Planning and Control Techniques Module
In the study of this module, students will have an opportunity to learn essential
knowledge about the planning tools and techniques that can help any business to reach
the objectives driven by its organizational mission.
CHAPTER OUTLINE
INTRODUCTION
This section introduces some of the basic planning tools and techniques that can
be used by managers in helping organizations to achieve their goals.
1. TECHNIQUES FOR ASSESSING THE ENVIRONMENT
The following techniques have been developed to assist managers in assessing
the organization’s environment:
1. Competitor intelligence is an environmental scanning activity by
which organizations gather information about competitors. In
2. Global scanning is an especially important type of environmental
scanning used by managers to assess changes and trends in the
1. Forecasting techniques can be grouped into two main categories:
a. Quantitative forecasting applies a set of mathematical
2. Forecasting Effectiveness. Managers must consider effectiveness
when deciding which forecasting techniques to use.
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1. Use simple forecasting techniques.
2. Involve more people in the process.
4. Do not rely on a single forecasting method.
6. Forecasting is a managerial skill and can be
practiced and improved.
1. A benchmarking planning team is formed. The team’s initial task is
2. The team collects internal and external data.
4. An action plan is prepared and implemented.
2. TECHNIQUES FOR ALLOCATING RESOURCES
Resources are the assets of the organization including financial, physical,
human, intangible, and structural/cultural.
1. Incremental budgeting starts with the current budget from which
managers decide whether additional resources are needed and
2. Zero-based budgeting (ZBB) starts with an established point of
zero rather than using the current budget as the basis for adding,
1. Gantt Charts. The Gantt chart, developed by Henry Gantt, who
2. Load Charts. A load chart is a modified Gantt chart that
3. PERT Network Analysis. The Program Evaluation and Review
Technique (PERT) is a technique for scheduling complicated
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2. Activities are the time or resources needed to
3. Slack time is the amount of time an individual
4. The critical path is the longest sequence of
activities in a PERT network.
c. Refer to Exhibit PC–9 to see an example of a PERT
3. CONTEMPORARY PLANNING AND CONTROL TECHNIQUES
Project management and scenario planning are two planning techniques that are
1. Project Management Process
2. Role of the Project Manager
a. The only real influence project managers have is their
1. Developing scenarios is also known as contingency planning.
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3. Scenario planning is difficult to use when forecasting random
events.
4. Exhibit PC-13 outlines the project planning process.
PC–1. Describe the different approaches to assessing the environment.
Environmental scanning is the screening of large amounts of information to anticipate
and interpret changes in the environment. Environmental scanning establishes the basis
PC–2. Describe the four techniques for allocating resources.
The four techniques are budgeting, scheduling, breakeven analysis, and linear
PC–3. How does PERT network analysis work?
PC–4. Why is flexibility so important to today’s planning techniques?
PC–5. What is project management, and what are the steps managers use in planning
projects?
PC-6. It’s a waste of time and other resources to develop a set of sophisticated
scenarios for situations that may never occur. Do you agree or disagree? Support your
PC-7. Do intuition and creativity have any relevance in quantitative planning tools and
techniques? Explain.
PC-8. The Wall Street Journal and other business periodicals often carry reports of
companies that have not met their sales or profit forecasts. What are some reasons a
company might not meet its forecasts? What suggestions could you make for improving
the effectiveness of forecasting?
PC-9. In what ways is managing a project different from managing a department or other
structured work area? In what ways are they the same?
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PC–10. What might be some early warning signs of: (a) a new competitor coming into
your market, (b) an employee work stoppage, or (c) a new technology that could change