How the planning process in dynamic and uncertain environment needs to be different from that of a more stable and predictable environment?

Answer 1

Introduction

Planning is a management tool, period. As with any management tool, it is used for one purpose only: to help an organization do a better job - to focus its energy, to ensure that members of the organization are working toward the same goals, to assess and adjust the organization's direction in response to a changing environment. In short, planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization is, what it does, and why it does it, with a focus on the future.

Planning in dynamic Environment

A word by word dissection of this definition provides the key elements that underlie the meaning and success of a planning process: The process is because it involves preparing the best way to respond to the circumstances of the organization's environment, whether or not its circumstances are known in advance; nonprofits often must respond to dynamic and even hostile environments.

The process is about planning because it involves intentionally setting goals (i.e., choosing a desired future) and developing an approach to achieving those goals. The process is disciplined in that it calls for a certain order and pattern to keep it focused and productive. The process raises a sequence of questions that helps planners examine experience, test assumptions, gather and incorporate information about the present, and anticipate the environment in which the organization will be working in the future.

Finally, the process is about fundamental decisions and actions because choices must be made in order to answer the sequence of questions mentioned above. The plan is ultimately no more, and no less, than a set of decisions about what to do, why to do it, and how to do it. Because it is impossible to do everything that needs to be done in this world, planning implies that some organizational decisions and actions are more important than others - and that much of the strategy lies in making the tough decisions about what is most important to achieving organizational success.

The planning can be complex, challenging, and even messy, but it is always defined by the basic ideas outlined above - and you can always return to these basics for insight into your own planning process.

Planning in uncertain environment

The uncertainty faced by a decision-maker in planning is compounded by an increasingly dynamic and uncertain environment. Organizations must be prepared to adapt even more to the influence of external forces. Most environments are dynamic and, consequently, rich in possible opportunities as well as possible threats to the organization. Therefore, the planner and policy maker cannot analyze the condition of the future environment by assuming that it will remain in a readily predictable state (i.e., in an orderly and incremental progression into the future). Three factors contribute to this sense of uncertainty:

(a) a lack of information about environmental factors that would influence a given decision-making situation;

(b) a lack of knowledge about the effects of an incorrect decision; and

(c) the inability of the decision-maker to assess the probability that a given environmental factor will affect the success (or failure) of the organization or one of its subsystems in fulfilling its mission.

Three step planning process will improve your planning in uncertain environment that will set the stage for improved results

Strengthen your Organisation focus and processes without increasing costs

There are several areas that I consider Organisation's responsibility that are often short-changed when times are good. Extra time spent on understanding your customers and potential customers and how you communicate with them are excellent ways to maximize your business during tough times.

Deliver Exceptional Customer service

Tighten your target focus

Leverage your referral network

Expand your reach using effective, low-cost, electronic communication

Add value and capacity to your infrastructure

There is no reason for your business to stop improving during this period. I often work with clients to make sure that their infrastructure is ready to accommodate growth. This work is usually done with and by vital employees who are often too busy to take care of the capacity and efficiencies available in their own areas.

Search for ways to become more operationally efficient

Capture intellectual property that will continue to add value for years to come.

Build your management cohesiveness and sense of team.

Insist on fact based analysis and decision processes. Get them training on analytical tools and processes.

Lead through the crisis not to the crisis

None of us can predict the future but what we all know is that it is important to give your employees the confidence that they need to stay productive and focused on the opportunities this time provides for them. Your role as a leader is to keep them motivated and contributing.

Focus on maintaining high levels of morale. Find the silver linings and communicate them to your employees.

A Gallup poll reports that 50-70% of your employees look to you for cues on the organization's climate; your attitude and behavior is infectious: be positive, and your company will follow.

People do their best in a positive state of mind: optimists have higher sales levels and lower turnover.

Look beyond the crisis to a better day - Consider acquisitions of timid competitors

Set realistic expectations for everyone. Give all employees goals that they can reach.

Don't be naïve and delay necessary cost savings measures. Prepare for a calendar driven implementation of a cost reduction effort. Be prepared to "Blast" your organization - Build the business from the ground up as if you were just launching the business - Be discreet but include key employees.

Why planning process in dynamic and uncertain environment should be different in Stable environment?

Answer is very simple, because in more stable and predictable environment possibility of long range planning is there; whereas in uncertain environment planning needs to be of short time and managers need to be very aware and vigilant to environment inside and outside the organization. In uncertain environment rules, regulations and policies fluctuate too much so ultimately organization has to adapt itself to environment. Planning implies that the approach is more short-term, and possibly reactive to a current situation. This process assumes that some aspects of the organization do not require intervention and seeks to find the problem areas that need improvement. Often this occurs when the environment is unstable and relatively unpredictable.

Posted By: Aamish Waqas (amsh)