Planning POM unit-2 BBA
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Transcript of Planning POM unit-2 BBA
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UNIT 2
PLANNING
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Nature and process of planningIntellectual process - deciding in advance what needs to
be done based upon collection, study and analysis of facts. Selection of best alternative from available ones.
Primary function – it is a primary activity to other managerial functions of organizing, staffing, directing, motivating, coordinating, communicating and controlling.
Focus on goals – plans begin with goal setting, developing policies, procedures and strategies to achieve the goals.
Pervasive – it spreads across all management levels i.e. top come up with strategic plans, middle with operational plans and lower with basic team level plans.
Decision making – plans target goals and decision making guides as to which plans to choose from to achieve goals.
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Nature and process of planning• Flexible – it should be able to adapt to the
changing business environment.• Continuous process – plans are always
changing and being revised as per the changing environment.
• Future oriented – plans forecast future requirements as per demands.
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Types of PlansStanding Plans:These are used for a long time period over and over
again for issues that occur again and again.They include;Objectives – business goals and related goals at all
levels of the organization.Two approaches to setting objectives;Traditional – here goals are set at top level for those
at low level. But this approach is more authoritative and fails to motivate employees.
Modern (Management By Objective) MBO – here organizational objective is converted into a personal objective of the employee which leads to better performance by the employee.
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Types of PlansPolicies – they lay down broad limits for executive
action.Kinds of policies are;Originated – made by managers guide subordinates
how to act in a given situation.External/imposed - when government imposes a
condition that certain percent of profit has to used for CSR.
Functional – meant for different functions like financial policy, marketing policy, production policy etc.
Policies at different levels – basic policies used by top managers, general policies used by middle managers and departmental policies used by departmental managers.
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Types of PlansProcedures – steps for performing activities.Methods – they provide details about a
particular operation to be carried out. Rules – to operate in a particular way rules are
made. They are used to control all the operations and resources of the organization.
Strategies – an action plan which sets the direction or future course of action the organization will take or the way in which it will go.
Types of strategies;
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Types of PlansMaster – to enter a new market with the objective of
getting a 15% market share.Program – to achieve master strategy extensive
advertising and selling strategies would be framed.Minor/sub-strategies – to capture market an
advertising agency would be appointed as a minor strategy.
Benefits of standing plans:Efficiency – routine decisions are promptly taken
using these plans.Delegation of authority – this is done through well laid
down rules and procedures. Strategy and methods help employees take fast decisions.
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Types of PlansControl – methods and procedures are
designed to bring about control to the operational activities of the organization.
Co-ordination – the efforts of every individual in the organization are blended with each other through methods, policies and procedures. But standing plans prevent innovation and increases resistance to change.
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Types of PlansSingle Use Plans:They are used only in specific situation for taking
care of specific matters.Types of such plans are;Program – program for increasing sales by 20%
would require number of small plans to be formed.
It is a laid down course of action to achieve goals.Budget – it is a monetary/quantitative expression
of business plans.Types of budgets;
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Types of PlansAccording to time:Long term budget – for long term planning of
business by the top management.Short term budget – meant for one or two years Current budgets – these are for weeks or
months.
According to functions:Functional/subsidiary budgets – these are
related to different functions like sales, purchase, cash and finance.
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Types of PlansMaster budget – various functional budgets
are integrated into a master budget.
According to flexibility :Fixed budget – they are prepared for a given
level of activity and it never changes.Flexible budget – they consists of series of
budgets for different levels of activity.