Top - down and bottom- up planning -Virutha
COLLAPSE
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Top-down planning
Top-down planning is referred to as strategy in which business decisions are established at senior level or top management and employees are expected to fall into place and follow the commands and instructions.Top-down project planning is focused on laying out specific expectations for the employees seeking guidance or advice and instructions. As employees are not included in any of the decision making process. They are mostly motivated through either fear or incentives. Positive implications * Employees Know Their Roles - Employees know their roles and follow specific methodology. In a business which requires exacting steps, top-down planning can provide a good fit to management and those employees who enjoy being directed and want to know their everyday task. * Levels the performance Field - A very minimal sense of competition among the rank- and –file. As management possess the highest power of decision making ,each employees will understand that they are in the same boat and coming up with new ideas will not necessarily get anyone ahead. There's no need to worry about being upstaged by a particularly ingenious colleague. * Easy to evaluate - Top down planning begins board, becomes more specific and easy to evaluate as move down to hierarchy * Faster Process - The top-down approach is less time-intensive, save lots of energy as it only higher management is evolved in decision making. Top-down budgeting is much more time-efficient than bottom-up budgeting. * Accountability of Staff - The employees are given certain budget to work with, and they are expected to make prudent financial decisions to allocate their budget. This may result in greater financial accountability. The organization realizes a focused use of resources from the individual managed application.
Challenges associated with top down planning
Inaccurate Forecasting is one the major challenge associated with top down planning.
“Theoretically, department heads have a better understanding of the financial needs of their departments than upper management. Creating a budget without the input of key personnel from the rank and file can result in underfunding or over funding of a department.” (McQuerrey, 2012)
Loss of Prospective and creative work force is also other challenge associated with top down planning. Most of the companies engage in top down planning are going to retain employees who are looking for an eight-hour shift that demands nothing more than the ability to follow directions. Employees who work with creative instinct and like to do something new with their work, will have to look elsewhere for a position that better recognizes their creative abilities
Another challenge would be Influencing the morale of employees. It is kind of demoralizing for employees who are naturally innovative or wish to have an emotional and intellectual stake in their jobs. Bosses who use top-down planning never have the opportunity to see the level of talent that exists within their workforce. Top-down management often results in reduced productivity.
Bottom-Up Planning
Bottom-up planning is approach where lower management people are involved in decision making process. With bottom-up planning, is more focused, as u have large number of employees with their expertise giving their input along with their work during each stage of the process and then pass it to next higher level. Economic conditions that encourages bottom-up planning
In today’s age market are more diversified and has higher competition, thus bottom up planning is specified to give right product, at right time, to right market. The growing emphasis on multi sector collaboration has occurred in diverse issue areas such as policing (Skogan & Hartnett, 1997), economic development (Agranoff & McGuire, 1998) Bottom-up approach can also be most advantageous in order to cope up with the increasing communication gap between the gaps within the workforce. It bridges this gap by effective and time to time communication at each level by acquiring information and utilizing their knowledge in right manner to avoid any surprise at last moment. Schedules, budgets, and results are transparent. “Thousands of companies, such as Bell Canada, and Yahoo now confirm that bottom-up project management, implemented with the help of Enterprise 2.0 tools, improved their business performance. Some companies created corporate blogs to streamline project communications; others introduced wikis to get their customers’ feedback. Even giants, such as IBM, realize the benefits of allowing contributors to have a more active hand in how collaborative work is organized.” (Dana,2010). Reference * Connell, Dana D. (2013). A Buyer’s life. A concise guide to retail planning and forecasting. Chicago: Fairchild Books. * Sparks, D. (2010). The Advantages & Disadvantages of Top-Down Planning.Retrieved by: http://small business.chron.com/advantages-disadvantages-top down-planning-21385.html * Filey, A. (2008).Top-down and Bottom-up Project Management: Leveraging the Advantages of the Two Approaches. Retrieved from https://www.wrike.com/blog/top-down-and-bottom-up-project-management-leveraging-the-advantages-of-the-two-approaches/ * McQuerrey, L.(2012).The Advantages and Disadvantages of Top-Down Budgeting Lisa McQuerrey. Retrieved from: http://www.ehow.com/info_12031520_advantages-disadvantages-topdown-budgeting.html
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