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Business Planning and Organization

Written by: Jet Eloriaga
Posted Feb 16, 2022
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Image by Gerd Altmann from Pixabay
Strategic, tactical and operational plans are the outputs of the managers at the executive and supervisory levels during the phase of planning the firm's direction and organizing its resources to support its objectives.

The said levels of planning encompass different lengths of time of applicability and the higher levels determine what may be planned at the lower levels. That is, the strategic blueprint guides the tactical, which in turn guides the operational.

Considering that such plans that are the outputs of the said stages span periods of time that are beyond what can be easily monitored on a day to day basis, having software that puts the needed controls in place to ensure the realization of those plans is well advised.

How Software Supports Planning In All Levels

As an example of how software can enable if not enforce the linkages from the strategic to the operational plans, the top level strategic budgets will serve as the limits of the lower tactical budgets, which in turn will determine the constraints for the operational budgets. Now given that budgets may vary in as many possibilities as there are types of plans, they all follow nevertheless the same trickling down pattern such that the sum of the lowest level budgets can only get as much as the next higher level budgets. Ensuring this is a trivial function for a software.

A few general organizational structures exist at the management's disposal to define how the firm plans to realize the plans it has laid out. Whatever formal structure may be decided however, the key issues that are considered are authority, responsibility, accountability, and delegation.

The ability to make decisions, issue orders, and allocate resources define the authority of a manager. The set of tasks assigned to a personnel determine his responsibities. These two clearly identify accountability.

As a definite output of the organization stage, a formal organization structure will be produced. This structure will specify who reports to whom and who is accountable for what.

The division of labor and specialization (horizontal) as well as the chain of command (vertical) will be made clear by an organizational chart.

Now this organization structure should be described by a software application by more than just a set of lists of positions and responsibilities if it is to enable the implementation of the plans at the aforementioned different levels. For example, for any performances that are below the desired level based on the established plans it should be easy to identify where exactly in the organization the problem is originating from. The software itself should at least point in the right direction where a review must be made. This is because it should be clear from the list of responsibilities of any position how it supports the realization of the plans within its level. And, if properly designed, this can be accomplished by the software regardless of how much or how little the authorities and responsibilities are centralized within the organization.

Thus as early as when the firm is still setting up its organizational structure, putting the appropriate software already in place will be invaluable in ensuring the strategic, tactical and operational plans are always referred to and, more importantly, adhered to.
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