This document discusses planning and decision making in management. It covers the nature, characteristics, importance and purposes of planning. It describes different types of plans based on nature (strategic, tactical) and use (single use, standing). Decision making is an integral part of planning and different types of decisions are discussed such as pragmatic vs non-pragmatic, individual vs collective, minor vs major. Techniques for collective decision making like nominal group and Delphi are also summarized. Steps in decision making and planning are outlined. Finally, the hierarchy of plans from goals/objectives to action plans is presented.

1. Subject Name:
Subject Code:
Prepared By:
Department:
Date
11/26/2014

2. PLANNING
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3. NATURE OF PLANNING
• Most basic function of management
• “Deciding in advance” as to what to do , how to do , when to do and who has to do
it
• Intellectual process
• Continuous process
• Involves selection of objectives and goals and determines the ways and means to
achieving them
• Bridges gap from where we are to where we want to be
• Flexible in all areas like technology, marketing , finance , personnel and
organization
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4. CHARACTERISTICS OF PLANNING
• Contribute to accomplish purpose and objectives
• Parent exercise in all processes
• Spread through all management functions
• Efficient enough to achieve designed goals at least cost
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5. IMPORTANCE OF PLANNING
• Overcomes uncertainty and change and thus minimises risk
• Planning helps to make logical decisions
• Facilitates effective control
• Planning sets goals, targets and means to accomplish these goals
• Focuses attention and concentration only on the objectives of
enterprise
• Makes economic operation and leads to success
• Serves as a bridge between present and future
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6. PURPOSE OF PLANNING
• To select from may available alternatives
• To direct all other functions of management
• To set up goals
• Enables to break the overall planned goal into simpler additive segmented
goals
• Forms the basis for budget
• Forecast the future
• Provides effective control
• Search for alternatives and adopt the best
• To focus the vision on objectives and goals
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7. OBJECTIVES
• “Objectives are goals or targets which one wishes to achieve”
OR
“Objectives are goals or targets towards which all business activities are
directed”
Requirements of good objective
• clear and acceptable
• Support one another
• Should be precise
• Must be measurable
• Realistic and valid ones
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8. TYPES OF PLANS
(BASED ON ITS NATURE)
Strategic Planning
• Long Term
• Performed at top management
• Consist of major goals and policies of
an organization and resources and
facilities to accomplish the goals
• Less detailed, focuses only on long
term goals
• Based on long term goals and is more
uncertain
Tactical Planning
• Short Term
• Performed at Lower levels of
management
• Consist of use of resources and
facilities
• More detailed, focuses only on day to
day operations
• Based on performance and is less
uncertain
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9. TYPES OF PLANS
(BASED ON ITS USE)
Single use plans
• Developed to achieve a specific
end
• Plan becomes useless after
reaching target
Standing Plans
• Designed for situations that often
repeat
• Plans can be used again and again
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10. DECISION MAKING
• Integral part of planning process
• Defined as the process of choosing among alternatives
• Occurs in all stages of planning process
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11. TYPES OF DECISIONS
Pragmatic
• Decisions taken with the purview of
policy,rules or procedures
• Also called as programmed,routine
or structured decisions
• Taken frequently and are repetitive in
nature
Non Pragmatic
• Called as non-programmed or
strategic or policy decisions
• Heavy expenditure and taken by top
management
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12. TYPES OF DECISIONS
Individual
 Decisions taken by a single individual
 Taken when the problem is of routine
nature and definite rules and
procedures exist.
Collective
 Decisions taken by a committee or group
of people
 Interdepartmental decisions and important
strategic decisions are taken by a group
 Advantages
• Increased acceptance
• Better communication
• Better co-ordination
• Disadvantages
• Delay in arriving at decision
• Group may be indecisive
• Groups may compromise or dominate
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13. NOMINAL GROUP AND DELPHI TECHNIQUES
The Delphi method :
A more formal method of jury of opinion method.
- A panel of experts who are physically dispersed and anonymous to one
another is given a situation and asked to make initial prediction on the basis of a
prescribed questionnaire
- these experts develop written opinions.
- these responses are analyzed and summarized and submitted back to the
panel for further considerations
Nominal group technique :
- Members independently generate their idea and give in writing
- Ideas are summarised and discussed for clarity and evaluation
-Each member silently rates his/her idea through a voting system
-One with maximum vote is selected
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14. Types of decisions
Minor Decision
• Decisions related to day to
day and periodical
occurrences
Major Decision
• Decision taken by top
management
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15. TYPES OF DECISIONS
• Minor and Major
Minor - Decisions related to day to day and periodical occurrences
Major - Decision taken by top management
• Strategic and Routine
Strategic – Similar to major decisions and taken by top management.
Routine – Decisions related to the day to day operations of an organization
• Simple and Complex
Simple – Related to few number of variables
Complex – Many variables
• Temporary and Permanent
Temporary-Temporary in nature and are taken to meet an unexpected solution
Permanent- Permanent in nature
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16. STEPS IN DECISION MAKING
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17. STEPS IN PLANNING AND PLANNING PREMISES
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18. HIERARCHY OF PLANS
• The top management sets the goals and objectives(long-term plans and
strategies)
• Such objectives are broad and achieved by strategies.
• Strategies are carried out by two types of plans.
Single-use plans
Standing plans
• Action plans are routine plans executed by lower level management.
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19. HIERARCHY OF PLANS
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Goals
&
objectives
Strategies
Single use
plans
Standing
Plans
Action Plans
Top Level Management
Middle Management
Foreman & Supervisors