REVIEWER OF PA13

FUNCTIONS OF THE MANAGEMENT: PLANNING

PLANNING

This involves setting organizational goals and determining the best course of action to achieve them. It is the
foundation of the management process, providing a roadmap for the organization's future.

 Setting objectives and goals.

 Developing strategies and plans.
 Forecasting future trends and conditions.
 Allocating resources and budgets

PLANNING
Futurity
 is a trap laid down to capture the future.
 is deciding in advance what is to be done in the future.
 is informed anticipation of the future.
 Is “anticipatory” decision-making.
Thinking
 is a thinking process, an organized foresight,
a vision based on fact and experience that is
required for intelligent action.
 is deciding in advance what to do, how to do
it, when to do it, and who is to do it.

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Plan - A plan is a specific, documented intention consisting of an objective and an action statement. The objective
portion is the end, and the action statements represent the means to that end.

Importance of Planning

A. Goal Setting and Direction - Planning helps in setting clear and specific goals, providing a sense of
direction for the entire organization. It aligns efforts toward common objectives and ensures that everyone
understands the purpose and vision of the organization.
B. Resource Optimization- Efficient allocation of resources, including human, financial, and material
resources, is facilitated through planning. By anticipating needs and systematically organizing available
resources, management ensures optimal utilization and avoids wastage.
C. Reducing Uncertainty- Planning involves assessing potential risks and uncertainties, allowing
organizations to anticipate challenges and prepare contingency plans. This proactive approach minimizes
uncertainties and enhances the organization's ability to adapt to changing circumstances.
D. Decision Making- Planning serves as a foundation for informed decision-making. Managers can make
well-considered choices based on a systematic analysis of available options, potential outcomes, and
alignment with organizational goals.
E. Coordination and Alignment- The planning process facilitates coordination among different departments
and levels of the organization. It ensures that activities are synchronized, avoiding conflicts and ensuring
that efforts are complementary, contributing to overall efficiency.
F. Efficiency and Effectiveness- Planning contributes to both efficiency (doing things right) and
effectiveness (doing the right things). It provides a roadmap for executing tasks in a timely and organized
manner, ensuring that resources are utilized to achieve the desired outcomes.
G. Motivation and Commitment- Well-defined plans create a sense of purpose and direction among
employees, fostering motivation and commitment. Clear goals and expectations contribute to a positive
work environment and employee engagement.
H. Continuous Improvement- Planning is an iterative process that involves regular reviews and adjustments.
This commitment to continuous improvement ensures that organizations remain responsive to changing
conditions and can adapt their strategies for sustained success.
 I. Measuring Performance- Planning establishes benchmarks and key performance indicators (KPIs) for
evaluating organizational performance. It provides a basis for measuring progress, identifying areas of
improvement, and celebrating achievements.
J. Customer Satisfaction- Through strategic planning, organizations can align their activities with customer
needs and expectations. This customer-centric approach enhances customer satisfaction, loyalty, and the
organization's competitive position in the market.
K. Risk Management- Planning allows for the identification and mitigation of potential risks. By
anticipating challenges, organizations can develop contingency plans and minimize the impact of adverse
events on their operations.

Features of Planning
a) Planning is GOAL ORIENTED- Planning is centered around the identification and establishment of
specific goals and objectives. It provides a roadmap to guide actions and efforts toward achieving these
desired outcomes.
b) Planning is FUTURISTIC- Planning is future-oriented, involving a forward-looking approach. It
anticipates potential challenges and opportunities, allowing individuals or organizations to prepare
and adapt to changing circumstances.
c) Planning is SYSTEMATIC- Planning is a systematic process that follows a structured approach. It involves
breaking down larger goals into smaller, manageable tasks, making it easier to implement and monitor
progress.
d) Planning is DYANAMIC- Plans should be flexible and adaptable to changes in the external environment or
unforeseen circumstances. The ability to adjust the plan as needed is crucial for its relevance over time.
e) Planning involves DECISION MAKING- Planning involves making decisions about resource allocation,
timelines, and strategies. It requires considering various alternatives and choosing the most suitable course of
action to achieve the desired outcomes.

f) Planning is COMPREHENSIVE- Effective planning considers all relevant factors and aspects related to a
particular goal. It takes into account resources, constraints, risks, and opportunities, ensuring a holistic
approach to problem-solving.

g) Planning RATIONAL- Planning is a rational and logical process that involves analyzing data, weighing
pros and cons, and making informed decisions. It aims to optimize the use of resources and maximize the
likelihood of success.

h) Planning is CONTINOUS- Planning is an ongoing process rather than a one-time event. It involves
continuous monitoring, evaluation, and adjustment of plans to align with evolving circumstances and
changing goals.

i) Planning involves COORDINATION- Planning requires coordination among different individuals, teams,
or departments. It ensures that everyone is on the same page, working towards common goals, and avoids
conflicts or duplication of efforts.

j) Planning involves COMMUNICATION- Clear communication is a key feature of planning. It involves

conveying goals, expectations, and responsibilities to all stakeholders, fostering a shared understanding of
the plan's objectives.

k) Planning is TIME-BOUND- Plans typically include timelines and deadlines to create a sense of urgency
and ensure that actions are taken within specified time frames. Time-bound planning helps in managing
resources efficiently.
 l) Planning is MEASURABLE- Planning involves setting measurable criteria to assess progress and success.
This allows for the monitoring of performance, making it easier to identify areas that may require adjustment
or improvement.

The Planning Process

1. Define Objectives
• Identify the goals and objectives that the plan aims to achieve. Objectives should be specific, measurable,
achievable, relevant, and time-bound (SMART).
2. Situation Analysis
• Conduct a thorough analysis of the external environment and internal factors affecting the organization.
This involves evaluating opportunities, threats, strengths, and weaknesses (SWOT analysis).
3. Formulate Strategies
• Develop strategies that align with the organization's objectives and leverage its strengths to address
weaknesses and capitalize on opportunities while mitigating threats.
4. State Policies
• Establish policies to guide decision-making and actions within the organization. Policies provide a
framework for consistent and cohesive behavior across different levels and functions.

5. Develop the Plan

• Create detailed plans outlining how the organization will achieve its objectives. This can include strategic
plans, operational plans, and tactical plans, each focusing on different aspects of the organization's
functions.
6. Allocate Resources
• Allocate resources such as finances, manpower, technology, and time to support the execution of the plans.
Effective resource allocation ensures that the organization can implement its strategies efficiently.

7. Design Organizational and Structure

• Develop an organizational structure that supports the planned strategies and facilitates effective
communication and coordination. This may involve defining roles, responsibilities, and reporting
relationships.

8. Establish Procedures and Methods

• Define the procedures and methods that will be used to carry out the plans. This includes establishing
standard operating procedures (SOPs) and guidelines to ensure consistency and quality in execution.

9. Put the plans into action by executing the strategies and tasks outlined in the planning phase. This requires
effective communication, coordination, and monitoring of progress. Implement the Plan
•
 10. Monitor and Control
• Implement a monitoring and control system to track progress and ensure that the organization is on course
to achieve its objectives. This involves measuring performance against key performance
indicators (KPIs) and making adjustments as needed.

11. Feedback and Evaluation

• Collect feedback from various stakeholders and evaluate the effectiveness of the plans. Use this
information to identify areas for improvement and to inform future planning efforts.

12. Review and Adjust

• Conduct periodic reviews of the planning process and outcomes. Make adjustments to the plans as needed
based on changing circumstances, new information, or lessons learned from previous experiences.

Approaches to Planning

A. Top-Down Approach
The planning process begins at the highest levels of the organization's hierarchy. The top management sets
the overall strategic direction, goals, and objectives, and these directives are then cascaded down to lower
levels for detailed planning and implementation.
B. Bottom-up Approach
The bottom-up approach involves soliciting input and planning initiatives from lower levels of the
organizational hierarchy, such as front-line employees or middle managers. These ideas and plans are then
aggregated and integrated into an overall organizational plan.

C. Composite Approach
This combines elements of both and bottom-up planning. It seeks to find a balance between strategic
direction from top management and input from lower levels.

D. Team Approach
This involves collaboration among members from different levels and departments within the organization.
Cross-functional teams work together to develop plans, fostering a sense of shared ownership and
collective responsibility.

Types of Planning

A. Strategic Planning

• Long-term goals and overall organizational direction

• Involves setting the organization's vision, mission, and strategic objectives. It often includes environmental
scanning, SWOT analysis, and the development of strategies to achieve long-term goals

B. Tactical Planning
• Intermediate-term plans to support strategic objectives
• Develop detailed plans and actions for specific departments or functional areas
• Bridges the gap between strategic goals and day-to-day operations, providing guidance for a specific time
frame.

C. Operational Planning
• Short-term plans for day-to-day activities
• Involves detailed planning for the implementation of tactical plans. It focuses on specific tasks, resources,
and timelines, ensuring that day-to-day operations align with broader organizational goals
 D. Contingency Planning
• Preparing for unforeseen events and emergencies
• Identifies potential risks and develops alternative plans to address unexpected situations
• Helps organizations respond effectively to crises, ensuring business continuity

E. Scenario Planning
• Exploring multiple future scenarios and their implications
• Involves creating narratives of different possible futures and assessing their impact on the organization
• Helps organizations anticipate and prepare for various potential outcomes

F. Incremental Planning
• Making small, gradual adjustments to existing plans
• Involves making incremental changes to existing strategies and plans based on feedback, experience, and
evolving circumstances
• Allows for flexibility and adaptability over time.

G. Strategic Management by Objectives (MBO)

• Aligning individual and team goals with organizational objectives
• Involves setting specific, measurable, achievable, relevant, and time-bound (SMART) objectives at various
levels of the organization

H. Project Planning
 Planning for specific projects or initiatives
 Involves defining project goals, scope, timelines, and resource requirements
 Ensures that the steps required for successful project completion are identified and executed.

I. Decentralized Planning
 Delegating planning responsibilities to different levels within the organization
 Involves allowing various departments or teams to create their own plans based on their specific needs and
objectives
 Promotes autonomy and responsiveness

J. Adaptive Planning
 Continuous adjustment based on changing circumstances
 Emphasizes flexibility and responsiveness to evolving situations
 Involves regularly reviewing and adjusting plans in response to feedback and changing conditions.

Principles of Planning

i. Principle of Contribution to Objectives- Every plan should help in the achievement of organizational
objectives
ii. Principle of Primary of Planning- Planning precedes all other managerial functions. It is the first and
foremost function to be followed in the process of management.
iii. Principle of Pervasiveness of Planning- Planning is an all-pervasive function. It is important to all
managers regardless of their level in the organization
iv. Principle of Flexibility- This emphasizes the need for plans to be adaptable and responsive to changing
circumstances. It recognizes that unforeseen events or shifts in the external environment may necessitate
adjustments to the original plan, allowing organizations to maintain resilience and navigate uncertainties
effectively.
v. Principle of Planning Premises- This underscores the importance of establishing and relying on realistic
assumptions and forecasts as the foundation for effective planning. It emphasizes that well-founded
expectations about future conditions, such as market trends or resource availability, are crucial to
developing plans that are grounded in a credible understanding of the external environment.