The Function of Management Planning - Essay Example

Management Planning Paper Planning is one of the main managerial functions which determine organization objectives and purposes, so that everyone understands what they have to accomplish. All managers are involved in planning but the nature of policies and plans set out by superiors will vary with each manager's authority. While senior executives plan the direction of the organization, managers at various level-prepare plans for their own section which are part of the overall aims of the organization. For many years, Arthur Anderson, an accounting company, has followed successful planning strategies based on ethical, legal and corporate social issues. Within this organization, planning involved selecting enterprise goals and department objectives then finding ways of achieving them. Plans depended upon the existence to alternatives, and then decisions had to be made regarding what to do, how to do it, when to do it and by whom it is to be done. Author Anderson has a responsibility to meet society's expectations in three concentric circles of responsibility (Arthur Andersen, 2007). The inner circle includes business's clear economic responsibilities such as quality and safety and the provision of jobs and services. The intermediate circle expands the responsibility of businesses to make their policies and practices consistent with societal values in such matters as fair employment practices and a benign environmental impact (Accounting Industry, n.d.). The nature of ethical standards is one of the key issues to be addressed by personnel managers operating in large corporation. There will gradually be a growing together of national practice on working hours, but it will take a lot longer for rates of pay to harmonies. Arthur Anderson adopts CSR because some moral justification comes from a value system that is independent of the business itself and where individual opinion can be sharply divided. SCR implies that employees at work should be honest and that claims about a product or service should be accurate. Ethical issues are corporate behavior and fair competition. In order to meet these objectives, Arthur Anderson uses systematic planning. Fair competition is achieved by adoption of specific ethical rules which guides management and marketing policies. Risk and uncertainty is minimized by planning and this is needed more today than before as social and economic conditions alter very quickly and careful planning enables an organization to prepare for change. Planning helps Arthur Anderson to define its purposes and activities according to fair competition rules. It enables performance standards to be set and results can therefore be compared with the standard to enable managers to see how the organization is proceeding towards its goals. Planning is flexible to deal with a changing environment. Corporate behavior means that employees follow established norms combining their own judgment with benefits of the corporation. In this case, the ethical responsibility of Arthur Anderson is to analyze social conditions and possible threats of their services for potential consumers. They should be well aware of educational background of their customers and their expectations (Corporate Social Responsibility, 2007). Social responsibility translates into expectations that businesses comply with the spirit of society's laws and with the normative base that under girds them. The social responsibility issues followed by Author Anderson are attitude of management to labor and fair reward and use of shareholders capital. Attitude of management to labor is achieved through fair payment schemes and healthy corporate climate, training programs and promotion activities. Arthur Anderson provides additional training focusing on employee's motivation and work design programs to help worker identify their goal and professional development strategies. Arthur Anderson designs programs of development in accordance with the culture and specific requirements of the particular department, and the demands of particular managerial jobs. There is a clear development policy together with regular reviews of individual performance and a program of career progression. The higher up the hierarchy of management, the more attention is paid to planning, particularly in setting out goals and strategies for a long period ahead. Managers lower in the hierarchy usually deal with sections of the total plan, and are concerned with shorter periods of time. In this case, fair use of shareholders capital is the main responsibility of top managers directly involved in planning process. Capital planning is essential for the long-term survival of this business enterprise as it helps to determine the most profitable way to allocate limited resources among competing ends (Corporate Social Responsibility, 2007). The legal category specifies that in the process of producing and distributing services, businesses must abide by the laws of society. The main legal issues it follows include data protection and health conditions. The planning and strategies are based on the 'data protection principles', one of which is that people must be made aware that information which might personally identify them is being collected. If they are not told this at the time the information is collected, the Act's requirement that information be obtained 'fairly' is contravened, and this appears to be happening at the government's site, as at many others. Arthur Anderson management team ensures adequate safety precautions and welfare services. Human resource management is intimately involved with the environment in general and certain trends are noticeable (Basics of Strategic Planning, n.d.). In general, management of Arthur Anderson take into account social and legal factors which influence employees and social image of the company. Its plans are used upon clearly defined objectives and make use of all available information. Plans consider factors in the environment which will help or hinder the organization in reaching its goal. This is important, as plans develop from the lower levels of administration whose reaction and responses may change and help to form plans. The types of planning are strategic, tactical, operational and contingency planning. The factors affecting strategic planning are competition, market fluctuations and opportunities for growth. The future is uncertain and numerous techniques have been evolved to try and limit the amount of uncertainty. In accounting industry, the internal environment of a corporation consists of variables (strengths and weaknesses) that are within the organization itself and are not usually within the short-run control of top management. These variables form the context in which work is done. Overall business strategy, potential and capability to support high performance environments are the key elements for the next years. The stage after assessing the external environment is to assess the firm's resources based upon knowledge of its strengths and weaknesses (Basics of Strategic Planning. n.d.). Tactical planning is influenced by factors crucial for success, environmental compliance legislation and historical compliance requirements. Clearly, some companies in the same industry are more successful than others, lending support to the view that competitive advantage is largely internally developed. Equally, however, there is a danger of ignoring the environment, as customers and their needs, competitors, changes in technology, etc., can play an important role in determining competitive success. Arthur Anderson has a reasonable amount of flexibility in order to meet legal changes and requirements. Factors crucial for success involve specific industry requirements and customers expectations. For example, there should be room for individual discretion and creativity and the organizational structure should be such as to produce an environment whereby individual performance most effectively contributes towards group goals (Operational management, 1998). Contingency planning is influenced by organizational structure, life circle of the organization and environmental uncertainty. The main activities and resources of the company are analyzed and assessed and this forms a background for judging the firm as a whole and assessing its efficiency and effectiveness. This will include its planning and control systems operating procedures and the effectiveness of its organization structure. The strengths and weaknesses of the organization can be examined by considering whether of not the firm's present strategy can deal with all the changes in the business environment (Contingency Planning, 1998; Ringle, 2002). Operational planning involves marketing factors, work schedule, inventory control. All this factors determine a procedure of inventory planning to ensure that the necessary parts and materials are available at the right time and place, and in the correct amounts. Inventory control is very important because it is concerned with the management of all resources from origin to final consumption. It encompasses materials management, purchasing and physical distribution management. Baseline schedule is closely connected with the efficiency levels which are driven by the normal productivity that can be expected from the type of person allocated to each activity, and the efficient allocation of the person is driven by the project schedule. It is important that this is tackled from a practical viewpoint and that due consideration is taken regarding normal modes of working and availability (Operational management, 1998). Summary: Planning activities employed by Arthur Anderson were aimed to satisfy requirements of different clients. They helped to meet the needs of a particular customer and provide specific personal service for everyone. In the infrastructure of Arthur Anderson quality was the major question. External and internal drivers have a direct impact on the internal needs of any company. It should be mentioned that the external and internal factors such as structure, ethical and social responsibility, people, technology and task are all interdependent as a change in one. Each phase starts with a set of information and ends with a set of deliverables. References 1. Accounting Industry. (n.d.). Retrieved from http://www.opensecrets.org/news/accountants/index.asp 2. Arthur Andersen (2007). Retrieved from http://en.wikipedia.org/wiki/Arthur_Andersen 3. Basics of Strategic Planning. (n.d.). Retrieved from http://www.fpm.iastate.edu/worldclass/strategic_planning.asp 4. Contingency Planning. (1998). Retrieved from http://www.directives.doe.gov/pdfs/doe/doetext/neword/430/g4301-1chp11.pdf. 5. Corporate Social Responsibility (2007). http://www.hse.gov.uk/corporateresponsibility/index.htm 6. Operational management. (1998). Retrieved from http://worldanimal.net/onlinebook/Chapter%206%20Operational%20Management.pdf. 7. Ringle, K. (2002) Arthur Andersen, The Accountant Who Built His Name on Energy http://www.washingtonpost.com/ac2/wp-dynpagename=article&node=&contentId=A52634-2002Jan28 Read More