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PLANNING

MADE BY: MOHIT SHARMA
 INDRAJEET KUMAR
 REEMA MAGGON
 GAURAV KUMAR
 ODIL LAKRA
DEFINITION
Planning bridges the gap from where we are to where

we want to go. It makes it possible for things to occur
which would not otherwise happen"
- Koontz and O'Donnell.

Planning is deciding in advance what to do, how

to do it, when to do it & who is to do it . It bridges
the gap from where we are to where we want to
go.
GOALS ARE IMPORTANT FOR
FOLLOW
ING REASONS
GOALS PROVIDE A SENSE OF DIRECTION: By

setting goals, people and their organizations
bolster their motivation and gain a source of
inspiration that helps them overcome the
inevitable obstacles they encounter.

GOALS FOCUS OUR EFFORTS: In selecting a

single goal we establish priorities and make a
commitment about the way we will use our scarce
resources.
Contd…….
GOALS GUIDE OUR PLANS AND

DECISIONS: It shapes both our short term
and long term plans and help you make key
decisions.

GOALS HELP US EVALUATE OUR

PROGRESS: Goals are an essential part of
controlling- the process of making sure that
actions are in keeping with goals and the
plans created to achieve them.
Nature of planning

Goal Oriented : It is closely associated with the

objectives of the organization. It lays down the action
that will lead toward the ultimate objectives.
Forward looking : Planning is always concerned with
looking into the future.
Primary function : The beginning phase of the
management process is planning. It is based upon the
organizational objectives.
Effectiveness of planning : The effectiveness of
planning is measured by its contribution in reaching
organizational objectives versus its corresponding
costs.
Contd………

Unity & consistency : It leads to achievement of

overall objectives with consistency in behavior &
action.
 Pervasive : It is inherited at every level of an
organization. The higher one goes in the
management structure, the more time will spent on
planning.
Selection of alternatives : It is concerned with
selecting the best course of action among the
alternatives.
Objectives of Planning
Reduces uncertainty- future is uncertain so we have

to Convert uncertainty in to certainty.
Brings co-operation & co-ordination- in various
sections of the organization there are Rivalries &
conflicts among departments these could be
avoided through planning.
Economy in operation-By selecting best
alternatives among various alternatives and best
utilization of resources objectives of the
organization are achieved easily.
Anticipates unpredictable contingencies- some
events are unpredicted and this could affect smooth
functioning of an enterprise planning is a provision
to tackle this problem.
Contd……..
 Achieving the predetermined goals- This is the main

objective of an organization
 Reducing competition- stiff competition should be
avoided
 By Avoiding business failures
 By conducting an environmental analysis
 By Creating an organizational mission
 By Creating an organizational vision
Steps in Planning
 A planning is one of most importance to an

organisation. Most organizations follow the same set
of fundamentals when dealing with management.
Planning is basically preparing, scheduling, arranging,
or setting up to achieve organization goals.
 Process of planning should be carried out in a
systematic manner.
Steps in Planning
Identify objectives
/goals

Review of current
status/ premises
SWOT

Collection and forecasting
of Information

FEEDBACK

Communicating
the plan

Formulation of
derivative plans

Select the alternative
Course of action
W Planning is Important
hy
Good Planning provides:
Increases efficiency
Reduces business-related risks
 Facilitates proper coordination
Aids in organising
Gives right direction
Keeps good control
Helps to achieve objectives
Motivates the personnel
Encourages creativity and innovation
Helps in decision making
W Planning Fails
hy
Lack of reliable data :

Planning loses its values if reliable information is not available or if
the planner fails to utilize the reliable information
Rigidity in organizational working : Inflexibility in the
organization may lead to rigid plans. Managers should not
required to follow the procedures rigidly.
Lack of understanding : There are different levels in an
organization and steps involved in planning process. It may create
confusion among subordinates or they may not skilled in
understanding all steps of the planning requirements.
Resistance to change : Employees do not like change and

sometimes they do not think that it desirable to bring
change. The reasons may be loss of status, fear of failure,
insecurity, lack of understanding etc.
Time consuming : Planning involves analyzing information

and evaluation of various alternatives and also involves cost
of gathering it. Result may not achieved if desired time not
spent on plans.
Advantages of Planning
 Planning facilitates management by objectives –
 It highlights the purposes for which various activities are to







be undertaken.
Planning helps in focusing the attention of employees on the
objectives or goals of enterprise.
Planning minimizes uncertainties –
Planning helps in reducing uncertainties of future as it
involves anticipation of future events.
Planning facilitates co-ordination –
Planning revolves around organizational goals.
All activities are directed towards common goals.
 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.
 Planning helps in achieving economies –
 Effective planning secures economy since it leads to orderly

allocation of resources to various operations.
 It also facilitates optimum utilization of resources which
brings economy in operations.
 Planning facilitates controlling –
 Planning facilitates existence of certain planned goals and

standard of performance.
 It provides basis of controlling.
 Planning encourages innovations –
 In the process of planning, managers have the opportunities

of suggesting ways and means of improving performance.
 It creates a forward looking attitude amongs the managers.
Planning process
 Planning starts with the setting of goals and

objectives to be achieved
 Planning requires a systematic approach.
 Planning premises may be internal or external.
Internal includes capital investment policy,
management labour relations, philosophy of
management, etc. Whereas external includes socioeconomic, political and economical changes.
Steps involved in Planning
Process
1. Goal setting:
 Plans are the means to achieve certain ends or objec­tives.
Setting objectives is the most crucial part of planning. The
organizational objectives should be set in key areas of
operations. Establishment of goals is influenced by the values
and beliefs of executives, mission of the organization,
organizational resources, etc. The objectives must be clear,
specific and informative. 
2. Developing the planning premises:
 Before plans are prepared, the assumptions and conditions
underlying them must be clearly defined these assumptions
are called planning premises and they can be identified
through accurate forecasting of likely future events.
Assessment of environment helps to reveal opportunities and
constraints. Analysis of internal (controllable and external
(uncontrollable) forces is essential for sound planning
premises are the critical factors which lay down the bounder
for planning.
3. Reviewing Limitations:
 In practice, several constraints or limitations affect the ability
of an organization to achieve its objectives. These limitations
restrict the smooth operation of plans and they must be
anticipated and provided for. The strong and weak points of
the enterprise should be correctly assessed.
4. Deciding the planning period:
 Once the broad goals, planning premises and limitations are
laid down, the next step is to decide the period of planning.
The planning period should be long enough to permit the
fulfillment of the commitments involved in a decision.
5. Formulation of policies and strategies:
 After the goals are defined and planning premises are
identified, management can formulate poli­cies and strategies
for the accomplishment of desired results. 
 Alternative plans of action should be developed and
evaluated carefully so as to select the most appropriate policy
for the organization.
6. Preparing operating plans:
 After the formulation of overall operat­ing plans, the
derivative or supporting plans are prepared. Several medium
range and short-range plans are required to implement
policies and strategies.
 These plans consist of procedures, programmers, sche­

dules, budgets and rules. Such plans are required for the
implementation of basic plans.
7.Integration of plans:
 Different plans must be properly balanced so that they
support one another. Review and revision may be necessary
before the plan is put into operation. Moreover, the various
plans must be communicated and explained to those
responsible for putting them into practice.
Planning levels
Characteristics of Plans
Time Horizon: refers to how far in the future the plan applies.
Hierarchy of Organization Plans
 Organizations are typically managed according to two

types of plans.

 STRATEGIC PLANS: Plans that are designed by high

ranking managers and define the broad goals for the
organization.

 OPERATIONAL PLANS: Plans that contain details for

carrying out, or implementing those strategic plans in
day to day activities.

 MISSION STATEMENT: Broad organizational goal,

based on planning premises, which justifies an
THE SEVEN-S MODEL
MCKINSEY &CO has proposed the seven-s model for
successful strategy implementation. MCKINSEY’S
consultants found that neglecting any one of seven key
factors could make the efforts to change a slow, painful, and
even doomed process.
 STRUCTURE: A successful organization may make

temporary structural changes to cope with specific strategic
tasks without abandoning basic structural divisions
throughout the organization.
 STRATEGY: The seven-s model emphasizes that the
development of strategies poses less of a problem than their
execution.
 STAFF: Successful organizations view people as valuable
resources who should be carefully nurtured, developed,
Contd…..
 SUBORDINATE GOALS: This refers to guiding

concepts, values and aspirations that unite an
organization in some common purpose.
 SYSTEM: This category consists of all the formal and
informal procedures that allow the organization to
function, including capital budgeting, training, and
accounting systems.
 SKILLS: It refers to those activities organizations do
best and for which they are known.
 STYLE: It refers to the pattern of substantive and
symbolic actions undertaken by top managers. It
communicates priorities more clearly than words and
may influence performance.
OPERATIONALISING
STRATEGY
 OPERATIONAL PLANS: Plan that provides details

needed to incorporate strategic plans into the
organization’s day to day operations.
 SINGLE USE PLANS: Detailed course of action used
once or only occasionally to solve a problem that does not
occur repeatedly.
 PROGR
AM: A single used plan that covers a relatively
large set of organizational activities and specifies major
steps, their order and timing, and the unit responsible for
each step.
 PROJECT: The smaller and separate portions of the
program.
 BUDGETS: Formal quantitative statements of the
resources allocated to specify programs or projects for a
 STANDING PLAN: An established set of

decisions used by managers to deal with
recurring or organizational activities; major types
of policies, procedures and rules.
POLICY: A standing plan that establishes
general guidelines for decision making.
RULES: Standing plans that detail specify
actions to be taken in a given situation.
PROCEDURE: A standing plan that contains
detailed guidelines for handling organizational
actions that occur regularly.
INSTITUTIONALISING
STRATEGY

 An Institution is a collection of values, norms, roles, and

groups that develops to accomplish a certain goal. To
emphasize systems, style, staff, skills, and super ordinate
goals, we need to look at how strategy is institutionalized.
THE ROLE OF THE CEO
Chief executive officers(CEOs) spend most of their time
developing and guiding strategy their personal goals and
values inevitable shape organizational strategy. Their role in
strategy formulation makes CEOs especially important to
strategy implementation. First they interpret strategy, acting
as final judges when managers disagree on implementation.
Second, CEOs enact- through their words and actions- the
seriousness of an organization’s commitment to a strategy.
Third, CEOs motivate, providing intangible incentives
THE STRATEGIC MANAGEMENT
PROCESS
 Strategic management provides a disciplined way

for managers to make sense of the environment in
which their organization operates, and then to act.
Two phases are involved:Strategic Planning: this includes both the goal
setting and the strategy formulation process.
Strategy Implementation: there is a shift from
analysis to administration- the task of achieving
predetermined goals.
BUSINESS STRATEGIES
 LOW COST: Gain a competitive advantage by driving down

organizational cost.
 Managers manufacture at lower cost, reduce waste.
 Lower cost than competition means lower prices.

 DIFFERENTIATION: Gain a competitive advantage by making

our product different from others.
 Differentiation should be valued by customers.
 Successful differentiation allows you to charge more for a
product.
Corporate level Strategies
 Concentrate in single business: MC Donald's focuses in

the fast food business.
• Can become very strong, but can be risky.
 Diversification: Organization moves into new business
and services.
• Related diversification: firm diversifies in similar areas to
build upon existing divisions.
 Synergy: two divisions work together to obtain more than
the sum of each separately.
 Unrelated diversification: buy business in new areas.
• Build a portfolio of unrelated firms to reduce risk or
trouble in one industry
“FIVE FORCES” CORPORATE
STRATEGY
An Organization’s ability to compete in a given
market is determined by that organization’s technical
and economic resources, as well as by five
environmental forces each of which threatens the
organization’s venture into a new market.
The five forces are: THREAT TO NEW ENTRANTS.
 BARGAINING POWER OF BUYERS(CUSTOMERS).
 BARGAINING POWER OF SUPPLIERS.
 THREAT OF SUBSTITUTE PRODUCTS.
 RIVALRY AMONG COMPETITORS.
FUNCTIONAL LEVEL STRATEGIES
 Seeks to have each department add value to a good or

service.
 Marketing, service, production all add value to a good or
service.
 Value is added in two ways:
 Lower the operational cost of providing the value in
products.
 Add new value to the product by differentiating.
 Functional strategies must fit with business level strategies.
Planing

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Planing

  • 1. PLANNING MADE BY: MOHIT SHARMA  INDRAJEET KUMAR  REEMA MAGGON  GAURAV KUMAR  ODIL LAKRA
  • 2. DEFINITION Planning bridges the gap from where we are to where we want to go. It makes it possible for things to occur which would not otherwise happen" - Koontz and O'Donnell. Planning is deciding in advance what to do, how to do it, when to do it & who is to do it . It bridges the gap from where we are to where we want to go.
  • 3. GOALS ARE IMPORTANT FOR FOLLOW ING REASONS GOALS PROVIDE A SENSE OF DIRECTION: By setting goals, people and their organizations bolster their motivation and gain a source of inspiration that helps them overcome the inevitable obstacles they encounter. GOALS FOCUS OUR EFFORTS: In selecting a single goal we establish priorities and make a commitment about the way we will use our scarce resources.
  • 4. Contd……. GOALS GUIDE OUR PLANS AND DECISIONS: It shapes both our short term and long term plans and help you make key decisions. GOALS HELP US EVALUATE OUR PROGRESS: Goals are an essential part of controlling- the process of making sure that actions are in keeping with goals and the plans created to achieve them.
  • 5. Nature of planning Goal Oriented : It is closely associated with the objectives of the organization. It lays down the action that will lead toward the ultimate objectives. Forward looking : Planning is always concerned with looking into the future. Primary function : The beginning phase of the management process is planning. It is based upon the organizational objectives. Effectiveness of planning : The effectiveness of planning is measured by its contribution in reaching organizational objectives versus its corresponding costs.
  • 6. Contd……… Unity & consistency : It leads to achievement of overall objectives with consistency in behavior & action.  Pervasive : It is inherited at every level of an organization. The higher one goes in the management structure, the more time will spent on planning. Selection of alternatives : It is concerned with selecting the best course of action among the alternatives.
  • 7. Objectives of Planning Reduces uncertainty- future is uncertain so we have to Convert uncertainty in to certainty. Brings co-operation & co-ordination- in various sections of the organization there are Rivalries & conflicts among departments these could be avoided through planning. Economy in operation-By selecting best alternatives among various alternatives and best utilization of resources objectives of the organization are achieved easily. Anticipates unpredictable contingencies- some events are unpredicted and this could affect smooth functioning of an enterprise planning is a provision to tackle this problem.
  • 8. Contd……..  Achieving the predetermined goals- This is the main objective of an organization  Reducing competition- stiff competition should be avoided  By Avoiding business failures  By conducting an environmental analysis  By Creating an organizational mission  By Creating an organizational vision
  • 9. Steps in Planning  A planning is one of most importance to an organisation. Most organizations follow the same set of fundamentals when dealing with management. Planning is basically preparing, scheduling, arranging, or setting up to achieve organization goals.  Process of planning should be carried out in a systematic manner.
  • 10. Steps in Planning Identify objectives /goals Review of current status/ premises SWOT Collection and forecasting of Information FEEDBACK Communicating the plan Formulation of derivative plans Select the alternative Course of action
  • 11. W Planning is Important hy Good Planning provides: Increases efficiency Reduces business-related risks  Facilitates proper coordination Aids in organising Gives right direction Keeps good control Helps to achieve objectives Motivates the personnel Encourages creativity and innovation Helps in decision making
  • 12. W Planning Fails hy Lack of reliable data : Planning loses its values if reliable information is not available or if the planner fails to utilize the reliable information Rigidity in organizational working : Inflexibility in the organization may lead to rigid plans. Managers should not required to follow the procedures rigidly. Lack of understanding : There are different levels in an organization and steps involved in planning process. It may create confusion among subordinates or they may not skilled in understanding all steps of the planning requirements.
  • 13. Resistance to change : Employees do not like change and sometimes they do not think that it desirable to bring change. The reasons may be loss of status, fear of failure, insecurity, lack of understanding etc. Time consuming : Planning involves analyzing information and evaluation of various alternatives and also involves cost of gathering it. Result may not achieved if desired time not spent on plans.
  • 14. Advantages of Planning  Planning facilitates management by objectives –  It highlights the purposes for which various activities are to       be undertaken. Planning helps in focusing the attention of employees on the objectives or goals of enterprise. Planning minimizes uncertainties – Planning helps in reducing uncertainties of future as it involves anticipation of future events. Planning facilitates co-ordination – Planning revolves around organizational goals. All activities are directed towards common goals.
  • 15.  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.  Planning helps in achieving economies –  Effective planning secures economy since it leads to orderly allocation of resources to various operations.  It also facilitates optimum utilization of resources which brings economy in operations.
  • 16.  Planning facilitates controlling –  Planning facilitates existence of certain planned goals and standard of performance.  It provides basis of controlling.  Planning encourages innovations –  In the process of planning, managers have the opportunities of suggesting ways and means of improving performance.  It creates a forward looking attitude amongs the managers.
  • 17. Planning process  Planning starts with the setting of goals and objectives to be achieved  Planning requires a systematic approach.  Planning premises may be internal or external. Internal includes capital investment policy, management labour relations, philosophy of management, etc. Whereas external includes socioeconomic, political and economical changes.
  • 18. Steps involved in Planning Process 1. Goal setting:  Plans are the means to achieve certain ends or objec­tives. Setting objectives is the most crucial part of planning. The organizational objectives should be set in key areas of operations. Establishment of goals is influenced by the values and beliefs of executives, mission of the organization, organizational resources, etc. The objectives must be clear, specific and informative. 
  • 19. 2. Developing the planning premises:  Before plans are prepared, the assumptions and conditions underlying them must be clearly defined these assumptions are called planning premises and they can be identified through accurate forecasting of likely future events. Assessment of environment helps to reveal opportunities and constraints. Analysis of internal (controllable and external (uncontrollable) forces is essential for sound planning premises are the critical factors which lay down the bounder for planning.
  • 20. 3. Reviewing Limitations:  In practice, several constraints or limitations affect the ability of an organization to achieve its objectives. These limitations restrict the smooth operation of plans and they must be anticipated and provided for. The strong and weak points of the enterprise should be correctly assessed. 4. Deciding the planning period:  Once the broad goals, planning premises and limitations are laid down, the next step is to decide the period of planning. The planning period should be long enough to permit the fulfillment of the commitments involved in a decision.
  • 21. 5. Formulation of policies and strategies:  After the goals are defined and planning premises are identified, management can formulate poli­cies and strategies for the accomplishment of desired results.   Alternative plans of action should be developed and evaluated carefully so as to select the most appropriate policy for the organization. 6. Preparing operating plans:  After the formulation of overall operat­ing plans, the derivative or supporting plans are prepared. Several medium range and short-range plans are required to implement policies and strategies.
  • 22.  These plans consist of procedures, programmers, sche­ dules, budgets and rules. Such plans are required for the implementation of basic plans. 7.Integration of plans:  Different plans must be properly balanced so that they support one another. Review and revision may be necessary before the plan is put into operation. Moreover, the various plans must be communicated and explained to those responsible for putting them into practice.
  • 23.
  • 25. Characteristics of Plans Time Horizon: refers to how far in the future the plan applies.
  • 26. Hierarchy of Organization Plans  Organizations are typically managed according to two types of plans.  STRATEGIC PLANS: Plans that are designed by high ranking managers and define the broad goals for the organization.  OPERATIONAL PLANS: Plans that contain details for carrying out, or implementing those strategic plans in day to day activities.  MISSION STATEMENT: Broad organizational goal, based on planning premises, which justifies an
  • 27. THE SEVEN-S MODEL MCKINSEY &CO has proposed the seven-s model for successful strategy implementation. MCKINSEY’S consultants found that neglecting any one of seven key factors could make the efforts to change a slow, painful, and even doomed process.  STRUCTURE: A successful organization may make temporary structural changes to cope with specific strategic tasks without abandoning basic structural divisions throughout the organization.  STRATEGY: The seven-s model emphasizes that the development of strategies poses less of a problem than their execution.  STAFF: Successful organizations view people as valuable resources who should be carefully nurtured, developed,
  • 28. Contd…..  SUBORDINATE GOALS: This refers to guiding concepts, values and aspirations that unite an organization in some common purpose.  SYSTEM: This category consists of all the formal and informal procedures that allow the organization to function, including capital budgeting, training, and accounting systems.  SKILLS: It refers to those activities organizations do best and for which they are known.  STYLE: It refers to the pattern of substantive and symbolic actions undertaken by top managers. It communicates priorities more clearly than words and may influence performance.
  • 29. OPERATIONALISING STRATEGY  OPERATIONAL PLANS: Plan that provides details needed to incorporate strategic plans into the organization’s day to day operations.  SINGLE USE PLANS: Detailed course of action used once or only occasionally to solve a problem that does not occur repeatedly.  PROGR AM: A single used plan that covers a relatively large set of organizational activities and specifies major steps, their order and timing, and the unit responsible for each step.  PROJECT: The smaller and separate portions of the program.  BUDGETS: Formal quantitative statements of the resources allocated to specify programs or projects for a
  • 30.  STANDING PLAN: An established set of decisions used by managers to deal with recurring or organizational activities; major types of policies, procedures and rules. POLICY: A standing plan that establishes general guidelines for decision making. RULES: Standing plans that detail specify actions to be taken in a given situation. PROCEDURE: A standing plan that contains detailed guidelines for handling organizational actions that occur regularly.
  • 31. INSTITUTIONALISING STRATEGY  An Institution is a collection of values, norms, roles, and groups that develops to accomplish a certain goal. To emphasize systems, style, staff, skills, and super ordinate goals, we need to look at how strategy is institutionalized. THE ROLE OF THE CEO Chief executive officers(CEOs) spend most of their time developing and guiding strategy their personal goals and values inevitable shape organizational strategy. Their role in strategy formulation makes CEOs especially important to strategy implementation. First they interpret strategy, acting as final judges when managers disagree on implementation. Second, CEOs enact- through their words and actions- the seriousness of an organization’s commitment to a strategy. Third, CEOs motivate, providing intangible incentives
  • 32. THE STRATEGIC MANAGEMENT PROCESS  Strategic management provides a disciplined way for managers to make sense of the environment in which their organization operates, and then to act. Two phases are involved:Strategic Planning: this includes both the goal setting and the strategy formulation process. Strategy Implementation: there is a shift from analysis to administration- the task of achieving predetermined goals.
  • 33. BUSINESS STRATEGIES  LOW COST: Gain a competitive advantage by driving down organizational cost.  Managers manufacture at lower cost, reduce waste.  Lower cost than competition means lower prices.  DIFFERENTIATION: Gain a competitive advantage by making our product different from others.  Differentiation should be valued by customers.  Successful differentiation allows you to charge more for a product.
  • 34. Corporate level Strategies  Concentrate in single business: MC Donald's focuses in the fast food business. • Can become very strong, but can be risky.  Diversification: Organization moves into new business and services. • Related diversification: firm diversifies in similar areas to build upon existing divisions.  Synergy: two divisions work together to obtain more than the sum of each separately.  Unrelated diversification: buy business in new areas. • Build a portfolio of unrelated firms to reduce risk or trouble in one industry
  • 35. “FIVE FORCES” CORPORATE STRATEGY An Organization’s ability to compete in a given market is determined by that organization’s technical and economic resources, as well as by five environmental forces each of which threatens the organization’s venture into a new market. The five forces are: THREAT TO NEW ENTRANTS.  BARGAINING POWER OF BUYERS(CUSTOMERS).  BARGAINING POWER OF SUPPLIERS.  THREAT OF SUBSTITUTE PRODUCTS.  RIVALRY AMONG COMPETITORS.
  • 36. FUNCTIONAL LEVEL STRATEGIES  Seeks to have each department add value to a good or service.  Marketing, service, production all add value to a good or service.  Value is added in two ways:  Lower the operational cost of providing the value in products.  Add new value to the product by differentiating.  Functional strategies must fit with business level strategies.