Planning

Management Process is:

Management Process:Planning: It is the basic function of management. It deals with chalking out a future course of action & deciding in advance the most appropriate course of actions for achievement of pre-determined goals. Decision making is an integral part of PlanningPrinciple of navigational changeA plan must be flexible

Organizing: It is the process of bringing together physical, financial and human resources and developing productive relationship amongst them for achievement of organizational goals.

Staffing: It is the function of manning the organization structure and keeping it manned.

Management Process:Directing: It is that part of managerial function which actuates the organizational methods to work efficiently for achievement of organizational purposes. Controlling: It implies measurement of accomplishment against the standards and correction of deviation if any to ensure achievement of organizational goals.

PlanningPlanning includes all the activities that lead to the definition of objectives and to the determination of appropriate courses of action to achieve those objectives.

Planning helps us answer:What to do?Where to do it?How will we do it?Who will do the task?And.When will we do it?

The need for planning:Increasing Organizational complexityLeads to successFocus attention on organizational goalsFacilitates control

Importance of PlanningPlanning Clarifies the objectives of the organization.Planning economizes operations.Planning precedes controlPlanning provides for the futurePlanning increases the efficiency of all the managerial functions.

Types of Plans

Vision MissionObjectivesStrategiesOperational PlansSingle use plansStanding plans

VISIONTop of this hierarchy is vision. This is the dream than an entrepreneur creates about the direction that his business should pursue in future.A vision should be brief focused, clear and inspirational to the organizations employees

MISSIONUnique aim of an organization that sets it apart from others of its type.It describes the scope of the businessThe Mission of ABB Ltd is to be a global leader.. Most competitive, competent, technologically advanced, and quality minded electrical engineering company

Like vision, a firms mission also guides the development of strategies. It establishes the context within which daily operating decisions are made . And thus they are not revised every now & then in response to every new turn in the economy.

ObjectivesObjectives are goals or aims that the management wishes to achieve in the pursuit of its missionThese are the end points towards which all activities like organizing, staffing, directing and controlling are directed. Only after having these end points can the manager determine the kind of organization, the kind of personnel, their qualification, the kind of motivation, the supervision, he must employ to reach these points

Contd..Objectives are different from purpose.Purpose is the primary role of any organizationObjectives are specific targets to be reached by an organization.Translation of organizations mission into concrete terms .

Contd..Objectives have a priorityObjectives are generally arranged in a hierarchy

Requirements of sound objectivesObjectives must be both clear and acceptableObjectives must support one anotherObjectives must be precise and measurableObjectives should always remain valid

Advantages of ObjectivesProvide basis for planningAct as motivatorsEliminate haphazard actionFacilitate coordinated behaviorA basis for managerial controlLessen misunderstanding & conflictFacilitate better management

StrategiesA term originated in military, which connotes a response to a competitive environmentSWOT analysis is necessary2 important activities involved in strategy formulation are environmental appraisal and corporate appraisal

Environmental AppraisalResult in the identification of Threats & OpportunitiesSome Environmental factors are:Political & Legal FactorsEconomic PoliciesCompetitive FactorsSocial & Cultural Factors

Political & Legal factorsStability of the govt. & its political philosophyTaxation & industrial licensing lawsMonetary & Fiscal Policies

ECONOMIC FACTORSLevel of Economic DevelopmentDistribution of Personal IncomeTrends in prices, exchange rates,Supply of raw material , labour and capital

Competitive factorsIdentification of principal competitorsAnalysis of their performance & programmes

Social and cultural Factors Literacy levelReligious and social characteristicsRate of urbanizationRate of social change

Corporate AppraisalThis involves analysis of companys strengths or weaknesses.Strengths may lie in outstanding leadership, excellent product design, low cost manufacturing, efficient distribution , efficient customer service,.

Operational PlansStanding PlansAre plans designed for situation that recur often enough to justify a standardized approach. Eg. Plan for processing a loan application

Single Use Plan:Are developed to achieve specific end. When the pln is achieved, plan is dissolved.

Standing PlansObjectives: They are goals established to guide the efforts of the company and each of its components. They are the end point of the management programme. An objective indicates the end result the management wishes to achieve in the long run.

Standing PlansPolicy: A policy is a basic statement that guides decision making. It tells us what we may or may not do. It directs the way in which the activities are to be achieved. It is concerned with how of administrative action.They allow a more refined and flexible approach to recurring problems. They help in achieving co-ordination.

Standing PlansProcedures: They are well thought out courses of action. It prescribes the specific way in which piece of work is to be done. They are also called action guidelines.They are generally derived from policies.The emphasis is on chronological, step by step sequence of required action.

Standing PlansMethods: they are sub units of procedures; they show clearly show a step of the procedure should be performed. They indicate the techniques to be employed to make the procedure effective.The primary focus is on finding the best way on doing a piece of work.Methods cover limited territory, normally one department.

Standing PlansRules: They are very specific and detailed guide to action. It is established in a fairly narrow manner. There is no scope for discretion or judgment.Rules must be followed precisely and observed strictly.

Single Use PlansProgramme: it is a comprehensive plan that include a complex set of goals, procedures, rules, work assignment resource flow and generally cover a large territory.

Single Use PlansSchedule: it is a kind of time table of work, specifying the date when a task is to begin and time needed to complete each task.They are often combined with programmes to ensure a chronological sequence of activities.

Single Use PlansProjects: A small programme is known as project. Budget: is a monetary plan designed primarily to allocate the resources of an organization. It is a blue print of future course of action in monetary terms.

Limitations of PlanningPlanning premises may be wrongRapidity of changeTime and cost constraintsPlanning may limit new ideasCapital investment constraintLack of control over external factors

Planning Process

Establishing ObjectivesIt is the first step.Identify the objectives that we want to achieve.They must be clear and concise, must indicate what is to be achieved, where the action should take place, who is to perform it, how it must be undertaken and when it is to be accomplished.

Developing PremisesPremises are assumptions about the environment in which plans are made and implemented.These assumptions are the likely impact of important environmental factors.

Evaluating alternatives and selectionThere can be multiple courses of action to one plan.The pros and cons of each alternative needs to considered.This needs to be done before a decision is made.

Formulating derivative plansThe formulation of secondary plans to support the primary plans.To ensure the success of primary plan, the derivative plans must indicate the time schedule and sequence of performing various tasks.

Securing Cooperation and ParticipationThe successful implementation of a plan depends on a huge extent on the whole hearted cooperation of the employees. Management also needs to be involved in this process.

Providing for Follow-UpPlans need to reviewed continually to ensure their relevance and effectiveness.In course of implementation facts may crop up that were not taken care of before.This changes need to made while implementing the plan.