Presentation On Planning

8/12/2019 Presentation On Planning

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What is Planning? Planning is a rational action mixed with a little of forethought. It is seen

everywhere. In a business, planning is the primary of all managerial functions asit involves deciding of future course of action. Thus, planning logically precedesthe execution of all managerial functions. Planning is the process of deciding in

advance what is to be done, where, how and by whom it is to be done.

Thus, it is basically a process of thinking before doing. All these elements speakabout the futurity of an action.

Koontz and ODonnell have defined planning in terms of future course ofaction. They state that Planning is the selection among alternatives for future

courses of action for the enterprise as a whole and each department within it.

Planning involves defining the organizations goals, establishing overall strategy

for achieving goals, and developing a comprehensive set of plans to integrate,

coordinate organizational work.


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Nature of PlanningThe nature of planning can be highlighted by studying itscharacteristics. They are as follows,

Planning is a mental activity. Planning is not a simple process. It isan intellectual exercise and involves thinking and forethought on thepart of the manager.

Planning is goal-oriented.Every plan specifies the goals to beattained in the future and the steps necessary to reach them. Amanager cannot do any planning, unless the goals are known.

Planning is forward looking. Planning is in keeping with the adage,look before you leap. Thus planning means looking ahead. It isfuturistic in nature since it is performed to accomplish someobjectives in future.


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Nature of Planning (Contd.) Planning is the primary function. Planning logically precedes the

execution of all other managerial functions, since managerial activities inorganizing; staffing, directing and controlling are designed to support theattainment of organizational goals. Thus, management is a circular

process beginning with planning and returning to planning for revisionand adjustment.

Planning is based on facts. Planning is a conscious determination andprojection of a course of action for the future. It is based on objectives,facts and considered forecasts. Thus planning is not a guess work.

Planning is flexible. Planning is a dynamic process capable of

adjustments in accordance with the needs and requirements of thesituations. Thus planning has to be flexible and cannot be rigid.

Planning is essential for decision making. Planning is a choice activityas the planning process involves finding the alternatives and the selectionof the best. Thus decision making is the cardinal part of planning.


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Importance of PlanningAccording to G.R. Terry, Planning is the foundation of most successful actions ofall enterprises. An enterprise can achieve its objectives only through systematic

planning on account of the increasing complexities of modern business. Theimportance and usefulness of planning can be understood with reference to the

following benefits.

(a)Minimizes uncertainty: The future is generally uncertain and things are likely tochange with the passage of time. Planning helps in minimizing the uncertainties ofthe future as it anticipates future events.

(b)Emphasis on objectives: The first step in planning is to fix the objectives. Whenthe objectives are clearly fixed, the execution of plans will be facilitated towards

these objectives.(c)Promotes coordination. Planning helps to promote the coordinated effort onaccount of pre-determined goals.

(d)Facilitates control. Planning and control are inseparable in the sense thatunplanned actions cannot be controlled. Control is nothing but making sure thatactivities conform to the plans.


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Importance of Planning (Contd.)(e) Improves competitive strength. Planning enables an enterprise todiscover new opportunities, which give it a competitive edge.

(f) Economical operation. Since planning involves a lot of mental

exercise, it helps in proper utilization of resources and elimination ofunnecessary activities. This, in turn, leads to economy in operation.

(g) Encourages innovation. Planning is basically the deciding functionof management. Many new ideas come to the mind of a manager whenhe is planning. This creates an innovative and foresighted attitudeamong the managers.

(h) Tackling complexities of modern business. With modern businessbecoming more and more complex, planning helps in getting a clearidea about what is to be done, when it is to be done, where it is to bedone and how it is to be done.


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Strategic Plans Strategic planning sets the long-term direction of the org in which it

wants to proceed in future.

It focus on the broad future of the org. Incorporating both external

information gathered by analyzing the companys competitiveenvironment and the firms internal resources, managers determine thescope of the business to achieve the org long-term objectives.

Tactical Plans

Tactical plans translate the strategic plans into specific goals for specificparts of the organizations.

They are for shorter time frame and usually focused for 1-2 years

Instead of focusing on the entire corporation, tactical plans typicallyaffect a single business within an organization.


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Operational Plans Operational plans translate the tactical plans into specific goals and actions for

small units of the organization.

They typically focus on the short term usually 12 months or less. These plans are least complex than strategic and tactical plans, and rarely have a

direct effect on other plans outside of the department or unit for which the planwas developed.Proactive Reactive Plans

Proactive planning involves designing suitable courses of action in anticipation of

likely changes in the relevant environment. In this approach, org do not wait forthe environment to change but take action in advance. In India companies likereliance, Hindustan unilever have adopted this approach for the faster growth.

In reactive planning, organizations responses come after the environmentalchanges have taken place. In such situation the org lose opportunities to those orgwhich adopt proactive approach.


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Formal Informal Planning Formal planning is in the form of well-structured process involving

different steps.

In large organizations they undertake planning in formal way in whichthey create corporate planning cell placed at sufficiently high level in theorganizations.

Informal planning is undertaken by the smaller organizations, theplanning process is based on managers memory of events, intuitions andgut-feeling, rather than based on systematic evaluation of theenvironment.Single Standing Use Plans

Standing plans are put to use again and again over a long period of time.Once established they continue to apply until they are modified orabandoned. Standing plan help managers in dealing with routine mattersin a pre-determined and consistent manner.

Examples of standing plans are: organizational mission and long termobjectives, strategies, policies, procedures and rules.


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Requirements of a Good Plan(a) Clear objective: The purpose of plans and their components is to develop and

facilitate the realization of organizational objectives. The statement on objectivesshould be clear, concise, definite and accurate. It should not be colored by biasresulting from emphasis on personal objectives.

(b) Proper understanding: A good plan is one which is well understood by thosewho have to execute it. It must be based on sound assumptions and sound

reasoning.(c) Flexible: The principle of flexibility states that management should be able to

change an existing plan because of change in environment without undue extracost or delay so that activities keep moving towards the established goals. Thus, agood plan should be flexible to accommodate future uncertainties.

(d) Stable: The principle of stability states that the basic feature of the plan shouldnot be discarded or modified because of changes in external factors such as

population trends, technological developments, or unemployment.(e) Comprehensive: A plan is said to be comprehensive when it covers each and

every aspect of business. It should integrate the various administrative plans sothat the whole organization operates at peak efficiency.

(f) Economical: A plan is said to be good, if it is as economical as possible,

depending upon the resources available with the organization.


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A Framework for Planningi. Define present situation.

ii. Establish goals and objectives.

iii. Analyze environment in terms of aids and barriers to goals and

objectives.

iv. Develop action plans to reach goals and objectives.

v. Develop budgets (most action plans require money and otherresources).

vi. Implement the plans.

vii. Control the plan (and return to Step 1 if the plan has not worked

well).viii. Make Contingency Plans:The purpose of contingency plans is to

develop an alternative in case the original plans cannot beimplemented successfully or at all.


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Steps in Planning Process


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Steps in Planning Process (Contd.)There are seven essential steps in operating planning process. Managers use this

process in carrying out their jobs .

Steps in operating planning process:

1) Setting Goals:Establish the targets for the short and long range future.

For example:

- 25 percent growth over last year sales in present financial year.

- To increase market share by 5 percent in next five years.

2) Analyzing and evaluating the environment:

Analyze the present position and resources available to achieve objectives.

- Where are we now?

- What are the limitations in the environment?

- What resources do we have?

- Are there any external factors that can influence the objectives and there

accomplishment?


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Steps in Planning Process (Contd.)3) Determining Alternatives:

Construct a list of possible courses of action that will lead you to your goal.

4) Evaluating the alternative:

Listing and considering the various advantages and disadvantages of eachof your possible course of action.5) Selecting the Best solution:

Selecting the course of action that has the most advantages and the fewestserious disadvantages.

6) Implementing the Plan:

Determine, who will be involved, what resources will be assigned how theplan will be evaluated, and reporting procedures.7) Controlling and evaluating the Results:

Making certain that the plan is going according to expectations and makingnecessary adjustments.


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Barriers to effective Planning(a) Influence of external factors: The effectiveness of planning issometimes limited because of the external social, political, economicaland technological factors which are beyond the control of the planners.

(b) Non-availability of data: Planning needs reliable facts and figures.Planning loses its value unless reliable information is available.(c) Peoples resistance:Resistance to change hinders planning.Planners often feel frustrated in instituting new plans, because of theinability of people to accept them.

(d) Time and Cost: Collection of data and revision of plans involvesconsiderable time, effort and money.

(e) Inflexibility: Formal planning efforts can lock an organization intospecific goals to be achieved within specific timetables. When theseobjectives were set, the assumption may have been made that theenvironment wouldnt change during the time period the objectivescover.


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Presentation On Planning

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