Planning Chapter 3 Unit 2 Planning defined n

Planning Chapter 3 Unit 2

Planning defined n n Planning is deciding in advance what to do, how to do it, when to do it and who is to do it. Planning is the process of establishing goals and a suitable course of action for achieving those goals. It provides the bridge to take us from where we are to where we want to go. It is a mental predisposition to do things in an orderly way, to think before acting and to act in the light of facts rather than guesses.

Planning: Nature and Characteristics � Goal oriented � Future oriented � Continuous � Pervasiveness � Intellectual process � Primacy of Planning � Helps in Co-ordination � Involves decision making � Efficiency, Economy and Accuracy

Advantages of Planning � Minimizes risks of uncertainty � Facilitates coordination � Facilitates proper direction � Establishes standard for control � Improves efficiency � Encourages innovation � Facilitates decision making � Reduces wastage of resources

Limitations of Planning � Time consuming � Involves paper work � Expensive � Generates Rigidity � Dangers of over targeting and under targeting � Danger of Human error � Problems with technical and creative staff � Problems of changing situations

Planning Process Determine objectives Choose best alternative Develop derivative plans Collect information and forecast Study alternative plans Communicate and Implement Develop Planning Premises List alternative ways of reaching objectives Follow up

Elements of Planning � Objectives: ◦ provide purpose of the enterprise ◦ end point of planning ◦ act as guide to overall planning process � Strategy ◦ Complete plan for accomplishing organizational goals ◦ Framing long term objectives � Policies ◦ General guide to thinking and action rather than a specific course of action � Procedure ◦ Steps to carry out routine activities

Elements of Planning � Method � Rule � Programme � Budget ◦ Prescribed manner in which a task is to be performed ◦ Deals with task comprising one step of a procedure ◦ Statements informing what should be done what not under a given situation ◦ No flexibility or discretion allowed ◦ Concrete scheme of action designed to accomplish given tasks ◦ Includes steps to be taken, resources to be used, time limits for each step and assignment of tasks ◦ Detailed statements about a project outlining objectives, policies, procedures, rules, resources required and budget to implement any course of action ◦ Plan quantifying future facts and figures ◦ Represents the total income and expenses

Types of Planning Long term planning On the basis of Time Period Medium term planning Short term planning Types of Planning Corporate planning On the basis of scope Divisional planning Departmental or Unit planning

MBO-Management by Objectives � By Peter Drucker � Each and every employee of the organization working whole heartedly towards the attainment of objectives of the organization � Objectives of the organization must be set by both management and subordinates jointly � Aims at coordinating individual goals with organizational roles

Elements of MBO � Goal specificity � Participative decision making � Explicit time period � Performance feedback

MBO Process

Advantages of MBO � Optimum utilization of human resources � Better communication � Fixed responsibility � Increased employee morale and motivation � Career development of the employees � Effective planning and control

Disadvantages of MBO � Insufficient support from top management � Insufficient integration with other systems � Improper follow up � Time consuming � Reward punishment approach-stress � Difficult to coordinate management and employees objectives