Planning

Planning means deciding future course of action., i.e. making plans for attaining
organisations objectives. But the plans alone cannot attain objectives. Matching
resources and actions are needed to attain objectives.
According to George R. Terry, Planning is method or technique of looking ahead,
a constructive reviewing of future, so that present actions can be adjusted in view
of established goals.
Features of Planning1) Determination of Objectives- Planning facilitates the attainment of
objectives of an organization through deciding steps for achievement of the
same.
2) Primacy of Planning- Planning is often called the first among equals of the
five management functions ( planning, organizing, directing, staffing and
controlling) because it starts with objectives which are for should be the
basis of all the functions.
3) Forward Looking- Planning involves the determination of future course of
action. Planning is deciding in advance what to do, when to do it and who is
to do it.
4) Pervasiveness- Planning is required at all levels within the firm. Strategic
planning is the task of top management while tactical and operational
planning is the concern of middle and lower management respectively.
Therefore, planning is a pervasive activity covering entire enterprise with all
its segments and every lend of its management.
5) Involves choice- Planning cannot be imagined in the absence of alternatives.
If there are alternatives, then there is a need for evaluation of all the
alternatives. And finally, one of the alternatives is selected fro
implementation. Planning is essentially decision- making since. It involves
choosing among alternatives.
6) Continuous Process- Planning is an ongoing process. As environment is
changing so fast that if we continue with one best way of doing things then
we will be losing the market. Every business person has to be in touch with
the changing environment and continue to make changes as and when
required.

7) Intellectual process- Planning is a mental process and therefore planning job

must be separated from operational work. Planning is an outcome of mental
exercise involving imagination, foresight and sound judgement. It is neither
guesswork and wishful thinking.
Importance of Planning1) Offsetting uncertainty and change- Planning is necessary because of future
uncertainty and change. One can hardly be certain about future events.
2) Focusing attention on objectives- Planning is directed towards the objectives
of business undertaking. Therefore, the attention of every manager is
focused on these objectives in the very course of performing their respective
planning functions.
3) Gaining economical operation- Planning works for efficiency and economy
in operation. Planning is concerned with the predetermined and well thought
out courses of action. Therefore, it helps in avoiding chaos, confusion,
disorder and therefore waste of resources.
4) Facilitating Control- Plans provide standards for controlling employees
performance. Executives cannot have check on the accomplishment of their
subordinate without planned goals. The function of controlling is based on
comparison between the planned goals and the actual performance of
subordinates. There is no way to exercise control without plans to use as
standards.
5) Encourages innovation and creativity- Planning is thinking in advance and
therefore there is a scope of finding better and different methods and
procedures to achieve desired objectives.
Elements of PlanningA plan has the following elements:1. Aim- Any organisation should have definite aim. The aim should be clearly
defined so that it can guide and direct the activities of the enterprise. The main aim
of a cooperative organisation is to do service and to improve the economic
conditions of members.

2. Objectives- Webster's Dictionary defines objectives as "that towards which

effort is directed or end of action or goal". Hence objectives or goals may be
described as the ends towards which the group activities are aimed.
People say "Effective management is management by objectives". A cooperative
organisation can have sub-objectives for each department or sections and they can
be united to have board based objective.
3. Policies- A policy is a verbal, written or implied basic guide that provides
direction to a manager for action. Policies guide the actions of an organization's
performance and its objectives in the various areas of operation.
4. Procedures- Procedures spell out the actions to be taken out in practice to
achieve the organizations objectives as stated in the policies. Procedures may be
static or changed often. Organizations have set procedures for procuring raw
materials, recruitment of personnel etc.
5. Methods- Methods are work plans, since they provide the manner and order,
keeping the objectives, time and facilities available. Methods involve only one
department and one person. They contribute to the efficiency in working and help
work planning and control. Methods are used in manufacturing, marketing and
office work.
6. Rules- Rules are different from procedures and policies. A rule requires a
specific and definite action be taken or not taken with respect to a situation. Rules
do not allow any discretion in their application. Also they do not allow any
leniency to come in the way of their application.
7. Budget- Budget is essentially a plan expressed in quantitative terms. Budgets
involve both planning and control element. Like the plan, budget is flexible,
realistic and operates within a framework. A budget is differentiated from other
plans in the following respects:a. It is a tool for planning and control.
b. A budget covers specific period.
c. Budget is expressed in financial terms.
8. Programmes- Programmes show the way and lay down procedure for activities
to take place within a time limit for accomplishing, the stated objectives. The

constituents of a programme are objectives, policies, procedures, rules, methods

and resources to be made use for obtaining the objectives. Programmes enable the
management to anticipate and prepare them ahead to meet future eventualities.
9. Strategies:
Koontz and O'Donnell consider this as an important planning element. "Strategy
concerns the direction in which human and physical resources will be deployed
and applied in order to maximize the chance of achieving a selected objective in
the face of difficulties".
Process of PlanningPlanning is not an event rather it is a process consisting series of steps. These steps
may vary from situation to situation. However the following steps are common in
the formulation of plan1)