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Three types of management planning: making organizations work.

There is abundant evidence that planning is the most prominent and pervasive of the management functions or processes. Planning is prominent because of the evidence of failure in organizations traceable to poor planning or preparation for the future on management's part. Planning is pervasive in that it cuts through all management functions and is a function that is applicable to all managerial levels. It cuts through the other management functions of organizing, controlling, staffing, directing, and decision making in the sense that it is a vital and necessary component of each of these processes. That is, managers must plan for each of the other functions. Planning is applicable to every managerial level because managerial action and decision making, whether at the chief executive's level or at the first-line supervisor's level, should ideally be predicated upon preliminary thought and anticipation of future issues, problems, or details that invariably come into play in the process of making organizations work.

Before planning is anything else, it is a mental process. It is a process of thinking through all facets of an issue or a problem before taking action. At the same time, it provides the ingredients for action.

Planning is a process that entails an assessment of the organization, its resources, and its environment, and encompasses the setting of objectives. Using that assessment as a backdrop, planning entails looking at the past, the present, and the future. So often we stress the futurity of planning to such an extent that we fail to make it clear that the past and the present are our points of departure. Using the past and the present as points of reference, in planning we consider both what we anticipate the future will be like, and what we desire it to be like.

Though we typically associate certain types of planning with specific management levels of the organization, it is contended here that each of the three types of planning presented should be done by all managers at each level. First, we will describe the three types of planning. Second, we will discuss how each of these is appropriate at any organizational level. The three types of planning we will discuss include:

* "To-Do-List" Planning

* Operational Planning

* Strategic Planning

"To-Do-List" Planning

Very few managers can function without a "to-do-list." Since managers are so busy, it is essential that they be able to list the projects, reports, meetings, or goals they need to accomplish on a day-to-day basis. Human nature seems to be that we respond well to actually, or mentally "checking off" activities that have been accomplished during the day. To-do-list planning is narrowly focused, daily or weekly in time span, and frequently personal. Nevertheless, it represents an invaluable discipline on the part of the individual manager desiring to see things "get done" or to "make the organization work."

Not only are "to-do-lists" valuable for personal planning, they are valuable mechanisms for delegating tasks to others. Instead of providing verbal instructions of what to do, provide your subordinates or co-workers with a "to-do-list" if you find that it is essential for that day or week. Personal experience indicates that others assume more of a responsibility for the task if it is written down than if it is verbally communicated.

Operational Planning

Operational planning is gauged toward the mid-range of time. This may be weeks, or months or may extend to a year or two. Typically, operational planning is derived from or is in response to an annual budget. Some planning experts have termed this type of planning tactical planning.

Whether it be driven by an organization's budget, a personal budget or a functional area of responsibility, operational planning focuses on getting the work accomplished effectively between now and some limited time period.

Another way of looking at operational planning is that it is in response to a more comprehensive strategic plan of the organization. That is, operational planning is derived from strategic planning. It flows from strategic planning. In essence, it may be seen as part of the implementation phase of a more comprehensive long range plan.

Planning or scheduling in the functional areas such as manufacturing, marketing, sales, and finance are examples of operational planning. Planning to meet monthly work orders is operational planning. Planning next year's annual meeting is operational planning. Though operational planning is often associated with middle-level managers, it is indispensable to top level executives and first line supervisors as well.

Strategic Planning

Strategic planning entails envisioning the total organization and its relationship to its external environment. Strategic planning involves determining the organization's products and/or services and matching these with demands or needs out in the marketplace. It also entails deciding how the organization will compete. What markets will be pursued and how? What long range goals will be pursued and how?

Strategic planning should be long range in nature. However, all long range plans pursued by organizations are not strategic in nature. A recent cartoon depicted this problem well. A manager types: "Short-term goals: Make it to 5:00 p.m." Next he types: "Long-term goals: String together a whole bunch of short-term goals!"

This is the way many managers think about strategic planning. They associate it with long-range planning but forget to associate it with strategic thinking which should question the way in which the organization is aligning itself with the environment--the marketplace.

SWOT analysis (which focuses on the organization's Strengths, Weaknesses and the environment's Opportunities and Threats) is an excellent conceptual model for thinking strategically. Strategic planning requires the manager to match the organization's strengths and weaknesses with those opportunities and threats present in the marketplace.

Pursuing the Three Planning Types

Managers at all levels--top, middle, and lower--require each of the three planning types we have discussed. Traditionally, strategic planning has been associated with top-level managers, operational planning has been associated with middle-level managers and "to-do-list" planning has been associated with lower-level managers, or supervisors.

The perspective suggested here, however, is that each of the three types of planning is essential at all three levels of management. To fully appreciate and comprehend how they are a part of a total organizational unit or team, first level supervisors want to have the broad, comprehensive picture provided by strategic planning. In addition, individual first- line departments will be in a better position to relate to the rest of the organization (and its attendant opportunities and threats) if it has carefully analyzed and assessed its strengths and weaknesses. In addition, the lower-level organizational units desire to understand how their activities impact mid-range planning and the organization's functional areas.

In the same way, middle-level managers need both strategic planning and "to-do- list" planning. The effectiveness of middle-level managers is enhanced if they can base their operational planning on a strategic view of the organization and strategic assumptions. Ideally, managers at this level are establishing their plans based upon a thorough appreciation of the organization's strategic plan. To do otherwise may direct these middle- level departments toward sub-optimal goals.

Finally, top level managers can function more effectively if they understand what operational plans must be developed based upon their strategic thinking. The key here would be to articulate the organization's strategy unambiguously so that middle-level managers would have sufficient direction to make sound decisions. In addition, top level managers will find that they, too, have a need for the more mundane "to-do-list" planning. They do not think strategically all the time, and this reality must be accommodated.

Summing Up

The management challenge at each level of the organization is to perceive how the three types of planning described are appropriate for all managers. Figure 1 summarizes the perspective needed for each planning type for each management level.

At all levels, planning must be seen as a "way of organizational life" primarily and not simply as a set of techniques. The planning challenge is to move from a reactive posture to a proactive posture and this can best be done by understanding the relationships among the three types of planning depicted in Figure 1.

An overarching goal of effective planning is to view it as a process that has no natural conclusion rather than as an event which ends until the next planning period rolls around. With this perspective, no plan is ever final. Rather, it is always subject to revision. It also is vital that the manager see the interconnectedness of the three types of planning and not see them as isolated planning types which are pigeon-holed to one level of management only. The effective manager of today and of tomorrow will become expert in the whole gamut of planning types and their appropriateness and applicability at his or her management level. This will be the key to making organizations work.


* Archie B. Carroll is a professor of management and holder of the Robert W. Scherer Chair of Management and Corporate Public Affairs at the University of Georgia, where he has served as a faculty member since 1972. Dr. Carroll received his three academic degrees from Florida State University.

Dr. Carroll has published twelve books and seventy articles, and his research has been cited is journal articles, books and other publications over 400 times. His special teaching and research interests are in business ethics, corporate social performance, and business and society. He has served in many professional level capacities, including the International Academy of Management, the International Association for Business and Society and the Southern Management Association.
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Author:Carroll, Archie B.
Publication:Management Quarterly
Date:Mar 22, 1993
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