Bank management and strategic planning for the 1980s

This paper examines a number of important issues facing banking in the 1980s. The authors maintain that banking has been managing primarily by crisis, and this 'simply cannot be the operating norm'. The paper analyses a number of selected issues facing bank management in 1978 and the perceptions of bank managers about those issues vs their probable importance in 1985; furthermore, the paper examines likely operating strategies which will be required as effective responses to emerging environmental realities. Through examining the competitive realities for 1985 this paper, as have many others recently, broadens the context within which planning in banking will perhaps take place in the future.     

How managers plan—the analysis of managers' activities

This paper analyzes the positions of Mintzberg and planning experts on the extent to which managers plan and the importance of planning to management. Mintzberg contends that managers do not plan. The ‘planning literature’ contends that planning leads to effective management. In a replication of Mintzberg's study, the authors found support for the planning literature's position. The discrepancy between Mintzberg and the planning literature is explained by the shortcomings of the observational method used by Mintzberg. A suggested modification of Mintzberg's method is given.     

Strategic planning for research and development

This paper examines the need for and the difficulties in implementing strategies for planning the research and development activities of a company. The author does not accept that research planning reduces creativity, though he is of the view that planning's exclusive concentration on economic aspects of a company's activities, such as turnover or profit, can lead to erroneous decisions in the research and development field. This paper outlines a number of specific and explicit research strategies which can be followed, and relates them to the company's strategic objectives. Furthermore, the author explicitly categorizes different types of research and comments upon the relevance of strategic planning to each.     

Setting operational goals for corporate social responsibility

In this article the author argues that more formality in social responsibility planning efforts is a concept which is extremely pertinent in today's conditions. Rewards will accrue to the organization that can move beyond aesthetic objectives and achieve operationality in social responsibility goal setting. This requires, basically, the application of techniques that have proved to be successful in MBO programs. By translating broadly stated social objectives into goals that are clear, concise, time related and cost related, management will inject an increased measure of integrity into its planning process, improve social responsibility programs, assure future successes in the social performance arena, facilitate the appraisal of management personnel, and enhance the organization's credibility with its multiple publics. Positive benefits will flow to the organization, its immediate publics, and to the society at large as a consequence of operational planning methods as described herein.     

Planning in a state of turbulence

This paper is concerned with an exploration of the role of the long range planner, whether in the private or public sector of the economy, and the impact made upon the processes of his work by government's increasing propensity to manipulate the economy. The authors' researches over the last 2 years into the comparative nature of planning processes in the U.K. economy have made it abundantly clear to them that planners are increasingly concerned at the dangerous potential of such impact upon their forecasting procedures. The emphasis here will rest upon the planner in private enterprises, although the authors' work in both local government and the nationalized enterprises suggest that the problem is of equal importance in these sectors.The authors consider first the past nature of the search processes in long range planning and the context of such attempts to narrow down the range of variables that form the enterprise's perception of its future. Secondly, they examine the emerging discontinuity and the changing role of government, with particular reference to indicative planning concepts. Then they introduce some of the findings of a recent survey of attitudes towards long range planning in the construction industry of the U.K., a sector vitally influenced by turbulence in the economy and with particular interest in government's ideas of macro-planning. Finally Edwards and Harris examine the implications to government and to planners of their findings.     

The dangers of centralized economic planning

There is little evidence that there is much value in riveting attention on the question of strategic planning in an era of low growth or negative growth. Rather, there is value in discussing strategic planning in terms of the efficient realization of society's goals— whether expressed as economic goals or as non-economic aspirations. This article contains some observations on corporate strategic planning, provides perspective on the energy and materials scarcity question, and warns that detailed economic planning by government thwarts the optimal use of resources to improve living conditions for everyone. The author holds that renewed government reliance upon the workings of a competitive market economy is indispensable for achieving this goal.     

A descriptive model of electricity consumption

The purpose of the model is to give corporate planning personnel, particularly ratemakers, or marketing people, a tool to evaluate quickly how many customers are included in a definite block of energy consumption within some limits of power demand. This will allow them to evaluate the number of customers that will be affected by any proposed rate schedules and, then, to evaluate the resulting effects on utility's revenue. Moreover, this model can, in any time, become a part of a larger model that could be used for financial planning, market analysis, or any other econometric model.     

How corporate planning responds to uncertainty

This article is based upon an SSRC research project into the influence of computer methods on decision making. During this research, information on the planning systems of a cross-section of British industry was obtained.The paper illustrates how managers in these firms were coping with planning in the present conditions of extreme uncertainty about the future, combined with adverse economic and business conditions. Conventional planning theory, together with some modern observations on it, are briefly described and then the paper shows how, in the firms visited, the structure of planning was more complex than this theory.It goes on to show that today's critical conditions were not leading to management putting aside their plans and computer models and “muddling through’. They were actually leading to an acceleration in the adoption of formal planning and decision making methods but in a somewhat different manner to conventional planning theory.Seven different modes of planning were identified with integrated operational planning being the most common, possibly the most essential to survival and sometimes the only planning possible into today's conditions. A trend to extend the operational plan to 2 to 3 years and to reduce the firm's long range plan from 5 to 3 years was also observed.Long range plans were being considered as planning and decision making tools and not as blue-prints of the firm's future, as accurate long range forecasting was impossible. Three types of strategic planning were identified with that carried out at intervals probably being the most appropriate for medium sized firms in today's conditions.     

Decisions,judgement and style

This paper, one of a series which have already appeared in previous issues, focuses on the role of people, their judgments and their styles in the process of making and taking decisions concerning the future; that future and the decisions which will shape it being part of the complex strategic planning process. The author does not deal with decision analysis but concentrates his analysis upon the delicate balance which is maintained between what Sir Geoffrey Vickers calls ‘the art of judgement’ and the quantifiable elements of decision. The author rightly makes a distinction between decision-making: and decision-taking: this distinction accurately mirrors the long and often complex consultation process which occurs in almost all organizations before a decision is actually taken. The author's analysis concentrates upon the important effect which ‘judgement styles’ can have upon an organization and its planning process. Indeed, this paper suggests quite positively that judgment styles have an important and indeed crucial effect upon the view of the future which an organization will regard as preferable as well as influencing the manner in which the planning process will operate.     

What kind of corporate planner do you need?

The planning literature ignores distinctions among types of plans and types of planners. Consequently, a systematic pairing of planners and a company's level of planning need is not well understood or implemented in practice. This paper provides two missing links in order to bridge this shortfall between theory and practice. One is a planning matrix which establishes six possible planning modes for a company based on its stage of development and management style. The second is a distinction between three types of planners who would be appropriate to each planning mode. The matrix plus the three categories of planners provides a new tool for management in its responsibility for planning the job of the corporate planner. In doing so, it also surfaces some underlying causes of organizational strain and stress associated with the corporate planner's position.     

Regression models of behavior for managerial decision making

A principal problem in systems studies concerns the development of models that will be accepted and used by decision makers in organizations. Regression models derived from managers' past behavior offer promise in overcoming this problem for many repetitive types of decisions. Employing a simulated production planning environment, this paper discusses both the potential usefulness and limitations of such models for understanding and improving decision making in practical applications.     

The strategic divestment decision

Management, periodicals have of late been reflecting the increasing attention corporate managers are paying to the difficult problem of divestment. The purpose of this paper is to outline conceptually a planning and analytical framework for dealing with divestments.Corporate Planners in manufacturing organizations will find particular relevance in the author's comments.     

Strategic planning could improve your share price

From a financial point of view the long-term ultimate goal of the firm is to maximize its stock price. A high P/E multiple keeps existing stockholders satisfied, reduces the chances that a corporate pirate will attempt to raid the company, and also facilitates the company's own acquisitions.Therefore, financial managers are especially interested in answers to the questions of if and how strategic planning can help to improve the price-earnings multiple. The results of the study summarized in this article answer the first question in the affirmative and give at least a partial answer to the second. Contrary to the conclusion of some other recent studies, this study finds a definite long-term financial payoff from strategic planning. Furthermore, it suggests that strategic planning may be more effective if it is conducted at the corporate rather than solely at the division level.If maximization of stock price is a corporate goal, delegation of strategic planning entirely to the division level may result in a high cost to stockholders.     

Conflicts between public and private opinion

The opportunities for research in the 1980s will be much affected by changes in society. In particular, by a clash between two powerful forces—the producer bureaucracy and the new individualism. It will be a clash of values and opinions; and research will be needed to measure them.However, there are dangers in the way that opinion research will be used, and especially in the way that it will be publicized. The protagonists in the arguments on many social issues are likely to make increasing use of published ‘research events’— that is, over-simplified and superficial figures on public opinion, designed mainly to appeal to the media's need for simple and dramatic news, and thence to affect public policies.In fact, the evidence is very strong that there is a genuine difference between people's private opinions and their public opinions. But the requirements of media contests will tend to force research methods to concentrate heavily on public opinions. The danger is not so much that this would distort social policies (though it might) as that it could damage the reputation of market research in general—especially if, as is likely, the findings of one group's ‘research events’ appeared to be directly opposed to those of another's.One important challenge of the 1980s will be to identify these risks and do something to guard against them. Five simple guidelines are suggested which I hope can contribute to a joint campaign to educate in the proper use and presentation of opinion research.     

Strategic planning for commodities and specialties: A strategic industry study based on the example of the chemical industry

The objective of this paper is to identify general factors which are important to successful corporate strategic planning and to provide guidelines to requirements for successful entry into the specialty materials/products business. The study is based on the author's experience in the highly specialized Swiss chemical industry. While the concept of commodities/ specialties has been developed most intensively in the chemical industry, it has overall validity for all industries and services and the author gives many practical hints on strategic management.     

Designing an ADP planning process

A great deal has been written about the frustrations of carrying out long range planning in large organizations. Although far less has been written about ADP planning, similar frustrations (as well as benefits) have been suggested.The case study described in this article deals with the recent experiences of a large, federal regulatory agency— the Food and Drug Administration—in the design and implementation of an ADP planning process from 1974 to the present. Although the process was designed to meet the Agency's specific needs, many of the lessons learned will be useful to others contemplating a process for their organization (public or private).     

Information for more effective strategic planning

This paper illustrates how an entity—called a ‘strategic data base’ (SDB)—can be developed to provide important information in a form which makes it directly useful in various phases of a strategic planning process. The strategic data bases are concise statements of the organizational and environmental situations which define the organization's most salient problems, opportunities, and constraints. These SDBs may be developed through a participative process involving tasks forces which are made up of managers representing the diverse interests of the organization. The strategic data bases thereby become important informational inputs to planning which can directly serve to enhance the quality of planning decisions. Moreover, the process of developing SDBs can be an important learning device for those middle managers who can become involved in such a process at a much earlier point in their career than that at which they might normally engage substantively in the organization's overall strategic choice process.     

Corporate planning—a conceptual critique

Corporate planning is accepted by some as being an effective, efficient, and feasible means of charting the path an enterprise takes through the future. In this paper the author questions both the concept and the contribution of corporate planning. The author examines not only the problem of budgetary analysis within a planning process but also questions the ability of corporate planning to provide the necessary perspective of the future in any identifiable or probabilistic sense. The author postulates ‘the guts of corporate planning’. In the author's own word conceptual critiques ‘may be defined as setting up your own straw man in place of the other fellow's sawdust totem’. However, this paper presents some controversial yet fundamental criticisms of the current concepts of corporate planning. It is for the reader to judge whether the straw or the sawdust is deepest.