Always begin with the end in mind. Planning must visualize tomorrow, how it would look like, feel like, smell like, touch like, taste like, hear like. The clearer the picture we have of tomorrow, the more we know what we have to do today. The more exact the measures of tomorrow that you set, the more you can actually manage your resources and your concentration of time, effort and money. If you cannot measure it, you cannot really manage it. The performance outcomes or end results are what we call performance indicators.
The clearer the picture we have of tomorrow, the more we know what we have to do today.
There are many things you do to achieve an outcome but they are not yet, in the strict sense, final performance indicators. Sales become performance. The profits generated from those sales become performance. Everything else was a means, a strategy, a way of getting to the end result or outcome desired. You monitor the means. You monitor whether your people are carrying out the chosen strategies. But you evaluate the end results or performance outcomes.
This vision is a futuristic picture of the enterprise, described in words or a vision statement. It Is time bound, ambitious but realistic and focused that would enable the entrepreneur to plan strategically. Next, the entrepreneur developed a mission statement, which essentially proclaimed the basic purpose for being of the organization. As a business organization, the basic purpose cannot really stray away very much from wanting to earn a decent return on one's investment and carving a sizeable slice of the market. Next, the enterprise translates the broad vision and mission statements to specific objectives.
This vision is a futuristic picture of the enterprise... time bound, ambitious but realistic and focused that would enable the entrepreneur to plan strategically
Objectives are measurable end results and, for business organizations, usually center around four major ends: increasing profits; expanding markets; satisfying customers with quality products or services; and providing reasonable compensation and benefits to employees. The attainment of these objectives or measurable end results could be described and measured by Key Result Areas (KRAs). KRAs are manifestations or proofs that the objectives are being achieved. For each objective, there could be one or several KRAs. The Key Result Areas or KRAs are qualitative manifestations that the objectives are being attained. These KRAs must be converted into numerical Performance Indicators or PIs. PIs are nothing but exact quantifications of the KRAs.
From the creation of a vision to the establishment of concrete performance indicators, the first half of the right to left planning exercise has been completed. The second half of the right to left planning exercise starts at the performance indicators. The planning process calls for the generation of major alternatives, also known as strategic options, for attaining each and all of the performance indicators. Each strategic option is converted into action programs. The next stage of the process was to bring the action program down to specific activities and tasks.
Once all the activities and tasks are properly lined up, the last stage of the process is to determine what resources are required to carry out the strategy, action program, activities and tasks. The resources required are made up of people, pesos (money) and physical facilities or the three Ps of resource budgeting. This completes the right to left planning exercise.
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