2. PLANNING
WHAT IS PLANNING?
•Determination of future course of actions in advance
•It is the blue print of action and operation.
•Planning is basic or primary function of management.
•Planning is mental exercise and intellectual process.
•Thinking before doing is planning.
•Planning is the process of bridging the gap between where we
are and where we want to be in the future.
3. PLANNING
WHY IS PLANNING IMPORTANT TO MANAGERS?
•To determine new opportunities
•To anticipate and avoid future problems
•To develop effective courses of action (strategies and tactics)
•To comprehend the uncertainties and risks with various
options.
•To set standards
4. PLANNING
DEFINITION
“Planning is deciding in advance what to do, how to do, when
to do and who is to do it. Planning bridges a gap between from
where we are to where we want to go”
-Harold, Koontz and O’Donnell
“Generally speaking, planning is deciding in advance what is
to be done”
-W H Newman
“Planning is that function of manner in which he decides in
advance what he will do. It is a decision making process of a
special kind, its essence is futurity.”
-Hayness and Massie
5. PLANNING
IMPORTANCE OF PLANNING
•Planning helps to set the objectives.
•Planning helps to avoid the uncertainty and risk.
•Planning helps in coordination.
•Planning helps to make the control effective.
•Planning helps to run the organization effectively.
•Planning helps to minimize waste and redundancy.
6. PLANNING
CHARACTERISTICS OF PLANNING
•Planning is goal- oriented
•Planning is an intellectual or rational process
•Planning is a primary function
•Planning all pervasive
•Planning is forward looking
•Planning is a perpetual process
•Planning is an integrated process
•Planning involves choice
7. PLANNING
TYPES OF PLANNING
Strategic planning
•Strategic goals are broad goals of where the organization wants to be in
the future. These goals pertain to the whole organization.
•Indicates recourse allocation and priorities.
•It involves SWOT Analysis.
•Generally developed by top management.
•Long- term in nature.
•Uncertain environment.
•Large amount of information is required.
8. PLANNING
TYPES OF PLANNING
Tactical planning
•Aims at achieving tactical or short-term goals.
•Support the implementation of strategic plans.
•Developed by middle-level managers.
•Actual getting the things done.
•Less risky .
•Information can be derived from internal sources.
9. PLANNING
TYPES OF PLANNING
Operational planning
•Steps for achieving tactical plans.
•Specific, quantitative terms and for day-to-day operations.
•Developed by lower-level managers.
•Time frame is less than a year.
•Certain environment.
•Operational goals are necessary for the success of tactical and strategic
plans.
10. PLANNING
TYPES OF PLANNING
Contingency planning
•Alternative course of action.
•Plans that define company responses to specific situations, for example
emergencies or unexpected conditions.
•Implemented if and when an original plan fails to produce the
anticipated result.
•Allow a manager to be flexible and change-savvy.
•Might seem like extra work, but much like a reserve parachute when
skydiving.
11. PLANNING
TYPES OF PLANNING
Proactive planning
•Designing suitable courses of action in anticipation of likely changes in
the relevant environment.
•Organization do not wait for the environment to change but take action
in advance.
Reactive planning
•Organizations responses come after the environmental changes have
taken place.
•In such situation the organization lose opportunities to those
organization which adopt proactive approach
12. PLANNING
TYPES OF PLANNING
Based on frequency of use
Single use plans
•Plans for attaining a one-time organizational goal.
•Single use plans are relevant for a specified time and after the lapse of
that time, these plans are formulated again for the next period
•Examples: projects, budgets, programs.
13. PLANNING
TYPES OF PLANNING
•Budgets :
The expected results of a given future period in numerical terms.
It quantifies the plans and established for actual operation.
•Projects :
It helps in the precise allocation of duties and effective control
and easy implementation of plans.
•Programs :
Large scale single-use plans that coordinates a complex set of
activities to achieve important non- recurring goals.
14. PLANNING
TYPES OF PLANNING
Standing plans
•Standing plans are ongoing plans that are used to provide guidance for
tasks performed repeatedly within an organization.
•Policies :
It specifies the broad parameters.
•Procedures :
It is a chronological sequence of steps to be undertaken to achieve an
objective.
•Rules :
A rule is a statement that spells out what should or should not be
done in a particular situation.
15. PLANNING
TYPES OF PLANNING
Based on time frame
Long-Term Plans
•Plans with time frames extending beyond three years
•The long term plans usually encompass all the functional areas of the
business and are affected within the existing and long-term framework of
economic, social and technological factors.
16. PLANNING
TYPES OF PLANNING
Short-Term Plans
•Plans with time frames on one year or less
•These are aimed at sustaining organization in its production and
distribution of current products or services to the existing markets.
•These plans directly affect functional groups( production, marketing,
finance)
17. PLANNING
PREMISES OF PLANNING
•“Planning premises are the anticipated environment in which plans are
expected to operate. They include assumptions or forecast of the future
and known conditions that will affect the operation of plan.”
•Types of planning premises.
-External premises
-Internal premises
-Controllable and uncontrollable premises.
-Tangible and intangible premises
18. PLANNING
PREMISES OF PLANNING
External premises
•External premise create threat or opportunity to the organization.
•As the organization is an open system it is affected by the external factors
such as
-Economic factors ( fiscal policy, budget etc)
-Political-legal factors ( laws, political interference )
-Technological factors ( sources of tech, new tech)
-International factors ( subsidies, duties)
-Competitive factors ( price, positioning of comp)
19. PLANNING
PREMISES OF PLANNING
Internal premises
•Internal premises create strength or weakness for organization
•Various departments in the organization like productions/operations,
marketing, finance, human resources department if working effectively
and efficiently in coordination creates strength for organization.
Tangible And Intangible Premises
•Tangible premises are quantifiable like labor hour, man hours, monetary
units etc
•Intangible are qualitative in nature and cannot be translated into quantity.
E.g. image of company
20. PLANNING
PREMISES OF PLANNING
Controllable and uncontrollable premises
•Controllable premises are which can be controlled by the organization.
They are internal to organization. like structure, policies, procedures,
strategies.
•Uncontrollable premises are which can be controlled by the organization.
They are external to the organization. like taxation policy, rate of
economic growth, inflation rate.
•Semi-controllable are which can be controlled to some extent but not
wholly. like market share, labor turnover, product price, labor efficiency.
21. PLANNING
PROCESS OF PLANNING
Establish
objectives Develop Strategies
Determination of
premises
Determination of
alternatives
Evaluation of
alternatives
Selecting a
course of action
Formulation of
derivative plans
Implementation
of plans
Reviewing the
planning process
Analysis
22. PLANNING
PROCESS OF PLANNING
Analysis
•Essential to make a successful plan.
•SWOT analysis.
Establish objectives
•Objectives must be specific, clear and practical.
•They should be time bound and expressed in numerical terms.
Develop Strategies
• Constructing possible courses of action that will lead you to goal.
23. PLANNING
PROCESS OF PLANNING
Determination of premises
•Premises are the assumptions about the future in which the planning is
implemented.
•They provide environment and boundaries for the implementation of
plan in practical operation.
Determination of alternatives
•It is essential to identify all the possible hidden alternatives.
•There must be search for the best alternative.
•The management must develop alternatives through the support of
experienced and intellectual experts in management sectors.
24. PLANNING
PROCESS OF PLANNING
Evaluation of alternatives
•Evaluate the alternatives from their expected cost and benefits. This is
the logical step to evaluate each alternative from its plus and minus
points.
•Each alternative is studied and evaluated in terms of some common
factors such as risk, responsibility, planning premises, resources,
technology etc.
Selecting a course of action
•Selecting the course of action that has the most advantages and the
fewest serious disadvantages.
25. PLANNING
PROCESS OF PLANNING
Formulation of derivative plans
•Derivative plans involve formulation of policies, rules, schedule and
budget to complete defined objectives.
•It is difficult to implement main plan without formulation of derivative
plan.
Implementation of plans
•This step brings all the procedure of plan into action.
•Determine, who will be involved, what resources will be assigned how
the plan will be evaluated, and reporting procedures.
26. PLANNING
PROCESS OF PLANNING
Reviewing the planning process
•Making certain that the plan is going according to expectations and
making necessary adjustments.
27. PLANNING
PRINCIPLES OF PLANNING
•Principle of Contribution
•Principle of Sound and Consistent Premising
•Principle of Limiting factors
•Principle of Commitment
•Principle of Coordinated Planning
•Principle of Timing
•Principle of Efficiency
•Principle of Flexibility
•Principle of Navigational Change
•Principle of Acceptance
28. PLANNING
ADVANTAGES
•Planning helps in future change.
•Planning helps to set up the standard for organization.
•Planning says the proper utilization of resources.
•Planning helps to win over competitors and rivals.
