Unit-2

Planning
In short, planning is deciding in advance what to do, now to do it, when to do it, who to do it.
And in the simple words, planning is the primary func on of every manager. The effec ve
performance of other managerial func on depends upon the effec veness of planning.
Planning func on is performed by all managers working at various levels in the organiza on.
Planning is a con nuous process. It is never ending ac vity of managers to keep the
organiza on going. Another important point which must be kept in mind is that planning is
always related to certain objec ves.

Defini on of Planning

The selec on among alterna ves for future courses of ac on of the enterprises as a whole
and each department with it. –Koontz and O’Donnell
Management planning involves the development of forecast, objec ves, policies, programs
and procedures, schedule and budgets. –Louis A. Allen
“Planning is the selec on of related and facts and then thinking use of assump on regarding
the future visualiza on and formula on of proposed ac vi es believed necessary to achieve
desire results”.
Planning is the conscious process of selec ng and developing the best course to accomplish an
objec ve. It is the basis from which future management decision springs. – M.C. Niles
Planning means the determina on of what is to be done, how to be done and where to be
done, who is to do it and how a result comes are to be evaluated. – J.Lundy
Planning is intellectual ac vity. Planning is the process of thinking before doing. It is the
process of the determina on of courses of ac on to achieve the desired results.
Planning is deciding in advance what is to be done. It involves the selec on of objec ves,
policies, procedure, and programmes from among alterna ves. –H.E.Hurley
Planning is a mental process requiring the use of the intellectual facili es, imagina on,
foresight, sound judgement.

Characteris cs/ Features/ Advantages of Planning

The nature of managerial planning will be quite clear by studying following characteris cs /
features / advantages:
⦁ Planning is Achieving the Objec ves
Planning begins with the determining of objec ves. Absence of objec ves no organiza on can
ever be thought about. Managerial planning is related to objec ves. Every plan specifies the
objec ves to be a ained in the future and the steps necessary to achieve them. The
effec veness of the planning is measured by the amount it contributors to the objec ves. A
plan is said to be effec ve if it leads to achievement of the objec ves in a manner. And it is
also called goal-oriented.
⦁ Planning is a Primary Func on of Management
This is the first important func on of management. The other func on – organizing, staffing,
direc ng, controlling comes later. In planning, no other func on of management can be
performed.
Planning is basic to all managerial func ons. It logically precedes the performance of all the
other managerial ac vi es. It helps in efficient organiza on. It assists in manpower planning
and designing of employment and training programmes. Planning of financial and incen ves is
necessary of the mo va on of employees.
⦁ Planning is Con nuous
Planning is the process which begins with the beginning of business itself and ends with the
ending of the business. It means that as long a business exits, the planning process is
con nuous.
Planning is an integral part of the every func on of management, it is a never ending ac vity.
Every manager is engaged in planning con nuously. The old plans have to be revised and new
ones to be introduced depending upon the need of the situa on. Thus, planning is a dynamic
process. It is con nuous changed according to the situa on.
⦁ Planning is Futuris c
Planning g decides the plan of ac on – what is to be done, how is to be done, when is to be
done, by who is to be done, all these ques on are related to future. Planning means looking
ahead/ forward looking. It is carried out to achieve some objec ves in future. It may involve
forecas ng of future events such as customers demand, compe on, government policies etc.
In the other words, the managers a empts to handle in future events effec vely through the
process of planning. Thus, planning in futuris c in nature.
⦁ Planning is Mental Exercise
Planning is known as mental exercise as it is related to thinking before doing something. A
planner has mainly to think about the following ques ons:
1. What to do?
2. How to do it?
3. When to do it?
4. Who to do it?
Planning involves vision and foresightedness to decide the things to be in future. It brings the
gap between where we are and where we want to go. It is not a simple process. It involves
use of mental skills for the achievement of group objec ves. Thus, it is also known as
intellectual process/ mental process.

⦁ Planning Involves Selec on Among Alterna ves

Planning is a choice ac vity. The process of planning involves finding of alterna ves and
selec on of the best alterna ves to achieve and objec ves. Thus, decision making is an
integral part of planning. Every managers find himself surrounded many alterna ves. He has
to pick up the best one.
Importance of Planning
Planning is the first most important func on of the management. It is needed at every level of
the management. Without planning all the business ac vi es of the organiza on will become
meaningless. And certainly difficult to guess the uncertain events in future. The importance of
planning has increased all more in view of the increasing size of the organiza on.
Planning is the founda on of most successful ac on of all enterprises. No enterprise can
achieve its objec ve without systema c planning. Planning helps in determining the
objec ves of each and every segment of the business and the ac vi es necessary to achieve
these objec ves.
Planning is vital importance in the managerial process. It has following as:
 ⦁ Planning Facilitates Decision Making
Decision making means the process of taking decision. A variety of alterna ves are discovered
and best alterna ves are chosen. It is important to determine the objec ves before the
discovery of alterna ves. Objec ves are determined under the process of planning. So, it can
be said that planning facilitates decision making.
Planning helps in decision making. In other words we can say, prepara on of the plans involves
collec on of data, searching the alterna ves selec on the best alterna ves. So, effec ve
planning is must for decision making. Effec ve planning also helps in taking decision about
type of organiza on, supervision, incen ves, and communica on.
⦁ Planning Reduces Risk Uncertainty
Planning is always done for future and future is uncertain. Planning changes in future are
an cipated and various ac vi es are planned in the best possible way. Planning helps in
reducing uncertain es of future as it involves an cipa on of future event. It gives an
opportunity to a manager to foresee various uncertain es which may be caused by changes in
technology, taste and fashion of the people. Sufficient provision can be made in plans to meet
these uncertain es.
⦁ Planning Reduces Overlapping
In planning, future ac vi es are planned in order to achieve the objec ves. The problems are
of when, where, what and almost decided. Other situa on means coordina on is established
among different ac vi es and department.
Planning revolves around organiza onal objec ves. All the ac vi es are directed towards the
common goals. There is an integrated effort throughout the enterprises. It will avoid
duplica on of efforts. Thus, there will be be er coordina on in the enterprises. It is also saying
improvescoordina on.
⦁ Planning is Increases Efficiency
Planning determines as to when and various tasks are to be performed by the different
departments. This enhances the efficiency of various departments. Wastages are reduced
and needless efforts are avoided by advance planning.
⦁ It Promotes Innova on
Planning is basically the deciding func on of management. It helps in innova on and thinking.
Many new ideas come to the mind of a manager when he /she are planning.
⦁ Planning Provides Direc on
The objec ves are defined in simple and clear words. The outcomes of this are that all
employee’s important role in the a ainment of the objec ves of the organiza on. Planning is
directed towards the enterprises objec ves. It is also known as focus on objec ves.
Objec ves are the first step in planning. If the objec ves are clearly laid down, all the
business ac vi es are directed towards these objec ves.
⦁ Planning Establishes Standard for Controlling
By determining the objec ves of organiza on through planning all the people working in the
organiza on and all the departments are informed about when, what and how to do things.
Standard are laid down about their work, me cost. In controlling, at the me of comple ng
the work, has been done is compared with the standard work and devia ons are found out
and if the work has been done as desired the person concerned is held responsible.
In the others words, also known as facilitates control. Managerial control involves keeping
ac vi es on the right path by restric ng devia on from the plans or standards. Through
planning, management establishes standards of performance. These serve as milestones for
the appraisal of actual performance if the actual performance is not as per plans, correc ve
ac on is taken.
Limita on of Planning
Planning is needed both in the business/organiza on and non-business/non-organiza on.
Planning is based on future and nothing can be certainly about future. Planning has several
advantages, but in actual prac ce the above advantage may not be achieved. The process of
planning may suffer from the following limita ons:
⦁ Planning is me consuming process
Planning is facing a definite situa on but long process it cannot face sudden emergencies. It
can be the form of unforeseen problems or some opportuni es of profit is and there has been
no planning managers thinks of comple ng the planning process before taking the decision.
Planning is me consuming process / lengthy process. It consumes a lot of me in defining
objec ves, collec on, analyzing of data, and choice of alterna ves.
⦁ Planning does not work in dynamic environment
Planning is based on the future happening. Future is uncertain and dynamic. A longer period of
planning makes it less effec ves.
⦁ Planning is reduced crea vity
All this ac vi es connected with a ainment of objec ves of the organiza on are
pre-determined. Everybody works as they have been directed to do and it has been made
clear in the plans. They don’t think appropriate ways of discovering new alterna ves.
⦁ Planning does not guarantee of success
Some mes the manager thinks that planning solves all their problems. A manager thinks
makes them neglect their real work and adverse effect of such an a tude has to be faced by
the organiza on. In this way, the planning offers the managers a false sense of security and
makes them careless. Planning does not ensure success rather effects have to be made for it.
⦁ Lack of Availability of Data
There may be lack of reliable informa on on which the plans may be based. Planning loses its
value if reliable informa on is not available or if the management is not ready to spend money
to get sufficient and accurate informa on.
⦁ Rigidity
Planning involves determining a course of ac on in advance. It may lead to internal
inflexibility and procedural rigidity. This may prevent the managers from taking ini a ve and
from doing innova ve thinking.
⦁ Planning involves huge costs
Planning is small work but its process really big. Planning becomes meaningful a er long me
/path. It takes lots of me to cover this path. During this en re period the managers remains
busy to collec ng lots of informa on and analyzing it. In this way the organiza on is bound to
face huge costs.
It is also called expensiveprocess and me consuming process. It is may delay ac on in the
cases, it may be feasible to devote so much me to planning.