DESOLOC, Loriane R. SALES, Jacinto D. VIRTUDAZO, Emmylou A.

Planning in Management
Planning is deciding in advance what to do and how to do. It is one of the basic managerial functions. Before doing something, the manager must formulate an idea of how to work on a particular task. Thus, planning is closely connected with creativity and innovation. It involves setting objectives and developing appropriate courses of action to achieve these objectives.

Planning 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'Donnel.

Importance of Planning
1. Planning increases the organization's ability to adapt to future eventualities: The future is generally uncertain and things are likely to change with the passage of time. The uncertainty is augmented with an increase in the time dimension. With such a rise in uncertainty there is generally a corresponding increase in the alternative courses of action from which a selection must be made. The planning activity provides a systematic approach to the consideration of such future uncertainties and eventualities and the planning of activities in terms of what is likely to happen. 2. Planning helps crystallize objectives: The first step in planning is to fix objectives which will give direction to the activities to be performed. This step focuses attention on the results desired. A proper definition and integration of overall and departmental objectives would result in more coordinated inter-departmental activities and a greater chance of attaining the overall objectives. 3. Planning ensures relatedness among decisions: A crystallization of objectives as mentioned above would lead to relatedness among the decisions which would otherwise have been random. Decisions of the managers are related to each other and ultimately towards the goals or objectives of the enterprise. Creativity and innovation of individuals is thus harnessed towards a more effective management of the company. 4. Planning helps the company to remain more competitive in its industry: Planning may suggest the addition of a new line of products, changes in the methods of operation, a better identification of customer needs and segmentation and timely expansion of plant capacity all of which render the company better fitted to meet the inroads of competition. 5. Adequate planning reduces unnecessary pressures of immediacy: If activities are not properly planned in anticipation of what is likely to happen, pressures will be exerted to achieve certain results immediately or a in a hurry. Thus adequate planning supplies orderliness and avoids unnecessary pressures. 6. Planning reduces mistakes and oversights: Although mistakes cannot be entirely obviated, they can certainly be reduced through proper planning. 7. Planning ensures a more productive use of the organization's resources: By avoiding wasted effort in terms of men, money and machinery, adequate planning results in greater productivity through a better utilization of the resources available to the organization.

DESOLOC, Loriane R. SALES, Jacinto D. VIRTUDAZO, Emmylou A.

8. Planning makes control easier: The crystallization of objectives and goals simplify and highlight the controls required. 9. Planning enables the identification of future problems and makes it possible to provide for such contingencies. 10. Planning can help the organization secure a better position or standing:Adequate planning would stimulate improvements in terms of the opportunities available. 11. Planning enables the organization to progress in the manner considered most suitable by its management: Management, for example, may be interested in stability and moderate profits rather than huge profits and risk of instability. In terms of its objectives, the plan would ensure the actions are taken to achieve such objectives. 12. Planning increases the effectiveness of a manager: As his goals are made clearer, adequate planning would help the manager in deciding upon the most appropriate act.

Features of planning

Planning focuses on achieving objectives Planning is a primary function of management Planning is pervasive Planning is continuous Planning is futuristic Planning involves decision making Planning is a mental exercise

Planning Process
Setting objectives: Objectives may be set for the entire organization and each department or unit within the organization. Developing premises: Planning is concerned with the future which is uncertain and every planner is using conjuncture about what might happen in future. Identifying alternative courses of action: Once objectives are set, assumptions are made. Then the next step would be to act upon them. Evaluating alternative courses: The next step is to weigh the pros and cons of each alternative. Selecting an alternative: This is the real point of decision-making. The best plan has to be adopted and implemented. Implement the plan: This is concerned with putting the plan into action. Follow-up action: Monitoring the plans are equally important to ensure that objectives are achieved.

Types of Plans

DESOLOC, Loriane R. SALES, Jacinto D. VIRTUDAZO, Emmylou A.

Objectives: Objectives are very basic to the organization and they are defined as ends which the management seeks to achieve by its operations. They serve as a guide for overall business planning. Strategy: strategy is a comprehensive plan for accomplishing an organizations objectives. This comprehensive plan will include three dimensions, (a) determining long term objectives, (b) adopting a particular course of action, and (c) allocating resources necessary to achieve the objective. Policy: They are guides to managerial action and decisions in the implementation of strategy. Procedure: Procedures are routine steps on how to carry out activities. Procedures are specified steps to be followed in particular circumstances. Method: Methods provide the prescribed ways or manner in which a task has to be performed considering the objective. It deals with a task comprising one step of a procedure and specifies how this step is to be performed. Rule: Rules are specific statements that inform what is to be done. They do not allow for any flexibility or discretion. Program: Programs are detailed statements about a project which outlines the objectives, policies, procedures, rules, tasks, human and physical resources required and the budget to implement any course of action. Budget: It is a plan which quantifies future facts and figures. It is a fundamental planning instrument in many organizations.

Planning Principles
Planning is a dynamic process, it is very essential for every organization to achieve their ultimate goals, but, there are certain principles which are essential to be followed so as to formulate a sound plan. They are only guidelines in the formulation and implementation of plans. These principles are as follows: 1. Principle of Contribution: The purpose of planning is to ensure the effective and efficient achievement of corporate objectives. In fact, the basic criteria for the formulation of plans are to achieve the ultimate Objectives of the company. The accomplishment of the objectives always depends on the soundness of plans and the adequate amount of contribution of company towards the same. 2. Principle of Sound and Consistent Premising: Premises are the assumptions regarding the environmental forces like economic and market conditions, social, political, legal and cultural

DESOLOC, Loriane R. SALES, Jacinto D. VIRTUDAZO, Emmylou A.

aspects, competitors actions, etc. These are prevalent during the period of the implementation of plans. Hence, Plans are made on the basis of premises accordingly, and the future of the company depends on the soundness of plans they make so as to face the state of premises. Principle of Limiting factors: The limiting factors are the lack of motivated employees, shortage of trained personnel, shortage of capital funds, government policy of price regulation, etc. The company requires monitoring all these factors and needs to tackle the same in an efficient way so as to make a smooth way for the achievement of its ultimate objectives. Principle of Commitment: A commitment is required to carry-on the business that is established. The planning shall has to be in such a way that the product diversification should encompass the particular period during which entire investment on that product is recovered. Principle of Coordinated Planning: Long and short-range plans should be coordinated with one another to form an integrated plan, this is possible only when latter are derived from the former. Implementation of the long-range plan is regarded as contributing to the implementation of the short-range plan. functional plans of the company too should contribute to all others plans i.e. implementation of one plan should contribute to all the other plans, this is possible only when all plans are consistent with one another and are viewed as parts of an integrated corporate plan. Principle of Timing: Number of major and minor plans of the organization should be arranged in a systematic manner. The plans should be arranged in a time hierarchy, initiation and completion of those plans should be clearly determined. Principle of Efficiency: Cost of planning constitutes human, physical and financial resources for their formulation and implementation as well. Minimizing the cost and achieving the efficient utilization of resources shall has to be the aim of the plans. Cost of plan formulation and implementation, in any case, should not exceed the organizations output's monetary value. Employee satisfaction and development, and social standing of the organization are supposed to be considered while calculating the cost and benefits of plan. Principle of Flexibility: Plans are supposed to be flexible to favor the organization to cope-up with the unexpected environments. It is always required to keep in mind that future will be different in actuality. Hence companies, therefore, requires preparation of contingency plans which may be put into operation in response to the situations. Principle of Navigational Change: Since the environment is always not the same as predicted, plans should be reviewed periodically. This may require changes in strategies, objectives, policies and programs of the organization. The management should take all the necessary steps while reviewing the plans so that they efficiently achieve the ultimate goals of the organization. Principle of Acceptance: Plans should be understood and accepted by the employees, since the successful implementation of plans requires the willingness and cooperative efforts from them. Communication also plays a crucial role in gaining the employee understanding and acceptance of the plans by removing their doubts and misunderstanding about the plans also their apprehensions and anxieties about consequences of plans for achievement of their personal goal.

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