Chapter Summary Section 3.1 Planning Basics LO 3.1-1 Summarize the planning function of management. Planning is the process of setting goals and objectives and deciding how to accomplish them. It is referenced as the primary function of management because it forms the foundation for all other management functions. Planning requires that managers understand the challenges a business faces and know how to apply the decision- making process. Without planning, an organization would not be successful. LO 3.1-2 Discuss establishing goals. Goals are the desired outcomes or targets that an organization is striving to accomplish. They are the first step in planning and serve as guidelines for the decisions and actions of managers. Plans can then be developed to work toward the completion of those goals. For a goal to be effective, it should be a SMART goal. LO 3.1-3 Identify types of plans written by management. Three types of plans that managers typically create include a strategic plan, tactical plan, and operational plan. Most managers also have a contingency, or backup, plan. LO 3.1-4 Explain market research used for planning. Market research for the planning process includes reviewing the environment in which the organization operates. Two types of research are primary and secondary. Primary research is first-hand research conducted by a researcher. Secondary research is data already collected and recorded by someone else. LO 3.1-5 Cite examples of data analysis used for planning purposes. Two important analyses that help businesses make decisions during the planning process include market analysis and sales analysis. Section 3.2 Developing Plans LO 3.2-1 Summarize the strategic planning process. The strategic planning process involves setting goals and allocating the resources necessary to achieve them. The process helps an organization look to the future and plan how to get there. The steps involved include review organizational mission and vision statements, establish organizational goals, conduct a situation analysis, and formulate a strategic plan. LO 3.2-2 Explain the role of tactical plans in an organization. Tactical plans define how an organization will use its resources to accomplish specific goals related to strategic plans. The plan outlines precise details on how to accomplish specific goals, work that will be done, who will do it, and what resources will be used. LO 3.2-3 Describe two types of operational plans. Operational plans can be single-use or ongoing. A single-use plan is created for a specific purpose, such as sales. An ongoing plan is created once and updated as needed. Examples include schedules, policies, and procedures. Chapter 3 Review and Assessment 52 Copyright Goodheart-Willcox Co., Inc.