Planning

Planning

may be define as selecting the best course of an action in anticipation of future trends so that the desired result may be achieved.

The nature of Planning

To minimize mistakes in decision- making, planning is undertaken.

A plan, which is the output of planning, provides a methodical way of achieving desired result.

Planning at Various Management Levels

Planning activities are undertaken at various levels are as follows:1. top management level – strategic planning

2. middle management level—intermediate planning

3. lower management level – operational planning

Strategic Planning

Refers to the process of determining the major goals of the organization and the policies and strategies for obtaining and using resources to achieve those goals.

Intermediate planning

Refers to the process of determining the contribution that subunits can make with allocated resources.

Operational planning

the process of determining how specific task can best accomplished on time with available resources.

The planning process

Process of planning consist of various step depending on the management level that performed the planning task.

1. setting organizational, divisional, or unit goals2. developing strategies or tactics too reach those goals

3. determining resources needed4. setting standard

Setting organizational, divisional, or unit goals

The first task of the manager is to provide a sense of direction to his firm(if he is the chief executive), to his division(if he heads a division) or to his unit( if he is a supervisor).

Developing strategies or tactics to reach goals

The next task is to divise some means to realize them. The ways chosen to realize the goals are called strategies and these will be concern of top management.

Determine resources needed

The quantity and quality of resources needed must be correctly determined. Too much resources in terms of either quality or quantity will be wasteful. Too little will mean loss of opportunities for maximizing income.

Setting Standard

The standards for measuring performance may be set at the planning stage. When actual performance does not match with the planned performance, corrections may be made or reinforcements given.

Standard

may be define as a quantitative or qualitative measuring device designed to help monitor the performance of people, capital goods, or process.

Types of plans:

1. Functional area2. Time horizon

3. Frequency of use

Functional Area Plans

1.Marketing Plan—written document or blueprint for implementing and controlling an organization’s marketing activities related to a particular marketing society.2.Production Plan—written document that states the quantity of output a company must produce in broad terms and by product family.

3.Financial Plan—document that summarize the current financial situation of the firm, analyzes financial needs, and recommends a direction for financial activities.

4. Human Resource Management Plan—document that indicates the human

resource needs of a company detailed in terms of quantity and quality and based on

the requirements of the company’s strategic plan.

Plans with Time Horizon:

1. Short-range plans— plans intended to cover a period of less than one year.2. Long-range plans— plans covering a time span of more than one year.

Plans According to Frequency of Use:

1. Standing Plans2. Single Use Plans

Standing Plans

These are plans that are used again and again.

1.Policies—broad guidelines to aid managers at every level making decision about recurring situations or function.

2.Procedures—describes the exact series of actions to be taken in a given situation.

3.Rules—statements that either require of forbid a certain action.

Single Use Plans

Specifically develop to implement courses of action that are relatively unique and are unlikely to be repeated.

1. Budgets— a plan which sets forth the project expenditures for a certain activity and explains where the required funds will come from.

2. Program—designed to coordinate a large set of activities.

3. Project—that is usually more limited in scope than a program and is sometimes

prepared to support a program.

Summary:

Business activities, like other activities, require effective planning if objectives and goals are to be realized.A plan is a methodological way of achieving plan.

Planning is undertaken at various management levels.Various steps are required in the planning process depending on the management level.

Plans may be classified in terms of functional areas, time horizon, and frequency of use.Plan consist of various parts that the manager must be familiar with.

Plans can be made effective by recognizing the planning barriers and making use of planning aids.