priorities that are essential to its mission and are responsive to the environment
(Allison and Kaye, 2005).
Chang (2005) further stressed that strategic planning helps organizations on identifying
worthwhile future activities. It assures that organization applies its resources effectively
to achieve the long term goals of the company.
Planning
Intermediate planning – refers to the process of determining
the contributions that sub units can make with allocated
resources.
The goals of a sub unit is determined and a plan is prepared to
provide a guide to the realization of the goals
Operational planning- determining how specific tasks can
best be accomplished on time with available resources.
Types of Plans
FUNCTIONAL AREA PLANS
Plans maybe prepared according to the needs of the different functional areas.
1. Marketing plan – this is the written document or blueprint for implementing and
controlling an organization’s marketing activities related to a particular marketing
strategy.
2. Production plan – this is a written document that states the quantity of output a
company must produce in broad terms and by product family
3. Financial plan – it is a document that summarizes the current financial situation of the
firm, analyzes financial needs, and recommends a direction for financial activities.
4. Human resource management plan – it is a document that indicates the human
resource needs of a company detailed in terms of quantity and quality and based on
the requirements of the company’s strategic plan.
Types of Plans
PLANS WITH TIME HORIZON
1. Short-range plans – these are plans intended to cover a period of less than
one year. First line supervisors are mostly concerned with these plans
2. Long range plans – these are plans covering a time span of more than one
[Link] are mostly undertaken by middle and top management.
PLANS ACCORDING TO FREQUENCY OF USE
1. Standing plans – these are plans that are used again and again, and they
focus on managerial situations that recur repeatedly.
Classifications
a. Policies – they are broad guidelines to aid managers at every level in
making decisions about recurring situations or functions.
b. Procedures – they are plans that describe the exact series of actions to be
taken in a given situation.
c. Rules – they are statements that either require or forbid a certain action.
2. Single use plans – These plans are specifically developed to implement
courses of action that are relatively unique and are unlikely to be
repeated.
Example:
1. Budgets – plans which sets forth the projected expenditure for a certain
activity.
2. Programs- plans to coordinate a large set of activities
3. Projects
Strategic Planning Process
The fundamental phases of the strategic planning process, as outlined in the book
of Allison and Kaye (2005), Strategic Planning for Nonprofit Organizations are
found below:
Phase 1: Getting Ready
1. Identify the reasons for planning
2. Set up the planning process
3. Develop a plan for gathering information
4. Design a planning process to meet the organization’s needs
5. Develop a “plan for planning” worksheet
Phase 2: Articulate Mission,Vision and Values
1. Create or revisit a mission statement
2. Draft a vision statement
3. Articulate/affirm the organization’s values, beliefs and guiding
principles
Phase 3: Assess your Situation
1. Summarize organization’s history and accomplishments
2. Articulate previous and current strategies
3. Gather information from internal and external stakeholders
4. Evaluate current programs
5. Summarize information collected
Phase 4: Agree on Priorities
1. Make sense of the data collected
2. Asses program portfolio and agree on competitive growth strategies
3. Summarize future program portfolio
4. Agree on the future strategies
5. Agree on administrative, financial, and governance priorities
Phase 5:Write the Plan
1. Create goals and objectives
2. Develop long-financial projections
3. Write the strategic plan
4. Adopt the strategic plan
Phase 6: Implement the Plan
Phase 7: Evaluate and Monitor the plan
Content of the Strategic Plan
A strategic plan is simply a document that summarizes why an organization
exists, what is trying to accomplish, and how it will go about doing so. Depending
on the intensity of the strategic planning process used – abbreviated (one or two-
day), moderate (one to three months), or extensive (six to nine months) –
strategic plan will have slightly different formats containing various levels of
specificity and length.
[Link]
For moderate planning process, the strategic planning will include the following elements as
discussed by Allison and Kaye (2005):
1. Introduction by the President of the Organization- introduces the plan to readers; it gives stamp
approval to the plan and demonstrates that the organization has achieved a critical level of internal
agreement.
2. Mission and Vision Statements
3. Summary of Core Strategies – this section makes explicit the strategic thinking behind the plan and
tells the readers where organization will be primarily focusing its resources over the next few years.
4. Program Goals and Objectives – this is the heart of the strategic plan for it details what the
organization intends to do over the next few years.
5. Optional appendices: summary of situation assessment, summary of client surveys, summary of any
others stakeholder surveys or interviews.
According to Allison & Kaye (2005), strategic plan may be written without long-range financial
projections since the overall directions set in the strategic plan will still guide the allocation of
resources to support any programs, fundraising, administrative, and governance functions.
Parts of the various functional area plans
Marketing Plan:
1. The Executive Summary – which presents an overall view of
the marketing project and its potential
2. Table of contents
3. Situational analysis and target market
4. Marketing objectives and goals
5. Marketing strategies
6. Marketing tactics
7. Schedules and budgets
8. Financial data and control
PRODUCTION PLAN:
1. The amount of capacity the company must have
2. How many employees are required
3. How many material must be purchased FINANCIAL
PLAN:
1. An analysis of the firm’s current financial condition
2. A sales forecast
3. The capital budget
4. The cash budget
5. A set of pro forma (projected) financial statements
6. The external financing plan
HUMAN RESOURCES PLAN
1. Personnel requirements of the company
2. Plans for recruitment and selection
3. Training plan
4. Retirement plan