The design of computer based planning and modeling systems

Today there are nearly 2000 corporations in North America and Europe either using, developing, or experimenting with some form of corporate planning model. With the emergence of this new and rather substantial interest in the methodology of corporate planning modeling, there appears to be a definite need for a conceptual framework which can be used to design and implement computer based planning and modeling systems.In this paper the authors describe a collection of elements which they believe to be of critical importance in designing a corporate planning model. Their objective is to develop a set of criteria for not only designing a planning and modeling system, but a set of criteria which can also be used to facilitate the evaluation and comparison of alternative planning and modeling systems.There are over 50 planning and modeling software packages on the market today. These include systems such as BUDPLAN, COMOS and SIMPLAN. This paper attempts to provide the reader with a convenient checklist of possible features to consider in either designing one's own system or selecting an appropriate software package.     

Corporate planning at Dunlop

It has often been said that corporate planning is an art which, like all art perhaps, means all things to all men. As other papers have attempted to do this approaches the concepts of corporate planning in an analytical manner and illuminates a number of approaches which the author considers to be preferable. The problems of corporate planning in Dunlop Limited are then analysed and the author's own experience of corporate planning in that company are utilized describing a practical and comprehensive system.     

Corporate planning in medium-sized companies in the U.K.

The past decade has seen the publication of a considerable amount of research into the corporate planning practices of industrial giants. More recent work has investigated corporate planning practice in small businesses. However, little attention appears to have been paid to actual practice in medium-sized companies. This article reports the results of a study designed to investigate corporate planning practice in medium-sized companies in the U.K. The results show that while corporate planning is widespread among medium-sized companies, it is not the well-balanced and integrated system envisaged in the literature. Also, the majority of chief executives are not truly satisfied with corporate planning as practised in their organizations, but are, at the same time, largely unable to suggest changes to make corporate planning more effective. This points clearly to a need for action by researchers and consultants in the area.     

Formal planning in major U.S. corporations

As the world about us changes, managers in all types of institutions try to cope in a variety of ways. In the early 1960s, many corporate managers realized they could not make sound decisions about future business activities in an expedient, reactive manner because their firms were growing very large and complex with new technologies, products, markets and competition to deal with. As a result, formal planning techniques which had been used in narrow functional applications were introduced on a much broader scale and formal long-range planning became popular. New corporate planning functions appeared in many companies, as well as new staff planning specialists and planning executives. The author conducted a field study on the design of these systems in the mid-1960s and he argues that they showed great promise for improved management.With this history in mind, we might ask why such subjects as ‘planning techniques’ and ‘problems of implementation’ are still topics of concern. It would seem that such techniques would be well known and established in most firms after 10–15 years. However, this is not the case, for during a second field study of corporate planning systems which was completed in 1976 the author found that many corporations, including some of the largest ones, had redesigned their planning systems in the early 1970s, essentially making a fresh start at formal long-range planning. (See Table 1).From his recent field study the author concludes that all corporations experience problems in implementing and using a formal planning system. The nature of these problems and some possible remedies are the subjects upon which this article focuses.     

Corporate planning—A systems view

This paper examines the, often disregarded, fact that the very inprecision of language often obscures basic underlying conceptual differences between corporate planning as expressed in theory and in practice. Few of the claims that confusions result both from a lack of explicit definitions and from the lack of differentiation between ‘theories of planning’ and ‘theories in planning’.

The purpose of this paper is to propose such a theory of corporate planning through discussion of the following topics: (1) Problems in concepts of corporate planning; (2) The concept of an approach of corporate planning; (3) Propositions that form the basis of a theory or model of planning, relying heavily on a systems framework; and (4) a proposed corporate planning system.     

Corporate planning as a control system in United Kingdom nationalized industries

Since the late 1960s some U.K. nationalized industries have undertaken corporate planning as a means of exercising control. In the early 1970s, the U.K. Government, on the advice of one of its select committees, required that all U.K. nationalized industries undertake corporate planning. This requirement has been reinforced through a White Paper in 1978, in which the government reiterated that it saw corporate planning as a major instrument of control both for the nationalized industries themselves, and also for government in its relationships with the industries.This paper examines the development of corporate planning in nationalized industries. The findings are based on research carried out since 1976 in which discussions have taken place with corporate planners in most of the major U.K. nationalized industries. The method followed was to send planners a structured questionnaire covering the field of enquiry, and to follow this by an interview (or interviews) at a high level which would allow further discussion, particularly on the issues seen as important to the organization. The questionnaire was subsequently completed in consultation with the people concerned.     

Corporate planning— A personal viewpoint

The theme running through this article is a plea for realism in the preparation of corporate plans. The author outlines his views on corporate planning: the steps taken by the Greater London Council to introduce corporate planning supported by a programme budgeting system are described, and a summary is given of how the planning process operates.

The effect of the current industrial, financial and economic difficulties on corporate plans is discussed, and a note of warning sounded about the utility under present circumstances of corporate planning.     

Corporate planning a review of questions and answers

This paper is about corporate planning, seen primarily but not exclusively from the viewpoint of operational research. The reasons for the rise of interest in corporate planning are examined, as are the contributions which O.R. has made or can make to corporate planning problems. An abstract discussion of these problems concentrates on those posed by increasing “connectedness” in the environment. After comparing the responses of the “commonsense manager”, the model-oriented operational researcher, and the cybernetician, the question is posed: “How can the operational researcher or planner enhance the adaptive capability of his organization?” A case study illustrates one possible form of solution, the “modular” approach; and another, the “zoom-lens” is outlined. The relevance of global system modelling to the widening problems of the corporate planner is also considered, and related to the concepts previously discussed.     

Setting corporate objectives using market required earnings

This paper examines and illustrates a new approach to corporate planning. The authors provide a framework which can overcome some of the more pernicious effects of long term corporate planning such as the gearing of the more fundamental commercial goals. The authors produce a rigorous framework as to the criteria upon which a corporate strategy should be based and then tested their model against the corporate planning activities of several large companies whose profitability rates were relatively high. Finally, the paper analyses the optimal method of utilizing the proposed model.     

Behavioral aspects of corporate planning

Most models of corporate planning neglect to include behavioral variables. This is unfortunate, as human behavior is typically the most dynamic component of any planning system. Should behavioral variables be overlooked, due to their difficult measurability, or for other reasons, the planning system will inevitably prove deficient in terms of predictability and control. Accounting for human resources and other behavioral measurements should be routinely included in any corporate planning model. A component of such a system would include the output from a stochastic process model of expected future values of employee services. The theoretical development of such a model is briefly discussed in this paper.     

Elements of effective corporate planning

This paper focuses on several specific areas in corporate planning which heretofore have received limited attention in the literature. These areas include perception of a need for planning, analysis of planning from a process viewpoint with particular emphasis on organizational structure, and elements of effective planning. Data on which conclusions are based were developed through structured in-depth interviews with key planning executives of 14 large corporations in the Pittsburgh Metropolitan area.The study determined that the most prevalent event associated with perception of a need for more formalized planning was a change in top management. The emphasis on planning usually arose from three sets of factors—organizational, external, and performance. The typical planning process involves establishing corporate goals and objectives, setting environmental premises, collecting information and forecasting, establishing divisional goals and objectives, developing divisional plans, and revising objectives and plans if objectives are not met. The major participants in the planning process are top management, the corporate planning department, divisional general management, divisional staff groups, and intermediary planning groups.The study identified necessary conditions for effective planning which included planning knowledge and skills, planning climate, psychological commitment, and effective group behavior. The study also includes a discussion of planning weaknesses, current trends, and recommendations.     

Survival of the corporate planner

Like most businesses, corporate planning units come and go. Based on a survey of 105 coporate planning units in the U.K., this article presents those factors, both external and internal to such units, which appear to have most influence on the creation, survival and success of corporate planning units.     

Strategies for planning

In recent years there has been a good deal of discussion amongst planning specialists and academics about the gap which exists between the theory of planning as set out in journals and textbooks, and the practice of planning in private and public organizations. Planners are continually complaining about the resistance to planning by top management and operating managers in divisions and departments.In this article the author aims to produce a reconciliation between theory and practice and to discuss what alternative strategies are open to planners in devising planning systems for their organizations.He suggests that the problem has its origin in the fact that corporate planning theory was first developed by management scientists as a total systems approach. Corporate planners have failed to sell an integrated planning system either as programme budgeting or as corporate planning. Research suggests that a management team can only adopt and implement a comprehensive planning system in very special circumstances, e.g. when the organization's survival is threatened, a new management team has been appointed and the staff of the organization are ready to accept radical change.In normal circumstances the planner is wrong to advocate a ‘root and branch’ solution. He must diagnose the planning needs of the organization and his objective must be not merely to establish a particular planning procedure but rather to discover how he can best improve the quality of management decisions.Recent studies on strategy formation indicate that the introduction of a formal planning procedure is only a partial answer to the problem of improving the quality of management decisions.The paper reviews various approaches to planning and considers how they relate to organizations with different strategic problems, with differing organization structures and various management styles.     

Strategic Manufacturing Planning Systems and Their Linkage to Planning System Success

Academics and practitioners alike are focusing more attention on manufacturing strategy after having recognized the important role it plays in shaping the success of industrial firms. Even though research in this area has increased in the last decade, the focus of much of that work has been on the content rather than the process of the manufacturing strategy. Consequently, this study attempts to understand the important elements of the strategic manufacturing planning process and its effectiveness. Borrowing from the extant literature in the fields of strategic management and information systems, we propose a research model that relates strategic manufacturing planning system design to planning system success. Using structured questionnaires, empirical data is collected from over 200 manufacturing executives to test the model hypotheses. Planning process in manufacturing was found to be a bottom‐up approach from a corporate or business perspective, which differs from the top‐down planning process prevalent in strategic information systems planning process. Findings also indicate that greater planning system success in manufacturing is associated with a planning system that combines some “rational” elements (formality, comprehensiveness, control focus, longer horizon) with others that lend adaptability (wider participation and more intense interaction). But the strategic manufacturing planning system is more than just a collection of independent planning characteristics. Instead, it can be viewed as a gestalt planning system whereby planning characteristics move together in affecting overall planning system success.     

Corporate prediction markets: a tool for predicting market shares

Prediction markets have been applied for various forecasting issues, such as political events or sports. The ability of these markets to collect distributed information in a fast and efficient way provides useful support for corporate planning. A crucial criterion for the quality of the information aggregation process is the liquidity of the market, especially in corporate prediction markets, which typically consist of fewer traders than public markets. The use of automated market makers is one option with which to ensure enough liquidity, but it is always related to some drawbacks. This paper investigates a field study of a corporate prediction market that replaces the automated market maker with human traders. We analyze the efficiency of such markets, the impact of the applied incentive system and the effects of human market makers.     

Long range planning in large United States Corporations—A survey

This paper presents the results of a survey of the application of strategic and corporate planning in 500 large U.S. Corporations. The authors sought to update and provide new understanding on a number of important issues including; the extent of long range planning in these firms, the organizational structure of their planning function, the prevailing attitude towards long range planning in the firm, the planning process in terms of content and revision frequency, and the perceived benefits and problems associated with long range planning. In concentrating upon these issues the authors provide an interesting and important insight into the current application of strategic and corporate planning processes as well as giving a number of indications as to where the theory lags behind the practice.     

Corporate planning in local government—a case study

The authors set out their view of the peculiar problems facing corporate planners in local government as compared with the private sector and their view of the nature of corporate planning in this special environment. By way of illustration as to how one local authority has attempted to introduce corporate planning, the article includes a case study of the City of Bradford Metropolitan Council.     

Evaluating the benefits of formal planning systems

While empirical studies indicate that formal planning influences corporate effectiveness, no systemic understanding exists regarding how and why formalization of the planning activity affects corporate performance. This article proposes a framework for analyzing the impact of formalization on the quality of the planning exercise.It is suggested that by formalizing the planning activity, certain benefits accrue which cannot result from informal planning. Also, the intrinsic purposes of planning are furthered in several ways by formalization. However, there are also disadvantages resulting from formalization, some inherent and some arising from faulty design. The consequences of formalization with respect to the generally accepted purposes of planning are examined and a checklist intended to help designers develop more effective formal planning systems is proposed.     

Corporate planning and operations research: Do they go together?

Corporate planners in 59 U.S. commercial banks responded to a questionnaire on the use of operations research methods in the planning activities of their bank. Based on the questionnaire responses, 39 of the banks were identified as users of operations research techniques in corporate planning. The 39 banks provided background information on their operations research activities in corporate planning with respect to techniques used, number of persons employed, general organization and overall results. In order to learn more about the performance of operations research planners, comparisons were made between the financial performance of the group of users and the group of non-users in the sample. The results suggest that U.S. banks using operations research methods in corporate planning are larger, but not necessarily more profitable, than other banks in the industry.