GRADUATE SCHOOL

HUMAN BEHAVIOR IN AN
ORGANIZATION
MPA 214

KATE KATHERINE H. LECCIO PROF. ARIEL LABANIEGO

Presenter/ MPA 1 Course Facilitator

1|Page Nature and Purpose of Planning

 NATURE AND PURPOSE
OF PLANNING

OUTLINE

▪ Introduction ▪ External Limitation of Planning

▪ Meaning and Definition of ▪ Components of Planning
Planning ▪ Process of Planning
▪ Nature and Purpose of Planning ▪ Concept of Educational Planning
▪ Significance of Planning ▪ Importance and Reasons for
▪ Features of Planning Educational Planning
▪ Limitations of Planning

INTRODUCTION
Planning is one of the most important project management and time management
techniques. Planning is preparing a sequence of action steps to achieve some specific goal.
If you do it effectively, you can reduce much the necessary time and effort of achieving the
goal. A plan is like a map. When following a plan, you can always see how much you have
progressed towards your project goal and how far you are from your destination. One
more reason why you need planning is the 80/20 Rule. It is well established that for
unstructured activities 80 percent of the effort give less than 20 percent of the valuable
outcome. It is much easier to adjust your plan to avoid or smoothen a coming crisis, rather
than to deal with the crisis when it comes unexpected.

2|Page Nature and Purpose of Planning

DEFINITIONS
According to Koontz and O'Donnel “Planning is deciding in advance what to do, how
to do it, where to do it and who is to do it. Planning bridges the gap from where we want
to go. It makes possible for things to occur while would not otherwise happen.”
Alford and Beattie defined planning as “the thinking process, the organized foresight,
the vision based on fact and experience that is required for intelligent action.
In the words of Louis A. Allen “Management planning involves the development of
forecasts, objectives, policies, programs, procedures, schedules and budgets.”
Charles WL Hill Steven Mcshane describes planning as “a process whereby
managers select goals choose actions to attain those goals, allocate responsibility for
implementing actions to specific individuals or units, measure the success of actions by
comparing actual results against the goals, and revised plans accordingly.”
Henri Fayol says that planning is “The plan of action is, at one and the same time the
result envisaged, the line of action to be followed the stages to go through and the methods
to use.”
Theo Haimann calls planning as “the functions that determines in advance what is to
be done. When a manager plans, he projects a course of action for the future, attempting
to achieve a consistent, coordinated structure of operations aimed at the desired results.”

NATURE OF PLANNING

There are number of ways available to complete a certain job. Planning chooses any one
of the best alternatives out of the available ones. Economy and certainty are considered
while selecting the best alternative.

Thus, the nature of planning is briefly discussed below:

1. Primary of Planning
The functions of management include planning, organizing, staffing, directing and
controlling. Eminent writers may add other new ones to these functions or those which
have not been included in these functions. Anyway, writers unanimously accept that

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 planning is the primary function of all the other functions. The reason is that the
manager wants to achieve the pre-determined objectives in a better way.
2. Planning Contributes to Objectives
There is a close connection between objectives and planning. Planning is based on the
objectives. If there is no link between planning and objectives, the former will only be
a mental exercise and of no use. Planning contributes to the attainment of objectives.
3. Planning an Intellectual Activity
Planning includes the selection of the best alternative available and thinking before
selection of the best alternative. It involves the ability to foresee mishaps in future
which might affect the smooth functioning of an organisation. So, planning is an
intellectual activity.
4. Planning Results in Higher Efficiency
Planning efficiency is measured in terms of input and output ratios. Planning leads
to maximum output with minimum expenditure. This input and output
relationship is not only determined by money, labour hours and production units
but also by the degree of satisfaction available to the individual as well as the group.
The high degree of human satisfaction motivates the workers to produce more
within the specified time.
5. Planning is a Continuous Process
Planning does not come to an end with the establishment of a business concern.
Planning in other functions is also required. After the establishment of a business
concern, certain decisions are taken. Planning is necessary to implement the
decisions. A number of decisions are taken during the life time of the business
concern. So, planning is necessary throughout the running of the business concern
as a continuous process.
6. Planning is Flexible
While planning, any one of the available alternatives is selected. Planning selects
the best alternative based on certain assumptions. If the assumptions are proved
wrong, the selected alternative tends to be an incorrect one. There is a possibility
of a dead log in the functions of the management. Planning has one more
alternative to suit future situations.
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 7. Unity and Consistency
Every department manager resorts to planning at different times. The planning is
related to the achievement of objectives. In other words, managerial actions of
different managers are unified in order to achieve the objectives. Policies and
procedures of the organization provide a basis for the consistency of executive
behavior and action in matters of planning.
8. Planning is Common to All

Planning work is done by every person who is working in a business unit. He may
be a managing director or a foreman.
Being of a higher place, the planning for a managing director is to frame the
policies and procedures to be adopted. Being at a lower place, planning for a
foreman is to allocate the work to his subordinates. So, planning is common to all.
9. Basis for All Managerial Functions
Planning is found at all levels of management. Top management looks after
strategic planning. Middle management looks after administrative planning and
the lower-level management looks after operational planning.
10. Getting Co-Ordination
Planning co-ordinates various business activities. Without planning, nothing can
be coordinated.
11. Considering Limiting Factors
Every plan is formulated after considering the limiting factors. The limiting factors
may be money, skilled labour, quality materials, plant and machinery.

PURPOSE OF PLANNING

1. To manage by objectives (MBO). The aim of planning is to facilitate the attainment

of objectives. It focuses its attention on the objectives of the organization.
2. To offset uncertainty and change. Planning is required because future is uncertain.
Planning enables the management to look into the future and discover suitable
alternative course of action.

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 Planning helps the management to have a clear-cut idea about the future and to
frame a suitable programme for action. Even when the future is highly certain,
planning is essential to decide the best course of action.
3. To secure economy in operation. Since planning emphasizes efficient operation
and consistency, it minimizes costs and gains economical operation. Coordinated
group effort, even flow of work and deliberate decisions are due to planning.
4. To help in co-ordination. Coordination is an important factor for the smooth
functioning of an organization. As pointed out by H.G. Hicks, “planning
coordinates the activities of the organizations toward defined and agreed upon
objectives. The alternative is random behavior”.

If planning is absent, various divisions of the organization may pursue different

objectives.

5. To make control effective. Control involves those activities which are carried out
to force events to conform to plans. Plans serves as standards of performance.
Control seeks to compare actual performance with set standards. So control cannot
be exercised without plans.
6. To increase organizational effectiveness. The purposes of planning is to provide a
conceptual and concrete basis for initiating and undertaking other managerial
functions like staffing, organizing, directing and control. Planning is a primary
function and it goes a long way to improve efficiency of other functions of
management and makes the management tasks more effective.

ELEMENTS OF PLANNING
Planning as a managerial process consists of the following elements or components:
1. Objectives
Objectives are goals established to guide the activities of the enterprise.
2. Policies
A policy is a basic statement that guides action and decision making. It sets
behavioral limits on managers.

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 3. Procedures and Methods
A procedure is a well thought out course of action. It prescribes the specific way to
do a particular job. Methods are sub units of procedure. They indicate the
techniques to be used to make the procedure effective.
4. Rules
A rule specified necessary course of action in respect of a situation. It prescribes
restriction and a definite and rigid course of action.
5. Strategy
It is a plan of action designed to achieve long term or overall aim.
6. Programs
Programs are precise plans of action followed in proper sequence in accordance
with objectives, policies and procedures.
▪ Budgets
A budget is an estimate of men, money, materials and machine required for success
full implementation of plans.
▪ Projects
A project is a particular job that need to be done in connection with the general
programme.

SIGNIFICANCE OF PLANNING
1. Planning Provides Direction
Planning is concerned with predetermined course of action. It provides the
directions to the efforts of employees. Planning makes clear what employees have
to do, how to do, etc. By stating in advance how work has to be done, planning
provides direction for action. Employees know in advance in which direction they
have to work. This leads to Unity of Direction also. If there were no planning,
employees would be working in different directions and organization would not be
able to achieve its desired goal.
2. Planning Reduces the Risk of Uncertainties
Organizations have to face many uncertainties and unexpected situations every
day.
7|Page Nature and Purpose of Planning
 Planning helps the manager to face the uncertainty because planners try to foresee
the future by making some assumptions regarding future keeping in mind their
past experiences and scanning of business environments. The plans are made to
overcome such uncertainties. The plans also include unexpected risks such as fire
or some other calamities in the organization. The resources are kept aside in the
plan to meet such uncertainties.

3. Planning Reduces Over lapping and Wasteful Activities

The organizational plans are made keeping in mind the requirements of all the
departments. The departmental plans are derived from main organizational plan.
As a result, there will be co-ordination in different departments. On the other hand,
if the managers, nonmanagers and all the employees are following course of action
according to plan then there will be integration in the activities. Plans ensure
clarity of thoughts and action and work can be carried out smoothly.

4. Planning Promotes Innovative Ideas

Planning requires high thinking and it is an intellectual process. So, there is a great
scope of finding better ideas, better methods and procedures to perform a
particular job. Planning process forces managers to think differently and assume
the future conditions. So, it makes the managers innovative and creative.

5. Planning Facilitates Decision Making

Planning helps the managers to take various decisions. As in planning goals are set
in advance and predictions are made for future. These predictions and goals help
the manager to take fast decisions.

6. Planning Establishes Standard for Controlling

Controlling means comparison between planned and actual output and if there is
variation between both then find out the reasons for such deviations and taking
measures to match the actual output with the planned.

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 But in case there is no planned output then controlling manager will have no base
to compare whether the actual output is adequate or not. For example, if the
planned output for a week is 100 units and actual output produced by employee is
80 units then the controlling manager must take measures to bring the 80 unit
production up to 100 units but if the planned output, i.e., 100 units is not given by
the planners then finding out whether 80 unit production is sufficient or not will
be difficult to know. So, the base for comparison in controlling is given by planning
function only.

7. Focuses Attention on Objectives of the Company

Planning function begins with the setting up of the objectives, policies, procedures,
methods and rules, etc. which are made in planning to achieve these objectives
only. When employees follow the plan they are leading towards the achievement of
objectives. Through planning, efforts of all the employees are directed towards the
achievement of organizational goals and objectives.

FEATURES OF PLANNING
Features of planning are the ff. (1) it is primary function of management, (2) it is an
intellectual process, (3) it focuses on determining the objectives, (4) it is a pervasive
function (5) it involves choice and decision making and (6) it is a continuous process.

LIMITATIONS OF PLANNING
While business planning is important and a requisite for every organization, it does have
some limitations. Let us take a look at some limitations of business planning.
1. Planning leads to rigidity
Following predefined plan when circumstances are changed may not bring positive
results for organization. This kind of rigidity in plan may create difficulty.
2. Planning may not work in dynamic environment
For example, there may be change in economic policy, change in fashion and trend
or change in competitor’s policy. A manager cannot foresee these changes
accurately and plan may fail if many such changes take place in.
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 3. It reduces creativity
The managers do not take any initiative to make changes in the plan according to
the changes prevailing in the business environment. They stop giving suggestions
and new ideas to bring improvement in working because the guidelines for working
are given in planning only
4. Planning involves huge Cost
Planning process involves lot of cost because it is an intellectual process and
companies need to hire the professional experts to carry on this process. Along
with the salary of these experts the company has to spend lot of time and money to
collect accurate facts and figures. So, it is a cost-consuming process. If the benefits
of planning are not more than it cost then it should not be carried on.
5. It is a time-consuming process
Planning process is a time-consuming process because it takes long time to
evaluate the alternatives and select the best one. Lot of time is needed in
developing planning premises. So, because of this, the action gets delayed. And
whenever there is a need for prompt and immediate decision then we have to avoid
planning.
6. Planning does not guarantee success
It is not true that if a plan has worked successfully in past, it will bring success in
future also as there are so many unknown factors which may lead to failure of plan
in future. Planning only provides a base for analyzing future. It is not a solution for
future course of action.
7. Lack of accuracy
For example, if in the plan it is assumed that there will be 5% inflation rate and in
future condition the inflation rate becomes 10% then the whole plan will fail and
many adjustments will be required to be made.

EXTERNAL LIMITATIONS OF PLANNING

External limitations of planning are natural calamity, changes in competitors’ policies,
taste, fashion and trend in the market, technologies and in government and economic
policy.
10 | P a g e Nature and Purpose of Planning
COMPONENTS OF PLANNING
In the process of planning, several plans are prepared which are known as components of
planning. Plans can be broadly classified as: Strategic plan, Tactical Plan, Operational
Plan and Contingency Plan.

STRATEGIC PLAN. A strategic plan is an outline of steps designed with the goals of the
entire organization as a whole in mind, rather than with the goals of specific divisions or
departments. It is further classified as (i) Missions (ii) Objective or goals and (iii)
Strategies.

Mission. The mission is a statement that reflects the basic purpose and focus of the
organization which normally remain unchanged. The mission of the company is the
answer of the question: why does the organization exists? For example, is the mission of
Ford: “we are a global, diverse family with a proud inheritance, providing exceptional
products and services”.

Both goals and objective can be defined as statements that reflect the end towards
which the organization is aiming to achieve. However, there are significant differences
between the two. A goal is an abstract and general umbrella statement, under which
specific objectives can be clustered.

Why should I use SMART goals?

With SMART goals, you’re more likely to achieve your goal efficiently and effectively.

For example:
GOAL: I will obtain a job as a high school math teacher within three months after
graduating with my Bachelor of Science in Education.

Specific: The goal of becoming a high school math teacher is well-defined.

Measurable: Success can be measured by the number of applications, interviews and job
offers.
11 | P a g e Nature and Purpose of Planning
Achievable: The goal setter will have the appropriate degree for the job.
Relevant: The goal setter is planning to get a job in the education industry after getting
an education degree.
Time-based: The goal setter has set a deadline to achieve their objective within the three
months following graduation.

Objectives. Objectives are statements that describe—in precise, measurable, and

obtainable terms which reflect the desired organization’s outcomes. For example, to
achieve the goal of increasing revenues, a company can have an objective like “Add three
new products by the end of October this year.”

Strategies. In strategic planning is an organizational management activity that is used

to set priorities, focus energy and resources, strengthen operations, ensure that
employees and other stakeholders are working toward common goals, establish
agreement around intended outcomes/results, and assess and adjust the organization’s
direction in response to a changing environment.

WHEN SHOULD STRATEGIC PLANNIGN BE DONE?

The scheduling for the strategic planning process depends on the nature and needs of the
organization and the its immediate external environment. For example, planning should
be carried out frequently in an organization whose products and services are in an
industry that is changing rapidly. In this situation, planning might be carried out once or
even twice a year and done in a very comprehensive and detailed fashion (that is, with
attention to mission, vision, values, environmental scan, issues, goals, strategies,
objectives, responsibilities, time lines, budgets, etc.). On the other hand, if the
organization has been around for many years and is in a fairly stable marketplace, then
planning might be carried out once a year and only certain parts of the planning process,
for example, action planning (objectives, responsibilities, time lines, budgets, etc.) are
updated each year.

12 | P a g e Nature and Purpose of Planning

You must also consider the following guidelines: (1) Strategic planning should be done
when an organization is just getting started (2) Strategic planning should also be done in
preparation for a new major venture. (3) Strategic planning should also be conducted at
least once a year in order to be ready for the coming fiscal year. (4) Each year, action plans
should be updated. (5) During implementation of the plan, the progress of the
implementation should be reviewed at least on a quarterly basis by the board.

WHAT IS STRATEGIC PLANNING PROCESS?

1. Identify Your Strategic Position
2. Gather People and Information.
3. Perform a SWOT Analysis
4. Formulate a Strategic Plan.
5. Execute Your Strategic Plan
6. Constantly Monitor Performance

A SWOT diagram allows you to think about your own internal strengths and
weaknesses. It also helps you think about external opportunities and threats that could
affect your company’s performance. The SWOT also helps you explore what the
differentiators between yourself and your competitors are.

TACTICAL PLAN. A tactical plan outlines the necessary steps required to fulfill
strategic business plans. These are short-term steps and actions designed to help
companies achieve long-term goals. Tactical plans may change according to events that
occur in the workplace and a company’s specific needs

To create a tactical plan, you need to pay attention to the vision, create objectives and
goals, assign actions to objectives, determine KPIs (Key performance indicators), use
tools and resources, delegate work to specific people and allow for flexibility.

13 | P a g e Nature and Purpose of Planning

Here are some examples of tactical plans businesses use to accomplish strategic plans:
Example 1:
STRATEGIC PLAN: The marketing team at Visual Studio has created a strategic plan to
gain 10,000 new followers on every social media platform by the end of the year.

TACTICAL PLAN:
▪ Michael will create a ‘social media growth’ campaign and spend $100 on ads every
week that encourage people to ‘like’ and ‘follow’ our company on social media.
▪ Suzette will publish five new social media posts per week to increase overall
engagement and growth. Bernie will do one live video a week that highlights our
new products.
▪ Emily will monitor platform analytics to ensure that social media activity continues
to increase.
▪ Jen will write two original blog posts a week to share on social media.

Example 2:
STRATEGIC PLAN: The management team at Black Rock Auto has created a strategic
plan that requires its sales representatives to increase sales throughout the month of May
by 15%.

TACTICAL PLAN:
▪ James, Richard, Melissa and Beatrice will start arriving to work before peak sales
hours.
▪ Jonathan will conduct employee reviews daily to reinforce effective sales methods.
▪ Marie will monitor goal progress and report outcomes weekly to sales
representatives.
▪ David will teach new sales techniques to the team during slow times.

Tactical planning is important because it provides detailed information that helps

everyone on a team understand what is expected and required to achieve a goal.

14 | P a g e Nature and Purpose of Planning

OPERATIONAL PLAN. The specific results expected from departments, work groups,
and individuals are the operational goals. These goals are precise and measurable.
“Process 150 sales applications each week” or “Publish 20 books this quarter” are
examples of operational goals. An operational plan is one that a manager uses to
accomplish his or her job responsibilities. Supervisors, team leaders, and facilitators
develop operational plans to support tactical plans.

The following are examples of ongoing plans: (1) A policy provides a broad guideline for
managers to follow when dealing with important areas of decision making. Policies are
general statements that explain how a manager should attempt to handle routine
management responsibilities. Typical human resources policies, for example, address
such matters as employee hiring, terminations, performance appraisals, pay increases,
and discipline.

Operational plans can be single-use plan or standing plan. A single-use plans apply to
activities that do not recur or repeat. A one-time occurrence, such as a special sales
program. It is a single-use plan because it deals with the who, what, where, how, and how
much of an activity. While standing plans are usually made once and retain their value
over a period of years while undergoing periodic revisions and updates. (2) A procedure
is a set of step-by-step directions that explains how activities or tasks are to be carried
out. For example, most organizations have procedures for purchasing supplies and
equipment. This procedure usually begins with a supervisor completing a purchasing
requisition. The requisition is then sent to the next level of management for approval. The
approved requisition is forwarded to the purchasing department. Depending on the
amount of the request, the purchasing department may place an order, or they may need
to secure quotations and/ or bids for several vendors before placing the order. By defining
the steps to be taken and the order in which they are to be done, procedures provide a
standardized way of responding to a repetitive problem. (3) A rule is an explicit statement
that tells an employee what he or she can and cannot do. Rules are “do” and “don't”
statements put into place to promote the safety of employees and the uniform treatment

15 | P a g e Nature and Purpose of Planning

and behavior of employees. For example, rules about tardiness and absenteeism permit
supervisors to make discipline decisions rapidly and with a high degree of fairness.

CONTINGENCY PLAN. Intelligent and successful management depends upon a

constant pursuit of adaptation, flexibility, and mastery of changing conditions. Strong
management requires a “keeping all options open” approach at all times — that's where
co Contingency planning involves identifying alternative courses of action that can be
implemented if and when the original plan proves inadequate because of changing
circumstances.

PROCESS OF PLANNING
As planning is an activity, there are certain reasonable measures for every manager to
follow:
1) Setting Objectives
2) Developing Planning Premises
3) Identifying Alternative Courses of Action
4) Evaluating Alternative Course of Action
5) Selecting One Best Alternative
6) Implementing the Plan
7) Follow Up Action

Setting Objectives
This is the primary step in the process of planning which specifies the objective of an
organization, i.e. what an organization wants to achieve.
▪ The planning process begins with the setting of objectives.
▪ Objectives are end results which the management wants to achieve by its
operations.
▪ Objectives are specific and are measurable in terms of units.
▪ Objectives are set for the organization as a whole for all departments, and then
departments set their own objectives within the framework of organizational
objectives.
16 | P a g e Nature and Purpose of Planning
Example:
A mobile phone company sets the objective to sell 2,00,000 units next year, which is
double the current sales.

Developing Planning Premises

▪ Planning is essentially focused on the future, and there are certain events which
are expected to affect the policy formation.
▪ Such events are external in nature and affect the planning adversely if ignored.
▪ Their understanding and fair assessment are necessary for effective planning.
▪ Such events are the assumptions on the basis of which plans are drawn and are
known as planning premises.
Example:
The mobile phone company has set the objective of 2,00,000 units sale on the basis of
forecast done on the premises of favorable Government policy towards digitization of
transactions.

Identifying Alternative Course of Actions

▪ Once objectives are set, assumptions are made.
▪ Then the next step is to act upon them.
▪ There may be many ways to act and achieve objectives.
▪ All the alternative courses of action should be identified.
Example:
The Mobile company has many alternatives like reducing price, increasing advertising
and promotion, after sale service etc.,

Evaluating Alternative Course of Action

▪ In this step, the positive and negative aspects of each alternative need to be
evaluated in the light of objectives to be achieved.
▪ Every alternative is evaluated in terms of lower cost, lower risks, and higher
returns, within the planning premises and within the availability of capital.

17 | P a g e Nature and Purpose of Planning

Example:
The mobile phone company will evaluate all the alternatives and check its pros and cons.

Selecting One Best Alternatives

• The best plan, which is the most profitable plan and with minimum negative
effects, is adopted and implemented.
• In such cases, the manager’s experience and judgement play an important role in
selecting the best alternative.
Example:
Mobile phone company selects more T.V advertisements and online marketing with
great after sales service.

Follow up the Actions

• Monitoring the plan constantly and taking feedback at regular intervals is called
follow-up.
• Monitoring of plans is very important to ensure that the plans are being
implemented according to the schedule.
• Regular checks and comparisons of the results with set standards are done to
ensure that objectives are achieved.
Example:
A proper feedback mechanism was developed by the mobile phone company throughout
its branches so that the actual customer response, revenue collection, employee
response, etc. could be known.

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