Lecture 8 SME

7/30/2019 Lecture 8 SME

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Lecture 8: Planning,Organizing & ControlChapter 10 & 12


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Circular Nature of

Organizational Planning

Setting Goals

Defining SkillNeeds

Filtering SkillNeeds

EvaluatingPerformance


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Line and Staff Line authority the right to lead. Do it and do it

now.

Staff authority the right to solve problems. Youought to do it in this way because its the bestway.

The Line Organization every job holder reports

to a single boss; no one has staff function.

The Functional Organization a job holder mayreport to two or more bosses.


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Delegate the authority To get the work done

To allow key employees to take initiative

To keep things going in the entrepreneursabsence


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TQM The pursuit of excellence

Quality what does it mean?

Quality is excellence that is better than a minimum standard.It is conformance to standards and fitness of purpose

ISO 9000:2000 definition of quality- It is the degree to which a set ofinherent characteristics fulfills requirements.

Quality is fitness for useof the product Joseph Juran.

Quality is also defined as excellence in the product or service thatfulfills or exceeds the expectations of the customer.


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Quality is the qualifier

Doing it right first time and all the time. Thisboosts Customer satisfaction immensely and

increases efficiency of the Business operations.

Clearing the bar (ie. Specification or Standardstipulated) Excellence that is better than aminimum standard.


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TQM six basic Concepts

Management commitment to TQM principles and methods& long term Quality plans for the Organisation

Focus on customers

internal & external

Quality at all levels of the work force.

Continuous improvement of the production/business

process. Treating suppliers as partners

Establish performance measures for the processes.


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TQM Myths TQM is only for large businesses

TQM is used by only manufacturers


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4 Stages of Growth Pre birth

Acceptance

Break through

Maturity


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A blueprint of the actionsnecessary to reach the desired

goal.

Goal A desired future state that the

organization wants to achieve.

Plan What do we want?

How do we get there?

Goals and Plans


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The shift from informal planning

to formal planning

Random Planning

Reactive decision making

Isolated decision making

Subjective decision making

Guessing results

Systematic Planning

Proactive decision making

Team decision making

Objective decision making

Analyzing possibleoutcomes

From: To:


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MBO

Management by Objectives (MBO)

A structured process of regular communication.

Supervisor/team leader and workers jointly set

performance objectives.

Supervisor/team leader and workers jointly review

results.


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How does management by objectives

operate?

MBO involves a formal agreement

specifying

Workers performance objectives for a

specific time period.

Plans through which performance objectives

will be accomplished.

Standards for measuring accomplishment of

performance objectives .

Procedures for reviewing performance

results.


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The MBO process:

Supervisor and workers jointly set objectives, establishstandards, and choose actions.

Workers act individually to perform tasks; supervisorsact individually to provide necessary support.

Supervisor and workers jointly review results, discussimplications, and renew the MBO cycle.


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MBO Benefits and Problems

Benefits of MBO Problems with MBO

1. Manager and employee efforts

are focused on activities that

will lead to goal attainment.

2. Performance can be improved

at all company levels.

3. Employees are motivated

4. Departmental and individual

goals are aligned with company

goals.

1. Constant change prevents MBO

from taking hold.

2. An environment of poor employer-employee relations reduces MBO

effectiveness.

3. Strategic goals may be displaced by

operational goals.

4. Mechanistic organizations and

values that discourage participation

can harm the MBO process.

5. Too much paperwork saps MBO

energy.

Pl i


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PlanningPlan

Plans communicate goals to employees to coordinate functions such as salesand production. Financial plans are often expressed in the form of budgets (i.e.,

profit, cash, production budgets)

Action taken toImplement plan

C t l


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ControlPlan

Performance reports compare actual with planned (budgeted) performance.Management by exception is used meaning that only significant deviations are

investigated

Action taken to

Implement plan

Results

Comparison ofplanned and actual

results

Evaluation

Documents

Lecture 8 SME