Plannning and Types of planning

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Planning and types of Planning

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Plannning and Types of planning

  1. 1. Prestige Institute Of Management &Research ,Indore Presentation On Type Of Planning, Its advantages &Limitations Submitted to: Dr. Rajeev Bhatnagar Submitted by: Deepika Mantri Garima Patil Priyanka Daryani Shalabh Sharma Varsha Talreja
  2. 2. Index What is PLANNING? TYPES OF PLANNING Advantages Limitations
  3. 3. “PLANNING” Planning is deciding in advance what is to be done, when where, how and by whom it is to be done. Planning bridges the gap from where we are to where we want to go. It includes the selection of objectives, policies, procedures and programmes from among alternatives
  4. 4. TYPES OF PLANNING
  5. 5. PLANNING ACTITVITY COVERED PERIOD APPROA CH Long term Short term FORMULATI IMPORTAN CE ON FORMAL INFORMAL Corporate PROACTIVE REACTIVE Functional STRATEGIC OPERATION AL
  6. 6. ACTIVITY COVERED Corporate Planning :  Determines long-term objectives of an organisation as whole  Generates plans to achieve these objectives  Future orientated  Integrated Functional planning :  Undertaken for sub functions witin each major functions  Derived from corporate planning.  Segmental
  7. 7. TIME-PERIOD Depends on the type of the buisness and structure of the organisation. LONG TERM :  Strategic in nature.  Involves generally 3-5 years.  It relates to matters like new product ,product diversification .
  8. 8. SHORT TERM : • Short term planning typically covers time frames of less than one year in order to assist their company in moving gradually toward its longer term. • Examples are the skills of the employees and their attitudes. The condition of production equipment or product quality problems are also short-term concerns.
  9. 9. APPROACH PROACTIVE PLANNING :  Designing suitable course of action in anticipation of likely changes in relevant environment.  To take decision in advance.  Eg : Emergency organisations REACTIVE PLANNING :  Reactive planning is the process whereby future action is dictated as a response to whatever has already, or is now occurring.  Eg. Hotel Manager.
  10. 10. DEGREE OF FORMALISATION FORMAL PLANNING :  It is a structured plan.  It has some procedure to follow.  Written record is followed in formal plan.  Eg. Five year plan of a country. INFORMAL PLANNING  It is unstructured plan.  It does not have any procedure to follow.  No record is maintained for future purpose.
  11. 11. IMPORTANCE OF CONTENTS STRATEGIC :  It sets future directions of the organization in which it wants to proceed in future.  It involves a time horizon of more than one year and for most of the organization it ranges between 3 and 5 years.  Strategic plans are generally developed by top level management.  Eg. diversification of business into new lines, planned grown rate in sales.
  12. 12. OPERATIONAL Operational plans are developed to determine the steps necessary for achieving tactical goals.. They are used as a guide for day to day operation by department managers. These plans may cover a time frame of few months, weeks or even a few days.
  13. 13. ADVANTAGES Planning facilitates management by objectives Planning minimizes uncertainties Planning facilitates co-ordination Planning improves employee’s moral Planning helps in achieving economies Planning facilitates controlling Planning provides competitive edge Planning encourages innovations
  14. 14. Planning facilitates management by objectives  Planning begins with determination of objectives.  It highlights the purposes for which various activities are to be undertaken.  In fact, it makes objectives more clear and specific.  Planning helps in focusing the attention of employees on the objectives or goals of enterprise.  Without planning an organization has no guide.  Planning compels manager to prepare a Blue-print of the courses of action to be followed for accomplishment of objectives.  Therefore, planning brings order and rationality into the organization.
  15. 15. Planning minimize uncertainties  Business is full of uncertainties.  There are risks of various types due to uncertainties.  Planning helps in reducing uncertainties of future as it involves anticipation of future events.  Although future cannot be predicted with cent percent accuracy but planning helps management to anticipate future and prepare for risks by necessary provisions to meet unexpected turn of events.  Therefore with the help of planning, uncertainties can be forecasted which helps in preparing standbys as a result, uncertainties are minimized to a great extent.
  16. 16. Planning facilitates coordination Planning revolves around organizational goals. All activities are directed towards common goals. There is an integrated effort throughout the enterprise in various departments and groups. It avoids duplication of efforts. In other words, it leads to better co-ordination. It helps in finding out problems of work performance and aims at rectifying the same.
  17. 17. Planning improves employee’s moral. Planning creates an atmosphere of order and discipline in organization. Employees know in advance what is expected of them and therefore conformity can be achieved easily. This encourages employees to show their best and also earn reward for the same. Planning creates a healthy attitude towards work environment which helps in boosting employees moral and efficiency
  18. 18. Planning helps in achieving economies  Effective planning secures economy since it leads to orderly allocation ofresources to various operations.  It also facilitates optimum utilization of resources which brings economy in operations.  It also avoids wastage of resources by selecting most appropriate use that will contribute to the objective of enterprise. For example, raw materials can be purchased in bulk and transportation cost can be minimized. At the same time it ensures regular supply for the production department, that is, overall efficiency
  19. 19. Planning facilitates controlling Planning facilitates existence of certain planned goals and standard of performance. It provides basis of controlling. We cannot think of an effective system of controlling without existence of well thought out plans. Planning provides pre-determined goals against which actual performance is compared. In fact, planning and controlling are the two sides of a same coin. If planning is root, controlling is the fruit .
  20. 20. Planning provides competitive edge.  Planning provides competitive edge to the enterprise over the others which do not have effective planning. This is because of the fact that planning may involve changing in work methods, quality, quantity designs, extension of work, redefining of goals, etc.  With the help of forecasting not only the enterprise secures its future but at the same time it is able to estimate the future motives of it’s competitor which helps in facing future challenges.  Therefore, planning leads to best utilization of possible resources, improves quality of production and thus the competitive strength of the enterprise is improved
  21. 21. Planning encourages innovations. In the process of planning, managers have the opportunities of suggesting ways and means of improving performance. Planning is basically a decision making function which involves creative thinking and imagination that ultimately leads to innovation of methods and operations for growth and prosperity of the enterprise
  22. 22. Limitations of Planning
  23. 23. Costly process Planning involves too much expenditure. Money and effort both are required in planning. Planning includes collecting information, data forecasting and evaluation of alternatives. It requires salary and allowances to the experts in the process of providing services.  So, planning has been accepted as costly process by small and medium size organization 
  24. 24. Time consuming Planning is the time consuming process. It delays the business activity to come in action.  In the process of planning following the procedures of planning takes a lot of time which may create problem to the organization where immediate action has to be made. So in such situation planning is not suitable.
  25. 25. False sense of security Planning encourages false sense of security against future risk and uncertainty. As future is uncertain, it is unpredictable. Therefore, planning cannot give accurate and reliable results.
  26. 26. RAPID CHANGE Rapid changes in technology ,consumer tastes and prefernces are further limitations to planning. Eg.: Planning in aircraft ,chemical,electronic and information industries is specially complicated due to acceptionally complex and rapidly changing production technology.
  27. 27. PREMIUM ON PRESENT Present is always more real than the future , and present problems seem to be more urgent than the future problems. Many of us are inclined to take care of today and hope that tommorow will take care of itself . This is normal human tendency but infact we have to take take care of today as well as tommorow.

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