3. chapter6 Learning Outcomes
• Define goals and plans and explain the relationship between them.
• Explain the concept of organizational mission and how it influences goal
setting and planning.
• Describe the types of goals an organization should have and how
managers use strategy maps to align goals.
• Define the characteristics of effective goals.
• Describe the four essential steps in the management by objectives (MBO)
process.
• Explain the difference between single-use plans and standing plans.
• Describe and explain the importance of contingency planning, scenario
building, and crisis planning in today’s environment.
• Summarize the guidelines for high-performance planning in a fast-
changing environment.
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4. Does Goal Setting Fit Your
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Management Style?
• Managers must plan where the organization
should go in the future
• Managers must plan for unexpected events
• The company establishes a basic mission and
develops goals and objectives
• Plans should meet environmental changes and
expectations of stakeholders
• Planning is fundamental to all organizations
• Everything stems from planning
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5. chapter6 Overview of Goals and Plans
• A goal is a desired future state that the
organization attempts to realize
• A plan is a blueprint for goal achievement
• There are different levels of planning and
goals in an organization
• Goals at each level of the organization
guide the organization
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7. Characteristics of
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Goals and Plans
Legitimacy
Source of motivation and commitment
Resource allocation
Guides to action
Rationale for decisions
Standards of performance
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9. chapter6 Organizational Mission
• The mission statement is the reason the
organization exists
– Top of the goal hierarchy
– Describes the values, aspirations and reason
for being
– A well-defined mission is the basis for all
other goals
• Mission statements outline the stated
purpose and values to stakeholders
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10. chapter6 Types of Goals and Plans
• Strategic Goals – official goals, broad statements
about the organization
– Define the action steps the company intends to attain
– The blueprint that defines activities
• Tactical Goals – help execute major strategic plans
– Specific part of the company’s strategy
– Plans of the divisions and departments
• Operational Goals – results expected from
departments, work groups, and individuals
– Lower levels of the organization
– Specific action steps 10
11. Aligning Goals
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with Strategy Maps
• Goals should be consistent and mutually
supportive
• The achievement of goals at low levels
permits the attainment of high-level goals
• Individuals, teams, and departments
should be working in concert
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13. chapter6 Operational Planning
• Operational goals should direct employees
and resources toward outcomes
• It is important to establish effective goals
– Management by objective
– Single-use plans
– Standing plans
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15. chapter6 Management by Objective
Defined by management scholar
Peter Drucker in his 1954 book,
The Practice of Management
Process of defining goals and
monitoring progress
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21. Planning for High
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Performance
Traditional Approach: High-Performance
• Done by top Approach:
executives (top down) • Decentralized planning
• Central planning • Managers plan
departments throughout the
• Planning specialist organization
• Now involves line-
Stretch Goals and Big managers and
Hairy Audacious employees
Goals (BHAG) are big • Dynamic plans for fast-
and inspiring changing needs
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22. Performance Dashboard
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for Planning
• Gauge progress
toward goals
• Align and track
goals
• All employees can
track progress
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