CHAPTER-1

NATURE OF MANAGEMENT

Management is a distinct activity having the following salient features or

characteristics:

1. Goal Oriented:
The purpose of the management is to achieve the goals of the organization. For
instance, management of a business aims at satisfaction of customers, earning
of profits and increasing the goodwill and image of the business.
2. Economic Resources:
Management is one of the factors of production together with land, labour, and
capital. It is the force which assembles and integrates these factors towards the
production of goods and services required to the society.
3. Distinct Process:
Management is a distinct process consisting of such functions as planning,
organizing, staffing , directing and controlling. In essence, the process of
management involves decision-making and putting decisions into practice.
4. Integrative Force:
The essence of management is integration of human and other resources to
achieve the desired objectives.
5. Intangible Force:
Management has been called an unseen force. Its presence is evidenced by the
result of its efforts – orderliness, informed employees, team spirit and adequate
work output.
6. Results through Others:
The management cannot do everything themselves. They must have the
necessary abilities and skills to get work done through the efforts of others.
7. A science or an Art:
Management has an organized body of knowledge consisting of well-defied
concepts, principles and techniques which have wide applications. So it is
treated as a science. The application of these concepts, principles and
techniques requires specialized knowledge and skills on the part of the
manager. So it is treated as an art.
8. System of Authority:
Management as a te am of managers represents a system of authority, a
hierarchy of command and control.
9. Multi-disciplinary:
Management has grown as a field of study(i.e. discipline) taking the help of so
many other disciplines such as Engineering, Anthropology, Sociology and
Psychology.
10.Universal Application:
Management is universal in character. The principles and techniques of
management are equally applicable in the fields of business, education,
military, government and hospital
 Objectives of Management:

The main purpose of management of a business is to earn reasonable profit by

producing and supplying wants satisfying products for the society. With this end
in view, management pursues the following objectives or goals.

1. Effective Utilization of resources: Management is concerned width the

effective utilization of human resources, capital, machines and equipment,
materials etc., so as to produce the goods required by the customers.

2. Higher Efficiency: Management seeks to obtain maximum output with

minimum resources and efforts. The factors of production are utilized in such
a way that waste of time, effort and energy is minimized. There is a focus on
higher productivity of the organization.

3. Customer Satisfaction: Management seeks to delight the customers by

providing them goods of required quality and attending to the complaints
speedily. There is no doubt about the fact that the customer satisfaction is
essential for the survival and growth of the business.

4. Co-operative work force: Management must attempt to build a team of

workers who are happy and satisfied with the organization. It must ensure to
the workforce to achieve their full co-operation in producing quality product
for the customers.

5. Reasonable Return on Capital: Management must ensure reasonable rate of

return for the shareholders or owners of the business. If it is not so, the supply
of capital to the business will be restricted in the future.

6. Better Relations: Management seeks to build better relations with customers,

investors, suppliers of materials, financial institution and the community. This
is essential to enhance the public image of the business.

7. Contribution to National Goals: Management must be concerned about the

national goals. It should make the efficient use of the scarce re sources. It
should undertake ventures which lead to employment generation and
improvement of the standard of living of the people. It should also contribute
towards the improvement of the surrounding areas where the business unit is
located
Significance of Management

Peter F. Drucker referred to the management as the dynamic life -giving element of
every business enterprise. Management is not only the thinking organ of business
but also the integrating force for the accomplishment of business objective s. The
importance of management to a modern business is discussed below :

1. Determination of Objectives: It is the management which determines the

goals of the organization. They are put in writing and communicate
to all employees to seek their cooperation. All organizational activities are
directed towards the organizational objectives. Clear-cut definition of goals
is essential for the success of any organization.
2. Optimum Utilization of Resources:
Management ensures optimum utilization of resources. On the basis of
planning and forecasting management eliminates all types of wastages and
achieve efficiency in all the business operations. Management motivates
workers to put their best performance. Thus, management results in the
effective running of the business.
3. Integration of Resources:
Management deals wit integration of human and non-human resources in
order to achieve organizational objectives. It directs and coordinates the
activities of individuals on the use of materials, methods and machines for
the achievement of goals of the organization.
4. Sound Organisation:
Management establishes sound organization for the accomplishment of the
desired objectives. It clarifies authority- responsibility relationships among
various positions in the enterprise. It fills various positions with persons
having the right qualifications and training. Management also provides the
workers with proper environment and encourages the spirit of co-operation.
5. M eeting Challenges:
Management keeps itself in touch with the external environment and
supplies foresight to the enterprise. It helps in predicting what is going to
happen in future which will influence the working of the enterprise. It also
takes steps to ensure that the enterprise is able to meet the demands of
changing environment.
6. Economic Growth and Prosperity:
Efficient management of resources is equally important at the national level.
According to Peter Drucker, “The development of a country virtually depends
upon the quality of management of its resources. Efficient management o
resources is a key to the growth of an economic prosperity and better
standard of living of the general public

MANAGERIAL SKILLS
There are three different types of skills required by managers in an organization:
They are: a) Conceptual Skills
b) Human Skills
c) Technical Skills.

a) Conceptual Skills:
It is the ability to see the organization as a whole, to recognize inter-
relationships among different functions of the business and external forces and to
guide effectively. These skills deal with ideas. The conceptual skill is necessary
for taking decision.
b) Human Skills:
Human skills are essential to work with others and achieve their
Cooperation.
C) Technical skills:
Technical skills are developed by formal education a person gets and
by the actual practice on the job.
For example – Such skills are learnt by the managers, accountants
and engineers.

SKILLS REQUIREMENT AT DIFFERENT M ANAGERIAL LEVELS:

1. Top level requires more conceptual skills.

2. Middle level requires more Human Skills.
3. Lower level requires more Technical Skills.

MANAGEMENT AS AN ACTIVITY

Management is an essential activity in any organized group to enable it to achieve

group objectives. It can be distinguished from other activities on the basis of following
features:

(i) Management is goal-oriented.

(ii) It requires performance of managerial functions to achieve the goals.
(iii) It is an essential part of an organization concerned with decision-making
and their implementation.
Management is what manager does, i.e., effective utilization of various resources of
the porgnisation for the accomplishment of the organizational objectives. In other
words, Management as an activity signifies, the roles played by the managers.

The roles are activities performed by the managers may be classified into three
categories: (i) Informational activities (ii) Decisional activities (iii) Interpersonal
activities. These are described below:
 1. Informational Activities: Every manager is engaged in receiving information
from various sources and giving necessary information to superiors, subordinates
and even the outsiders. The informational relate to:
a) Collection and preservation of information.
b) Sharing o information with the superior and subordinates and colleagues
and also with suppliers, customers etc.,
c) Maintenance of goods relations with the n public, other organization,
government etc.,
2. Decisional Activities: Decision making is inherent in the job managers. It
involves:
a) Setting goals of the unit.
b) Formulation of plans, budgets, schedules etc.,
c) Integration of various activities.
d) Controlling of various activities.
3. Interpersonal Activities: These are concerned with the maintenance of good
human relations in the organization. These include:
a) Effective communication with co-managers, superiors, subordinates and
others.
b) Supervision of subordinates.
c) Providing leadership or guidance to the subordinates.
d) Motivation of the subordinates by offering various incentives.

ACTIVITIES OF MANAGERS

Informational Decisional Inter-personal

Activities Activities Activities
*Receiving information *Goal Setting *Communication
*Giving information *Planning *Supervision
*Public Relations *Integration *Leadership
*Controlling *Motivation

MANAGERIAL SKILLS

There are three different types of skills required by managers in an organization:

They are: a) Conceptual Skills
b) Human Skills
c) Technical Skills.

8. Conceptual Skills:
It is the ability to see the organization as a whole, to recognize inter-
relationships among different functions of the business and external forces and to
guide effectively. These skills deal with ideas. The conceptual skill is necessary
for taking decision.
9. Human Skills:
Human skills are essential to work with others and achieve their
 Cooperation.
D) Technical skills:
Technical skills are developed by formal education a person gets and
by the actual practice on the job.
For example – Such skills are learnt by the managers, accountants
and engineers.
Function of M anagement

1. Planning
2. Organizing
3. Staffing
4. Directing
5. Controling

SKILLS REQUIREMENT AT DIFFERENT M ANAGERIAL LEVELS:

1. Top level requires more conceptual skills.

2. Middle level requires more Human Skills.
3. Lower level requires more Technical Skills.

LEVELS OF MANAGEMENT
There are three levels of management as listed below:

(i) Top Management.

(ii) Middle management.
(iii) Supervisory or lower level management

Top Management

The roles and functions of top management are as under:

1. Top management determines the objectives of the enterprise.
2. IT prepares strategic plans and policies for the enterprise.
3. It appoints the executives for the middle level.
4. It issues necessary instructions for the preparation of department budgets,
schedules, procedures, etc.
5. It controls the activities of all departments with the help of reports,
memoranda, etc.
6. It builds and maintains relations with the outside public i.e., financial
institutions, suppliers, government departments, media, etc.

Middle Management

The managers at the middle level generally perform the following functions and roles:
1. They execute the plans of the organization in accordance with the policies of
the top management.
2. They make plans and budgets for the sub-units of the organization.
3. They participate in the employment and training of lower level managers
 4. They assign duties among the junior level managers and give them necessary
instructions.
5. They evaluate the performance of junior managers.
6. They attempt to achieve coordination within their departments and also with
other departments.
7. They submit progress and other important data to the top management.

Supervisory or Lower Level Management

The functions and roles of supervisory executives are as under:

(i) They implement the top management policies communicated to them through
the middle management.
(ii) They plan and organize the activities of their units.
(iii) They arrange for necessary materials, machines, tools, etc., for the workers
and provide them with the necessary working environment.
(iv) They provide training to the workers under their charge.
(v) They maintain good human relations in their units.
(vi) They communicate workers’ problems to the higher level management.
(vii) They send periodical progress reports to their seniors who are part of middle
level management.
Role of manager
Mintzberg published his Ten Management Roles in his book, "Mintzberg on Management: Inside
our Strange World of Organizations," in 1990.
The ten roles are:
1. Figurehead.
2. Leader.
3. Liaison.
4. Monitor.
5. Disseminator.
6. Spokesperson.
7. Entrepreneur.
8. Disturbance Handler.
9. Resource Allocator.
10. Negotiator.
The job (role) of a project manager is extremely challenging and thereby exciting. Depending
on the organizational structure of your organization, you may be reporting to a functional
manager, a program manager, a portfolio manager, or to some other manager or executive.
Nevertheless, it is your responsibility to work with your team and other relevant individuals
and groups, such as program managers and portfolio managers, to bring all the pieces
together and make the project happen i.e., to achieve the project objectives.
To do this, you need a range of skills and capabilities. They are:

1. Communication
2. Negotiation
3. Problem Solving
4. Influencing
5. Leadership
 There are three types of roles are broadly classified
1) Interpersonal Roles
2) Informational Roles
3) Decision Roles
1. Interpersonal Roles
Under this role, the Manager is taking a major portion of responsibility to manage different
things under Management. The following are the most important roles under this i.e.,
a) The figure head role
b) The Leader's Role
c) The Liaison Role
2. Informational Roles
This is the role that the manager plays a coordination with all the superiors and
Subordinates to manage the things sophisticatedly. Under this the following are the
informational roles
a) The recipient role: Which relates to receiving the information from their superiors
b) The Disseminator Role: Which relates to passing the information to the subordinates
c) The spokes person role: This relates to transmitting the information to those outside of
the organization and simultaneously receives or collects the information from outsiders of
the organization.
3. Decision Role
Under this role, the Manager plays a very important and active part and here the Manager
is taking full responsibility to manage and decide the things even the administrative point
of view also.
Under this the following are the important decision
a) The Entrepreneurial role
b) A disturbance handler role
c) The resource allocator role
d) The negotiator role, which relates to dealing with trade unions, inside parties and outside
parties etc.,
The following are the function of Manager under the Management
1) Planning
2) Organization
3) Staffing
4) Directing
5) Controlling
Planning: Planning is an important function of Manager under the Management.
Whit out proper planning there is not things to be done sophisticatedly

CHAPTER - 2

M anagement Theories:

Bureaucratic Theory by Max Weber

Bureaucratic Theory was developed by a German Sociologist and political economist Max
Weber (1864-1920). According to him, bureaucracy is the most efficient form of organisation.
The organisation has a well-defined line of authority. It has clear rules and regulations which are
strictly followed.

Bureaucratic Theory of Management by Max

Weber
Bureaucratic Theory was developed by a German Sociologist and political economist Max
Weber (1864-1920). According to him, bureaucracy is the most efficient form of organisation.
The organization has a well-defined line of authority. It has clear rules and regulations which are
strictly followed.

According to Max Weber, there are three types of power in an organisation :-

(i) Traditional Power,

(ii) Charismatic Power, and
(iii) Bureaucratic Power Or Legal Power.

Features of Bureaucratic Organisation

The characteristics or features of Bureaucratic Organisation are as follows :-

1) There is a high degree of Division of Labour and Specialisation.

2) There is a well defined Hierarchy of Authority.
3) It follows the principle of Rationality, Objectively and Consistency.
4) There are Formal and Impersonal relations among the member of the organisation.
5) Interpersonal relations are based on positions and not on personalities.
6) There are well defined Rules and Regulations. There rules cover all the duties and rights
of the employees. These rules must be strictly followed.
7) There are well defined Methods for all types of work.
8) Selection and Promotion is based on Technical qualifications.
9) Only Bureaucratic or legal power is given importance.

Criticism of Bureaucratic Organisation

Bureaucratic organisation is a very rigid type of organisation. It does not give importance to
human relations. It is suitable for government organisations. It is also suitable for organisations
where change is very slow. It is appropriate for static organisations.

Bureaucratic organisation is criticised because of the following reasons :-

 (i) Too much emphasis on rules and regulations. The rules and regulations are rigid
and inflexible.
(ii) No importance is given to informal groups. Nowadays, informal groups play an
important role in all business organizations.
(iii) Bureaucracy involves a lot of paper work. This results in lot of wastage of time,
effort and money.
(iv) There will be unnecessary delay in decision-making due to formalities and rules.
(v) Bureaucratic model may be suitable for government organizations. But it is not
suitable for business organizations because business organizations believe in
quick decision making and flexibility in procedures.
(vi) Too much importance is given to the technical qualifications of the employees for
promotion and transfers. Dedication and commitment of the employee is not
considered.
(vii) There is difficulty in coordination and communication.

There is limited scope for Human Resource (HR).

FAYOL’S Process or ADMINISTRATIVE MANAGEMENT

Henry Fayol, a French industrialist is known as the Father of Administrative

Management. Fayol looked at the problems of managing an organization from top
management point of view.

Fayol divided activities of an industrial organization into six groups:

1. Technical: Related to production
2. Commercial: Related to Buying and Selling
3. Financial: Related to search for the capital and its optimum use.
4. Security: Related to the protection of property and person.
5. Accounting: Related to day-to-day accounting activities.
6. Managerial: Related to planning, organizing, command, co-ordination and
control.

General Principles of Management by Fayol:

1. Division of work:
There should be division of work to take advantage of
specialization.
2. Authority and responsibility:
In order to discharge the responsibility properly, there should be
equality between and responsibility.
3.Discipline:
There should be proper discipline amongst the workers.
4.Unity of Command:
A person should have only one boss.
5.Unity of Direction:
 Each group of activities should have only one head and one plan.
6.Subordinates of Individual to General Interest:
Common interest is the above the individual interest.
7.Remuneration of Personnel:
Remuneration should be fair.
8.Centralization:
A proper balance must be maintained between centralization and
decentralization.
9.Scalar Chain:
It suggests that each communication going up or down must flow
through each position in the line of authority.

10.Order:
Man, Machine, materials should be placed in proper order.

11.Equity:
Every worker should be treated equally.
12.Stability of Tenure:
No employee should be removed within short-time. There should
be reasonable security of jobs.
13.Initiative:
Managers should encourage their employees for taking initiative.
14.Espirit de corps:
It means union is strength. Managers should encourage team
spirit among their employees.

TAYLOR SCIENTIFIC M ANAGEMENT

Scientific Management was introduced in America in the beginning of the 20 th century

by Frederick Winslow Taylor. Other contributors to Scientific Management are Frank
& Lillian Gilberth, Henry Gantt, George Berth.

Definition of Scientific Management by Taylor

“Scientific Management is concerned with knowing exactly what you want men to do
and then see in that they do it in the best and cheapest way”.

Principles of Scientific M anagement

(i) Replacement of old rule of thumb method:

Rule of thumb (estimation/assumptions) should be replaced by logical and rational
decisions.

(ii) Scientific selection and training of workers:

 Every organization should follow a scientific system of decisions. The selected
workers are to be trained to avoid wrong methods of work.

(iii) Co-operation between labour and management:

There should be good relation between management and the workers.

(iv)Maximum Output:
The management and the workers should try to achieve maximum output in the
place of restricted output.

(v) Equal division of responsibility:

There must be equal division of responsibility between the manage rs and the
workers.

Techniques of Scientific M anagement

1. Scientific Task Setting (Fair day’s work):

It is essential to set the standard task which average worker should do during a
working day.

2. W ork Study:
1. Method Study: This study is conducted to know the best method of
doing a particular job, by means of reducing the distance travelled by
materials.
2. Motion Study: It is the study of the movement of an operator or a
machine.
3. Time Study: It is the technique of observing and recording the time
required to do each element of an industrial operation.
4. Fatigue Study: It has an adverse effect on the worker’s health and his
efficiency.

3. Planning the Task:

The planning department should prepare detailed instructions for the workers as
to the type, quality and quantity of the products to be produced.

4. Standardization:
Standardization should be maintained in respect of instruments and tools,
periods of work, amount of work, working conditions, cost of production etc.

5. Scientific selection and training of w orkers:

Every organization should follow a scientific system of decisions. The selected
workers are to be trained to avoid wrong methods of work.

6. Differential Piece-wage system:

Under this system, there are two piece work rates, one is lower and another is
higher. If a worker finishes work within standard time or produces more than
standard output within the standard time, he will be given higher piece rate. On
 the other hand, if a worker is below the standard time, he shall be given lower
piece rate.

COM PARISION OF TAYLOR AND HENRY FAYOL

Taylor (Scientific Management) Fayol (Administrative Management)

1.He paid more attention to shop and 1. He gave more emphasis on the functions of
Factory management. managers and the management process as a whole.

2. He worked from bottom to top level. 2.He worked from top level to downwards laying
His centre of study was the operator stress on unity of command, unity of direction,
and the shop level. coordination, spirit de corps, etc.

3. His approach was a kind of efficiency 3. He had a wider perspective. His scheme was to
movement. Thus, it had a narrow perspective. evolve principles which could be applied to
administration in different spheres.

4. He gave stress on increasing productivity 4. He showed regard for the human element by
rather than on narrow perspective. advocating principles such as initiative, stability of
service and spirit of cooperation.

5. He is known as the father of Scientific 5.He is known as the father of Administrative

Management Management Process.

CHAPTER – 3

PLANNING

Planning is deciding future course of action.

Planning deals with the following questions

-What action is to be taken?

-Why the action is to be taken ?
 -How to take action ?
-When to take action ?

NATURE OF PLANNING

(1) PLANNING IS A RATIONAL APPROACH:

Planning is a rational approach for defining where one stands, where one wants to
go in future, and how to reach there.
Rationality means the choice of approach, means for achieving stated objectives

(2) PLANNING IS AN OPEN SYSTEM APPROACH:

Planning adopts an open system approach. It takes inputs from the environment
process and exports outputs to environment.
Therefore while adopting open system approach in planning, managers have to
take into account the dynamic features of the environment.

(3) PERVASIVENESS OF PLANNING:

Planning is pervasive continuous and extends throughout the organization. Every

manager has planning function to perform.

Corporate or Organisation level Plan – Top Level

Divisional Plan – Middle Level
Departmental Plan – Middle Level
Sectional Plan – Low Level Management

(4) PLANNING IS AN INTELLECTUAL ACTIVITY:

Planning involves vision and foresightedness to decide the things to be done in

future. It involves use of mental skills for the achievement of group
objectives.

(5) PLANNING IS RELATED TO OBJECTIVES:

Every plan specifies the objectives to be attained in the future and the steps
necessary to reach them.

Importance of Planning

(1) Primacy of Planning

 Planning precedes all other managerial functions. Managerial functions
such as organizing, staffing, directing and controlling are performed to
achieve the objectives set by the planning process.

(2) To counter uncertainty and change:

There is continuous change in the environment and the organization has

to work in changing environment.
In order to cope with the requirements of such changes, organization
must look ahead for its future course of action which is provided by
planning process.

(3) To focus attention on objectives:

Planning focuses on organizational objectives and direction of action for

achieving these objectives.
The objectives are defined in more meaningful terms so that managerial
actions are possible.

(4) To help in coordination:

Though all managerial functions lead to coordination in the organization,

real beginning is made at the level of planning stage.
Various departments work in accordance with the coordination.

(5) To help in control:

Planning sets the standards against which actual results are to be

compared. At the control stage, an attempt is made to monitor the
performance on continuous basis so that immediate action is taken if
anything goes wrong.

(6) To increase organizational effectiveness:

Planning increases organizational effectiveness by ensuring optimum

use of resources.
Steps in planning

1. Perception of opportunities

Perception of opportunities includes a preliminary look at possible opportunities. It

includes knowledge of where the organization stands in the light of its strengths and
weakness.

2. Establishing objectives

At this stage major organizational and unit objectives are set. Objectives are goals, aims or
purposes that organizations wish over varying periods of time.
 The organizational objectives should be specified in all key result areas.
Key result areas are: profitability, Sales, R&D, Manufacturing and so on.

3. Planning Premises

Planning premises mean the conditions under which planning activities will be undertaken.
Planning premises are external and internal.
External premises include factors in the external environmental like political, social,
technological, competitor’s plans and actions, government policies etc.
Internal premises include organization’s policies, resources of various types and the ability
of the organization to with stand the environmental pressure.
The plans are formulated in the light of both internal and external factors.

4. Identification of alternatives
Based on the organizational objectives and planning premises various alternatives can be
identified.In this step the various actions which can be undertaken to achieve a particular
objective is established.

5. Evaluation of alternatives

Various alternatives which are considered feasible in terms of preliminary criteria may be
taken for detailed evaluation. At this stage an attempt is made to evaluate how each
alternative contributes to the organizational objectives in the light of resources and
constraints.

6. Choice of alternatives
After the evaluation of various alternatives, the most fit one is selected.

7. Formulation of supporting plans

After formulating the basic plan, various plans are derived so as to support the main plan.
8. Establishing sequence of activities
In this it is determined who will do what and when.

Types of planning
There may be several ways in which an organization can undertake planning activities. Some types
of planning are as:

Dimensions Types of Planning

1. Coverage of activities
2. Importance of contents
3. Time period involved
4. Approach adopted
5. Degree of formalization
Corporate and functional planning
Strategic and tactical / operational plans
Long term and short term planning
Proactive and reactive planning
Formal /Sound and informal planning
Corporate and Functional planning
Corporate planning: The term corporate planning denotes planning activities at the top level
which covers the entire organizational activities.
The basic focus of corporate planning is to determine the long term objectives of the organiza tio n
as a whole and then generate plans to achieve these objectives.

Functional planning: Functional planning is undertaken for each functional area of an

organization like Production, marketing, finance, Human resource etc.

Strategic and tactical / operational planning

Strategic Planning: Strategic planning is the process of deciding the objectives of the
organization, deciding the resources to attain these objectives and use of these resources.

Strategic planning sets the long term direction of the organization in which it wants to proceed in
future.

Operational Planning: Operational planning is the process of deciding the most effective use of
the resources already allocated. It is also known as tactical or short term planning.
It is aimed at sustaining the organization in its production and distribution of current products and
services to the existing products.

Long term and Short term planning

Long term planning: Long term planning, is of strategic nature and, involves more than one
year period extending to twenty year or so. The more common long term plan period is 3 – 5
years.
The long term plan usually encompasses all the functional areas of the business.

Short term planning: Short term planning, also known as operational or tactical planning, usually
covers one year. These are aimed at sustaining the organization in its production and distributio n
of current products and services to the existing products.

Proactive and Reactive planning

Proactive planning: Proactive planning involves designing suitable courses of action in
anticipation of likely changes in the relevant environment.
Reactive planning: In reactive planning, organization’s responses come after the environme nta l
changes have taken place.

Formal and Informal planning:

Formal planning: Formal planning is in the form of well structured process involving differe nt
steps. The planning process that is adopted is rational, systematic, well documented and regular.
Generally large corporations undertake planning in formal way.

Informal planning: Informal planning is based on manager’s memory of events, intuitions and
feeling rather than based on systematic process.
Generally small organizations undertake informal planning.

Standing and single use plans

Standing plans:

Standing plans provide guidelines for further course and are used over a period of time. Once
formulated these plans are in operation for a long period unless there is a change in these plans.
For example: Organizational mission and long term objectives.

Single use plans:

Single use plans are relevant for a specified time and after the lapse of that time, these plans are
formulated again for the next period.

For example: projects, budgets, quotas etc.

PLANNING PREMISES
Planning premises means the environment under which planning activities will be
undertaken. Planning Premises are External and Internal.

External Premises includes factors in the External Environment like political. Social.
Technological. Competitor’s plans and actions, government policies.

Internal Premises includes organization’s policies, resources of various types and the
ability of the organization to with stand the environmental pressure. The plans are
formulated in the light of both internal and external factors.
 THE HEIRARCHY OF PLANS

1. M ission: The mission identifies the basic function or task of an enterprise

or agency or of any part of it.
2. Objectives: Objectives or goals are the ends towards which the activity is
aimed – they are the results to be achieved.
3. Strategies: It means grand plans made in light of what it is believed an
adversary might or might not do.
4. Policies: It is a general statements or understandings which guides in
decision making.
5. Procedures: They are plans that establish a required method of handling
future activities.
6. Rules: It is a specific required actions or non actions, allowing no
discretion.
7. Programs: Programs are a complex of goals, policies, procedures, rules,
task assignments, steps to be taken, resources to be employed, and other
elements necessary to carry out a given course of action.
8. Budgets: A budget is a statement of expected results expressed in
numerical terms.

Diagram: The hierarchy of plans

 Budgets: Numerical Programs
Programs: Major or Minor and supporting
Rules
Procedures
Policies: Major or Minor
Strategies
Objectives
Mis