Full explanation of planning function. This is the first function of management. Explanation by Imran Khan

1. PLANNING
IMRAN KHAN (PGT)
www.imransirsuccesspoint.in

2. PLANNING
 Planning is the fundamental management function, which involves deciding
beforehand, what is to be done, when is it to be done, how it is to be done and who is
going to do it.
 It is an intellectual process which lays down an organisation’s objectives and
develops various courses of action, by which the organisation can achieve those
objectives
 Planning is nothing but thinking before the action takes place.
 Planning is deciding a path to be followed to reach a destination or to achieve a
targets.
 Planning bridges the gap between today and future.
 Every organisation whether it is government owned or privately owned requires
planning. The government prepares five year plans for the country, big or small all
companies have to plan to achieve organizational objective.

3. Where we are Where we
want to go

4. Features of Planning
 Planning focuses on achieving objective:-It focuses on defining the goals of the
organisation, identifying alternative courses of action and deciding the appropriate
action plan, which is to be undertaken for reaching the goals.
 Planning is a primary function of management:-Planning is a first and foremost
managerial function provides the base for other functions of the management, i.e.
organising, staffing, directing and controlling, as they are performed within the
periphery of the plans made.
 Planning is pervasive:-It is pervasive in the sense that it is present in all the
segments and is required at all the levels of the organisation. Although the scope of
planning varies at different levels and departments.
 Management-Planning =Zero
 Planning is continuous:-Plans are made for a specific term, say for a month,
quarter, year and so on. Once that period is over, new plans are drawn, considering
the organisation’s present and future requirements and conditions. Therefore, it is
an ongoing process, as the plans are framed, executed and followed by another
plan.

5.  Planning is futuristic:-In the process of planning we take a sneak peek of the future.
It encompasses looking into the future, to analyse and predict it so that the
organisation can face future challenges effectively.
 Planning involves decision making:-Decisions are made regarding the choice of
alternative courses of action that can be undertaken to reach the goal. The alternative
chosen should be best among all, with the least number of the negative and highest
number of positive outcomes.
 Planning is a mental exercise:-It is a mental exercise at it involves the application of
mind, to think, forecast, imagine intelligently and innovate etc.

6. Importance of Planning
 Planning provides direction:-Planning helps the organisation to keep on the right path. It
provides definite direction to manager to decide what to do and when to do it.
 Planning reduces risks of uncertainty:-It helps organisation to predict future events and
prepare to take necessary actions against unexpected events. It is helpful in assessing and
meeting future challenges.
 Planning reduces overlapping and wastefull activities.:-Planning makes the task of
managing more efficient and effective manner. It helps to minimize the cost of operations and
improves the competitive strength of an organisation.
 Planning promotes innovative ideas:-Planning compels the managers to be creative and
innovative all the time. It forces managers to find out new and improved ways of doing things
in order to remain competitive and avoid the threats in the environment.
 Planning facilitates decision making:-Planned targets serve as the criteria for the evaluation
of different alternatives so that the best one may be chosen with the help of planning hasty
decisions and random actions can be avoided.
 Planning standards for controlling:-Planning provides the standard against which the actual
performance can be measured and evaluated. There is nothing to control without planning and
without proper control. Plans serve as yardsticks for measuring performance.

7. Limitation of Planning
 Planning creates rigidity:- Though plans are prepared for the future but they draw framework
for managers to follow a specific path with an aim to achieve specific goals within a
predetermined time period.
 Planning does not work in a dynamic environment:-The dimensions of business environment
are ever changing and business enterprises have to adapt all the changes as and when they
happen.
 Planning reduces creativity:-Usually plans are drafted by a group of people at top level
management and implemented by all. AT middle and supervisory level of management the
manager are responsible for execution of plans, they are neither consulted while drafting the
plans nor allowed to deviate from the framework.
 Planning is a time consuming process:-Formulation of plans requires collection and analysis
of data, discussions with professionals, top level management or any other concerned people.
All this involves lot of time.
 Planning does not guarantee success:- Sometimes the managers think that planning solves all
their problems. Such a thinking makes them neglect their real work and the adverse effect of
such an attitude has to be faced by the organisation.
 Planning involves huge cost:-Planning is a small work but its process is really big. Planning
becomes meaningful only after traversing a long path.

8. Process of Planning
 S
 D
 I
 E
 S
 I
 F

9. Setting Objectives:-
 Objectives are those end points for whose attainment all the activities are undertaken.
 Every business organisation must establish general and specific objectives, goals,
short term and long term targets not only for the organisation but for each department,
each division and in fact for each employee of the organisation.
 For example:- Total business growth by 25% could be an organisational objective
which can be further divided into targets for sales departments, production department
and for each individual working in the respective department.

10. DEVELOPING PREMISES
 Premises means to make certain assumption about the future.
 Planning is futuristic it has to depend on certain assumption of what might happen in the
future.
 Premises may include forecast, existing plan, policies, or practice followed in the past
etc.
 The base of planning are those factors/ assumption which influences the possible result
of different alternatives.
 For successful and effective planning it is a must that all the managers involved in
planning understand and agree with the assumption or Premises.
 Premises are of two types
 1. Internal Premises:- Capital, Labour, Raw Material, Machinery etc.
 2. External Premises:- Government Policies, Business competition, taste of customer,
rate of taxes, rate of interest etc.

11. IDENTIFYING ALTERNATIVE COURSE
OF ACTION
 There is no work which has no alternative method of doing it.
 On the basis of the objectives of the organisation and the limitation of planning,
alternative course of doing a particular work can be discovered.
 For example:- If an organisation has the object of expanding its business, it can be
done in many ways like
 1. By expanding the existing business.
 2. By entering other area of production
 3. By entering into some collaboration with some other organisation and start a new
business.

12. EVALUATING AN ALTERNATIVE
 To achieve objective most efficiently it is must that the best course of action is
followed.
 In this step of planning the already identified alternative courses of action are
evaluated.
 It is important the alternative course of action are compared with their respective
negative and positive, their contribution towards achievement of oranisational goal,
their feasibility and viability.
SELECT AN ALTERNATIVE
 After a careful analysis of different alternatives the best one is selected.
 This is the real point of planning and decision making.
 We must select an alternative which is most feasible, profitable and has least negative
consequences but manager’s experience, personal judgment and intuitions must also
be considered while making final decision.

13. IMPLEMENTING THE PLAN
 After having decided the chief plan and the subsidiary plans, they are to be
implemented.
 It is the step where directions provided through planning are converted into actions.
 For example:- Once the production manager finalizes the machinery to be installed
then it would require purchasing of machinery, organising raw material, appointing
appropriate workforce etc.
FOLLOW UP ACTION
 The process of planning does not end with the implementation of plans.
 Plans are formulated for future which is uncertain. It is of great importance that there
is a constant review of plans so as to ensure success in the uncertain future.

14. TYPES OF PLANS
TYPES OF PLANS
Single use
plan
Standing
plans
Metho
d
Budget
Programme
Objective
Strategy
Policy
Procedure
Rule

15. SINGLE USE PLAN
 As the name suggests, single use plans are the one time plans designed to achieve specific goals
or objectives.
 These Plans are the short term plans formulated by middle level or lower level management to
achieve specific goals.
 Features of Single use plans are:-
 These plans apply to non recurring or non repetitive activities.
 The are flexible and can be changed as per the conditions of the organisation.
 These plans are prepared to meet the needs of a unique situation.
 These plans cannot be used again.
 The duration of plans depends on the activity for which they are formulated.
 Types of Single use Plans:-
 Method:-It is the prescribed way in which a specific tasks has to be performed with an aim to
achieve its objective most efficiently. For example:- On the job training , Production tech.
 Budget:- It is a statement which forecast the expected results of a specific task to be performed
in the future. For exam. The top level management sets annual targets to all depar.
 Programme: It is a detailed statement which outlines the objectives, policies, procedure, rules,
tasks etc. related to a special task. For exam. Preparing detailed plan for new academic year.

16. STANDING PLANS
 Standing plans are the plans, which focus on organisational situations occurring
repeatedly.
 They are the long term plans formulated by the top level management with an aim to
achieve primary goals of the organisation.
 Features of Standing plans are:-
 These plans are applicable to situations which repeat themselves.
 These plans can be used again and again.
 These plans are static and cannot be changed.
 These plans are prepared once and retain their value over a period of time with updates
and revisions.
 For example: Employees recruitment process, business development plan, wages
structure of the company etc.

17. Types of Standing Plans
 Objectives:-
 1. Objective are the end result which the management seeks to achieve through its
operation.
 2. It focus on broad and general issue.
 3. Objectives are formulated or set up by the top level management.
 4. It acts as a guide while planning for the entire organisation.
 Strategy:-
 1. Determining long term objectives.
 2. Adopting a particular course of action.
 3. Allocating resources necessary to achieve the objectives.
 Policy:-
 1. Policies are the basis for interpretation of generally stated strategies.
 2. It is the guidelines to managerial actions and decision while implementing policies.
 3. Policies are formulated for all levels and all departments in the organisation.

18.  Procedure:-
 1. Procedure state the sequential or chronological steps to be followed while
carrying out an activity within the broad policy framework.
 2.Procedure are prepared with an aim to enforce a policy and to achieve the
organisational goals.
 3. Procedure are usually drafted for the efficiency of internal management.
 Rule:-
 1. Rules are the specific statements which inform what managerial action must be
taken and what must not be taken in a given situation.
 2. Rules being specific do not allow any flexibility or discretion.
 3. Rules prescribe rewards, penalties or fines if policy , procedure or rule is
violated.
 4. They are formed with in the policy framework and do not change unless there is
change in the policy.

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