Planning is a critical management function that involves deciding in advance what to do and how to achieve organizational goals. It includes several types: strategic, tactical, operational, and contingency planning, each serving specific purposes in achieving targeted objectives. The planning process involves multiple steps, such as establishing objectives, developing premises, evaluating alternatives, and requires coordination across all levels of management to ensure effective execution.

2. Planning
 Planning is the fundamental management function, According to Koontz & O’Donell,
“Planning is deciding in advance what to do, how to do and who is to do it. Planning bridges
the gap between where we are to, where we want to go. It makes possible things to occur
which would not otherwise occur”
 It is a preparatory step.
 According to Urwick, “Planning is a mental predisposition to do things in orderly way, to
think before acting and to act in the light of facts rather than guesses”.
 It is an intellectual process which lays down an organisation’s objectives and develops
various courses of action, by which the organization can achieve those objectives. It chalks
out exactly, how to attain a specific goal.

3. Types of Planning
Strategic planning is the art of formulating
business strategies, implementing them, and
evaluating their impact based
on organizational objectives.
Strategic Planning
Tactical Planning
Operational Planning
A tactical plan describes the steps and actions
that must be taken to achieve the goals from
the strategic plan. It is the blueprint of the
larger strategic plan.
An Operational Plan is a highly detailed plan that
provides a clear picture of how a team, section or
department will contribute to the achievement of the
organization's goals. The operational plan maps out
the day-to-day tasks required to run a business.
Contingency Planning
It is defined as a course of action designed to help an
organization respond to an event that may or may not
happen. Contingency plans can also be referred to as
‘Plan B’ because it can work as an alternative action
if things don’t go as planned.

4. Steps of Planning
Step 1:Being Aware of opportunity
 The awareness of opportunities in the external environment as well as within the
organisation is the real starting point for planning.
 All managers should take a preliminary look at possible future opportunities see them
clearly and completely.
 Analyze companies strengths and weaknesses, understanding the problems and its
solutions
 Setting realistic objectives depends on awareness hence, planning requires a realistic
diagnosis of the opportunity situation
Step 2: Establishing Objectives
 The planning function actually begins with the determination of future objectives.
Objectives are established for the entire enterprise and then for each subordinate
work unit.
 Objectives specify the expected results and indicate the end points of what is to be
done, where the emphasis is to be given and what is to be accomplished by the
network of strategies, policies, procedures, rules, budgets and programs.

5. Step 3: Developing Planning Premises
 The next logical step in planning is to establish, circulate and obtain agreement to utilize
critical planning premises such as forecasts, applicable basic policies and existing
company plans.
 Planning premises are the assumptions about the environment in which the plan is to be
carried out. It is important for all managers involved in planning to agree on the
premises.
Step 4: Determining alternative courses
 The fourth step in planning is to search for alternative courses of action for any type of
problem, especially those not immediately apparent. There is seldom plan for which
reasonable alternatives do not exist.
 The most common problem is not finding alternatives but reducing the number of
alternatives so that the most promising may be analyzed.
Step 5: Evaluating alternative courses
 After seeking out alternative courses the planner has to evaluate the alternatives by
weighing them in light of premises and goals. This is done by the quantitative techniques
and operations research.
 The more common problem is not finding alternatives but reducing the number of
alternatives so that the most promising may be analyzed. The planner must usually make
a preliminary examination to discover the most fruitful possibilities.

6. Step 6: Choosing a Best Course of Action
 This is the point at which the plan is adopted- the real point of decision making.
 Occasionally, an analysis and evaluation of alternative courses will disclose that two
or more are advisable, and the manager may decide to follow several course rather
than the one best course.
Step 7: Formulating Supporting Plans
 When the decision is made, planning is seldom complete, it is a derivative plan is to
be made to support the basic plan. It is nothing but the day-to-day operations of the
organisation. Middle and lower level managers must draw up the appropriate plans,
programmes and budgets for their sub-units. These are described as derivative plans.
Step 8: Quantifying plans by budgeting
 After decisions are made and plans are set, it is necessary to numbered them by
converting them into budgets. Overall budgets represent the sum total of income and
expenses with major balance sheet items such as cash and capital expenditures and
resultant profit (or) surplus. Each subunit has its own budgets usually of expenses
and capital expenditures which will come under the overall budget.
 If done well, budgets become a means of adding the various plans and set important
standards against which planning progress can be progressed.

7. Relationship between planning and
controlling
Planning and controlling are inter-related to each other.
Planning sets the goals for the organization and
controlling ensures their accomplishment.
 Planning decides the control process and controlling
provides sound basis for planning.
M.C. Niles, “Control is an aspect and projection of
planning, where as planning sets the course, control
observes deviations from the course, and initiates
action to return to the chosen course or to an
appropriately changed one.”

8.  Planning Originates Controlling: In planning the
objectives or targets are set in order to achieve
these targets control process is needed. So
planning precedes control.
 Controlling Sustains Planning: Controlling directs the
course of planning. Controlling spots the areas where
planning is required
 Controlling Provides Information for Planning: the
actual performance is compared to the standards set and
records the deviations, if any.
 Planning and Control are Forward Looking
No one can control the past, it is the future which can be
controlled. Planning and controlling are concerned with
the achievement of business goals. Their combined
efforts are to reach maximum output with minimum of
cost. Both systematic planning and organized controls
are essential to achieve the organizational goals.
 Planning and Controlling are Interrelated
Planning is the first function of management. Control
records the actual performance and compares it
with standards set. Proper corrective measures
are taken to improve the performance in future.

9. Co-Ordination is the essence of
management
 coordination means bringing together the activities and resources of
organization and bringing harmony in them. Coordination can be defined
as “Synchronization of efforts from the stand-point of time and the
sequence of execution”.
 Coordination is the base or primary function of every manager because
various departments of an organization are working independently and
there is need to relate and integrate their activities.
 Coordination brings unity of action and integrates different activities of
organisation.

10. Coordination is considered as the essence of management because of following reasons :
 Coordination is needed to perform all the functions of management
(i) In planning coordination is required between main plan and supportive plans of different departments.
(ii) In organising coordination is required between different resources of an organization and also between
authority responsibility and accountability.
(iii) In staffing coordination is required between skill of a person and job assigned to him, between efficiency
and compensation etc.
(iv) In directing function coordination is required between superior and subordinates, between orders,
instructions, guidelines and suggestions etc.
(v) In controlling function coordination is required between standards and actual performance.
 Coordination is required at all the levels:
(i) Top level requires coordination to integrate all the activities of organisation and lead the efforts of all the
individuals in one common direction.
(ii) Coordination is required at middle level to balance the activities of different departments so that these can
work as a part of one organisation only.
(iii) Lower level requires coordination to integrate the activities of workers towards achievement of
organisational objectives.
 Coordination is the most important function of an organization:
Any company which fails to coordinate its activities cannot survive and run successfully for a long period of
time.
So in short we can say without coordination no company can work efficiently and earn profit.