Cite this article as:"Contingency Factors Affecting Management Planning," in The Business Professor, updated April 2, 2020, last accessed September 26, 2020, https://thebusinessprofessor.com/lesson/contingency-factors-affecting-management-planning/.
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What Contingency Factors affect the Planning Process?
There are numerous Contingency Factors associated with planning.
- Organizational Level – Most organizations are hierarchical to some extent. In terms of planning, Higher Levels = Increased emphasis on Strategic Planning. Lower Levels = Increased emphasis on Operational Planning.
- Formal vs Informal Planning – Planning Approaches vary based upon the organizational structure. Formal Planning is generally carried out by High-level Managers. The plans flow down the organization. New methods have emerged that vary greatly from the formal planning approach. Two common approaches include: Plans are developed at each level of the organization’s hierarchy, and Means-End Planning. “Means-End Planning” means designing organizational goals that fit into a hierarchy so that the achievement of goals at lower levels permits the attainment of higher‐level goals.
- Environment Uncertainty – Higher levels of organizational uncertainty requires specific but flexible plans. Flatter organizational structures tend to allow for more dynamic planning.
- Length of Commitments – Organizations must plan adequately to account for their current commitments. This includes both short-term and long-term plans. Many organizations will have long-term commitments that require extensive forward planning.
- Level of Specificity – The level of specificity associated with an objective will determine whether plans are very specific in nature or whether they are “Directional” or very general in nature.
- Frequency of Use – How often a plan will be employed is a major concern for planners. Does the potential situation require a single plan for a contingency or does it require a standing plan for routine occurrences?