Why do Managers Plan 1 Why do Managers Plan? Management 301 Distance Learning December 07, 2011 Why do Managers Plan 2 Why do Managers Plan? Strategic Planning This seems like a very cut and dry topic to discuss, but there is no single reason that a manager makes plans in the work environment. I will cover several areas in which managers use planning, and why it is an essential part of accomplishing tasks, and how it streamlines processes necessary for an organization to be successful.
First, I will discuss strategic planning: strategic planning can also be referred to as “charting the course” for a business or organization. A central part of strategic management is performance measurement (Public Administration Review, December 2010). Unlike private sector business organizations, many government and public agencies have developed performance measurements without developing strategic plans. I think that this is primarily due to the infrastructure that is set in place in most government or public agencies, and the amount of red-tape that accompanies government ran agencies.
Regarding the private sector, I believe that having a strategic plan to guide managers and leaders in the decision making process allows them to identify alternative steps or measures to take in the event that something in the business process changes that they have no direct control over. Managers who develop a strategic plan also are likely to recognize that the end result cannot be their only concern, but they identify milestones that must be met along the ay, or during the process to use as a measurement tool to determine if they are making positive progress or if they need to examine “glitches” that will delay or have a negative impact on the business process. One tool to measure performance is a “Balanced Scorecard”. It is grounded in the idea that the measurement Why do Managers Plan 3 of an organization’s performance ought to take into account the processes and resources needed to produce outcomes, as well as the outcomes themselves.
In some ways, its emphasis on inputs and outputs is a step back in performance measurement, but that step is designed to help organizations fulfill the results promised. (Public Administration Review, December 2010). I believe that this is a vital step, if not the first step in planning that will help ensure a business or organization has a set path that will enhance their possibilities of success. Knowledge Management in Organizational Planning is the next area that I want to discuss.
When people talk about managers making plans for operations or processes in a business or organization it is likely that they are referring to plans that include forecasts. This type of planning is appropriate if the future of or in the business environment is stable; however, this is not always the case with many businesses because they face business environments that are complex and unstable (Knowledge Management in Organizational Planning, January 1987).
With this being the case in most business environments today, the leadership of these businesses continue to pursue planning and forecasting tools and technology that will help them when they are developing strategic and organizational plans. Knowledge management might also be referred to as Management Information Systems (MIS). This is a computer program or network that was developed for management and leadership members to use for the purposes of planning and may have examples of past planning events or projects that the current managers can use to aid them in the planning and decision making process.
One significant advantage of this type of system is that it can provide historical data that allows good planning to be done from the beginning, and
This MIS is just another tool to emphasize why managers plan. Another area that planning is important for managers is multi-project planning and resource control. This area is also related to the area of enterprise resource planning (ERP). Both of these areas require the use of business planning tools to make the manager’s job of planning for needed materials and resources much easier to manage through the use of technology and computer programs.
One of the most challenging aspects of a manager’s job is to ensure that he/she effectively manages projects or production processes without exhausting the organization’s limited resources (Multiproject Planning and Resource Controls, December 2006). When we talk of managers, I think it is important to realize that managers are in all industries including retail, production, manufacturing, and construction to name a few, and the one common link that they all share is planning.
Planning is the bedrock or foundation that managers must establish as a starting point no matter the industry which they work. The important parts of planning that are related to multi-project and ERP management are identifying the resources needed to start and sustain work processes to eliminate loss time due to a shortage of resources, and how the ERP system works together with other internal business systems to enhance the planning of management.
An example of this could be that the ERP system interfaces the maintenance projects that are being actively worked with the supply or requisitioning process to ensure that needed resources such as materials and tools are being ordered to meet the project or job requirements. The ERP system Why do Managers Plan 5 can be programmed to recognized or identify items needed based on job number or serial numbers related to specific aspects of the job that were identified during the initial planning phase of the job or project.
The items that would be ordered due to this planning would be added to what is commonly referred to as a “pick-list”. This part of the ERP system is known as the interaction between structure and human action and is called the “duality of structure, which simply means (in this case) the interaction between the ERP system (usually managed by a materials manager), the ordering of resources (between materials manager and vendors), and communication between the project or production manager and the system (actual input into the system) (business benefits from ERP systems, Staehr, 2008).
The ERP systems ability to identify this process in only possible due to the initial planning that was performed by the manager in charge of the projects or processes, and communicated and planned with the materials manager to ensure the system was interfaced to the processes. I have actually used an ERP system called SAP, and these types of systems require a lot of training and “hands on” work because they can be very complex to use.
Another extremely important and relevant planning tool that managers can use is the Production Planning Model. This PPM might also be referred to as Material Requirement Planning (MRP). The MRP is a vital tool for managers who work as maintenance managers, production managers, or operations managers. Managers use the MRP to identify the amount of spare parts that need to be either “on hand” or quickly procured to ensure there is limited or no equipment down-time due to the lack of parts to make needed repairs for process equipment.
It is important that managers who work in these types of environments are the not just the process manager, but the planning manager. I make the Why do Managers Plan 6 previous statement because the manager who develops the operational or process plans should use the equipments historical data to identify operational and down-time trends. They should also use Bills of Materials (BOMs) to identify parts that will be more likely to fail due to the amount of use, or are more susceptible to wear from continuous use in the operation or process.
This topic is important to discuss because many plants or facilities might have the capability to manufacture parts in their own machine shops, and this can be a cost savings measure as well as a time saving measure. This is why it is important that the planning manager identify this as a possibility or a preference during the planning phase of the job to be performed. Using MRP helps manufactures and managers determine precisely when and how much material to purchase and process based on a time phased analysis of sales orders, production orders, current inventory, and forecasts (Production planning model, April 2009).
MRP determines material requirements based on master production and planning schedules which are used in conjunction with one another to ensure an efficient work process. A primary reason that managers use the production planning model is to reduce the levels of parts or goods on hand. In other words, if proper planning is performed prior to starting the job or production process the manager will be able to determine the parts needed/required from start to completion of the process and save inventory costs by only having the required parts on hand with no excess.
Once it is determined how much product will be produced it makes it much easier to determine the amount of parts or spare parts that will be needed. When managers are planning for a production run it is important for them to be aware of any future product orders that might follow closely after the production Why do Managers Plan 7 process or run that they are planning for, so they can consider having more spare parts on hand to aid the planning process of the following project or product run.
Good communication among the management team is crucial to the overall success in the planning phase of all work processes. The advantage of using the MRP to assist in the planning stage of projects or production processes is that it allows the planning manager to use historical equipment data, and maintenance data to develop a trend analysis and determine the appropriate amount of parts required during a specific production process. In summary, I have used several different examples to emphasize and support why managers plan.
I know that some of the examples that I used to illustrate my points might be broad, and even complex with regards to using ERP and MRP as tools to aid in planning, but I feel they were essential elements for me to use to stress that planning is often difficult and requires the use of technology to properly forecast outcomes etcetera. I have worked as a manager in charge of maintenance planning processes in a manufacturing environment, so I know from firsthand experience the importance of planning.
I have used a management information system program (SAP Plant Maintenance Module) to integrate and implement plans and procedures, and it can be very time consuming and complex, but if we had not used a system such as this to help develop plans we would not have been able to effectively perform maintenance procedures and the company could have suffered catastrophic equipment failures. I know that we have probably all heard the old saying that “failing to plan is like planning to fail”, well in the case of “Why do Managers Plan? I would have to say that I agree with that old Why do Managers Plan 8 saying, and that managers plan to ensure their efforts are successful, and to ensure the success of the organization as a whole. Why do Managers Plan 9 References: Professional Article: Strategic Planning and Balanced Scorecards: Charting the Course to Policy Destination, Edward T. Jennings, Jr. , University of Kentucky. Public Administration Review, dated: December 2010. Professional Article: Knowledge Management in Organizational Planning, Lynda M. Applegate, Tsung Teng Chen, Benn R.
Konsynski, and Jay F. Nunamaker, Jr. Twentieth Annual Hawaii International Conference on System Sciences, Honolulu, Dated: January 6-9,1987 Multiproject Planning and Resource Controls for Facility Management, E. William East and Liang Y. Liu, dated: December 2006. Understanding the role of managerial agency in business benefits from ERP systems, Lorraine Staehr, La Trobe University, Dated: 2008. Production planning model with simultaneous production of spare parts, P. Cyplik, L. Hadas, and M. Fertsch, Poznan University of Technology, Poznan, Poland, Dated: April 2009.