Planning, Nature, Significance, Process of Planning, Types of Planning, Planning Premises.

1. Ms.Sadhana Banerji
Asst.Professor

2. CONCEPT OF PLANNING
Planning is the primary function of a manager
To get things done by the manager every manager has
to plan
A manager organize, directs and controls to ensure the
accomplishment of predetermined goals according to
plans.
Planning basically precedes all managerial functions .
Planning is unique in the sense that it establishes the
objectives for the group effort and lays down step to
accomplish them before manager proceeds to perform
other function.

3. DEFINITION
• Planning is the process of deciding in advance
what is to be done ,who is to do to it ,how it is to
be done and when it is to be done.– Killen
• Is a process by which manager looks to the future
&discovers alternatives courses of action open to
him”- Joseph Massie
• Planning is anticipating - Earl Strong

4. Key elements of Planning
1. Process of deciding in advance what is to be done
,how when and by whom.
2. Logical thinking before doing.
3. Process of visualizing and anticipating the future
by evaluating the past and assessing the present.
4. It bridges the gap between “where we are” to
“where we want to go”.
5. Process of determining objectives ,discovering
alternative courses of action &selecting the
suitable courses of action.

5. Nature of Planning
1. Is an intellectual activity
2. Involves selection among alternative
3. Is a primary function of management.
4. Involves Forward looking
5. Is related to objectives
6. Is a goal oriented process
7. Is all pervasive
8. Is a continuous process

6. Importance of Planning
1.Economizes the operation
2.Provides future destination
3.Coping with the changing environment
4.Provides direction, coordination
5.Facilitates control
6.Discovery of new business ideas and opportunities
7.Improves competitive strength.

7. PROCESS OF PLANNING
PLANNING
PROCESS
Establishing
objectives 1.
Collection of
information and
forecasting 2.
Development of
planning premises
3.
Search of
Alternatives 4. ves
5.Evaluation
of
alternatives
6.Selection of
Plan
7
7.Laying down
derivatives

8. Steps
1. The first step in the planning is the determination of
objectives.
2. Sufficient information must be collected in order to
make the plans and sub plans.
3. To scan the external environment. To identify the
affected areas of business.
4. The next step involves making assumptions concerning
the behavior of internal and external factors.
5. To formulate planning premises(Assumptions denotes
the expected environment in the future and are known
as planning premises.

9. Contd…
• To develop alternative courses of action through
research, analysis, and past experience.
• To evaluate courses of action in terms of risk, cost ,
efficiency& resource position.
• To formulate derivative/sub plans known as operational
plans/programmes.

10. Essentials of a Good Plan
• It should be based on clearly defined objectives
• It must be simple
• Have a clear goal
• It should be logical
• It should be complete and integrated
• It should be flexible
• It should be capable of being of controlled

11. Barriers to effective Planning
1. Lack of reliable data
2. Rigidity in organizational working.
3. Costly and time consuming
4. Employee resistance
5. Managerial deficiencies
6. External limitations

12. TYPES OF PLANNING
1. STRATEGIC PLANNING
2. OPERTAIONAL PLANNING

13. 1. STRATEGIC PLANNING
a) A General plan outlining decisions of resource allocation,
priorities and action steps necessary to reach strategic
goals.
b) It is devised by the top management
c) The basic purpose of this planning is to adapt to the
external environment base on internal strength.
d) The basis for this planning is basically judgmental.
e) It is uncertain in nature.

14. 2. OPERATIONAL PLANING
• Operational planning is concerned with efficient use of their
resources already allocated and with the development of a
control mechanism to ensure efficient operation so that
organizational objectives.
• It lays down programmes, budgets, projects, policies,
procedure ,rules, etc.

15. Time Span of Planning
1. Long range planning
2. Medium range planning
3. Short term planning

16. 1. Long range Plan
a) Covers a period of 5 years or more
b) States what the organization wants to become in the long
run
c) Tries to focus on organization linkage with the external
environment
d) Defines the mission of the organization, outlines major
strategies and specifies action plans to realize targets
e) Developed by top management

17. 2.Medium Range Planning
a) These are plans which are made to support the long term
plans.
b) Medium term planning usually covers a period of more than
one year but less than five years.
c) For e.g. Development of products, product publicity etc.

18. 2.SHORT RANGE PLANNING
a) A plan that is specific and detailed generally covers a span
of one year or less. These plans are otherwise called as
operational plans they are usually made in specific and
detailed manner.
b) The primary focus is on effectiveness. These plans provide
content and form to long-range plans. In fact short range
plans are the extension of long range corporate plans.
Example: market plans, production plans and financial
plans are typical examples of operational planning.

19. Planning Premises
• Every plan is based on assumptions ,known as planning
premises ,which relate to the anticipation of the future
environment.
• The more the individuals charged with planning
understand and agree to utilize consistent planning
premises the more coordinated enterprise planning will
be”
-Koontz o Donnel
• Planning is the fundamental function of a manager it is
deciding in advance what is to be done how and by
whom

20. Planning premises
• Thus a plan is a determined course of action it is an attempt
on the part of the a manager to anticipate the future in
order to achieve better results .
• But effective planning is largely dependent on knowledge
and accurate choice of planning premises.
• Hence the definition, description and analysis of planning
premises becomes imperative .
• Thus planning premises provides a bed rock on which upon
which the plans are based .
• There are enumerable factors which have a bearing on the
business of the firm .

21. Contd…
• Thus mgmt. cannot successfully plan without their
knowledge .the manager tries to forecast only those
factors which are strategically important and which have
material bearing on his business.

22. Types of planning premises
1. External and Internal premises
2. Tangible and Intangible premises
3. Controllable, Semi controllable, and
Uncontrollable premises

23. 1. Internal planning premises
a) These factors which exist within the firm or which
belong to the firms own climate.
b) Important internal factors include the resources and the
abilities of the firm in the in form of money, men and
method.
c) The ability and the competence of the management as
well as the subordinates determine the size, quality and
the extent of the sales forecasts, capital budgeting
decisions and preparation of other plans and policies.
d) They are definite known as fully controllable factors.

24. 2. External planning premises:
a) Pertains to the outside environment of the firm e.g. the
product market, material market , capital market or
labor market, monetary fiscal policy, trends in
population growth education and national income.

25. 2. Tangible and intangible premises:
a) Tangible premises are those premises which are
quantifiable in some unit , on the other hand intangible
premises are those factors which cannot be quantified
b) Thus they are qualitative in nature e.g. A firms
reputation.

26. 2.Controllable,semi controllable, and
uncontrollable premise
The factors which are entirely within the control of the
management like the managerial policies, programmes and
rules are e.g. of controllable premises.
• Uncontrollable-
Strikes ,wars , natural calamities that is the factors which
are not in control of the management. They are neither
predictable nor controllable.
• Semi controllable-
Those over which the management has partial control
,workers attitude ,efficiency ,firms pricing policy, marketing
programme, etc are such premises.

27. Importance.
1. Planning premises plays a major role as the successful
planning depends on it fully controllable factors.
2. Management needs to forecast their trends and variations,
no successful and sound planning can be done without
discussing all possible planning premises.
3. The various planning premises provide the bedrock upon
which the planning is projected .
4. The knowledge of strategic factors guides the management to
select the proper and adequate premises upon which he can
raise the superstructure of planning.