High Output Management by Andrew S. Grove

Author:Andrew S. Grove [Grove, Andrew S.]
Language: eng
Format: epub
ISBN: 9780679762881
Publisher: Knopf Doubleday Publishing Group
Published: 2015-11-18T05:00:00+00:00

6

Planning: Today’s Actions for Tomorrow’s Output

The Planning Process

Most people think “planning” is one of the loftier responsibilities of management—we all learned somewhere that “a manager plans, organizes, controls.” In fact, planning is an ordinary everyday activity; it’s something all of us do all the time with no fanfare, in both our personal and professional lives. For instance, as you’re driving to work in the morning, you are likely to decide whether or not you need gasoline. You look at the gauge to see how much gas you have in the tank, you estimate how far it is you need to go, and you then make a rough guess as to how much gas you need to get to and from your office. By comparing in your mind the gas you need with the gas you have, you decide whether you should stop for gas or not. This is a simple example of planning.

The dynamics of planning can best be understood by going back to our basic production principles. As we learned in Chapter 2, the key method of controlling the future output of a factory is through the use of a system of forecasting demand and building to forecast. We operated our factory to fill existing and anticipated orders. Our job was to match the factory’s output at a given time with the orders for it. If the projected output did not match the projected market demand, either we made additional production starts or we reduced them to eliminate the excess. How one plans at the factory can then be summarized as follows: step 1, determine the market demand for product; step 2, establish what the factory will produce if no adjustment is made; and step 3, reconcile the projected factory output with the projected market demand by adjusting the production schedule.

Your general planning process should consist of analogous thinking. Step 1 is to establish projected need or demand: What will the environment demand from you, your business, or your organization? Step 2 is to establish your present status: What are you producing now? What will you be producing as your projects in the pipeline are completed? Put another way, where will your business be if you do nothing different from what you are now doing? Step 3 is to compare and reconcile steps 1 and 2. Namely, what more (or less) do you need to do to produce what your environment will demand?

Let’s consider each step in more detail.

STEP 1—ENVIRONMENTAL DEMAND

Just what is your environment? If you look at your own group within an organization as if it were a stand-alone company, you see that your environment is made up of other such groups that directly influence what you do. For example, if you were the manager of the company’s mailroom, your environment would consist of customers who need your services (the rest of the company), vendors who are able to provide you with certain capabilities (postage meters, mail carts), and finally, your competitors. You don’t, of course, have

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