Planning and Decision Making

Planning
By Prof. Mayur Malviya

Plan and Planning
Planning is a process that determines the
future course of action.
• Plan is a commitment
• Planning is an activity
A Plan is a part of Planning
Planning is a process of determining a specific
pathway in order to reach from the current
state to the desired state.
Planning
• Concept of Planning – Planning is a process,

which involves the determination of future
course of action. McFarland defined planning
as “Planning may be broadly defined as a
concept of executive action that embodies the
skills of anticipating, influencing and
controlling the nature and direction of
change.”
Planning the concept
• According to Philip Kotler, “Planning is
deciding in the present what to do in the
future. It is the process whereby companies
reconcile their resources with their objectives
and opportunities.”
Planning is deciding in Advance
• ‘WHY TO DO?’
• What to do?
• How to do?
• When to do?
• Who is to do it?
• What is the cost?
Nature and features of Planning
• Process: Planning is a process and not an action taken at a point
of time. It is a process, which decides the future course of action.
• Primary function : Before all functions of management
• Pervasive function: Touches all aspects of business, at all
levels of management.
• Mental activity: An intellectual exercise and involves thinking
and forethought
• Goal-oriented : Cannot do any planning, unless the goals are
known. Plan specifies the goals to be attained in the future and
the steps necessary to reach them
• Forward looking
• Continuous function
Nature of Planning
• Planning is based on facts. Planning is a conscious
determination and projection of a course of action for
the future. It is based on objectives, facts and
considered forecasts. Thus planning is not a guess work.
• Planning is flexible. Planning is a dynamic process
capable of adjustments in accordance with the needs
and requirements of the situations. Thus planning has
to be flexible and cannot be rigid.
• Planning is essentially decision making. Planning is a
choice activity as the planning process involves finding
the alternatives and the selection of the best. Thus
decision making is the cardinal part of planning.
Importance of planning
• Primacy of planning – Planning precedes all other managerial functions. Planning is required to
decide what organization structure is required, what type of people will be required, what should
be leadership style, what motivators to be used etc.
• To offset uncertainty and change – Planning helps to reduce the ill effects of uncertainty. Change
is the only constant thing in the organization. Planning helps organization to adapt with change.
• To focus attention on objectives – Planning assists to focus attention on objectives. It keeps the
course of action on track for achievement of objectives.
• To help in other functions of management - Planning eases the process of co-ordination, control
etc. An effective plan reduces the tension on other functions of management.
• To increase organizational effectiveness – There is a definite difference between doing without
planning and first planning and then doing. Planning increases effectiveness of implementation
and in turn effectiveness of organization.
• Solutions to problems
• Converging Short term and sub-objectives towards prime objective
• Ensure stability
• Survival and progress
Steps in planning
• Perception of opportunities – Having perception of opportunities is not a step in
planning process but one needs to have correct perceptive of opportunities to plan
effectively.
• Establishing objectives – Once the available opportunities are perceived correctly, it
becomes easier to establish objectives of various levels of organization. Establishing
objectives is necessarily first step of planning. Establishing objectives is setting up
goals for different levels.
• Planning premises – After establishing objectives, the next step is to decide planning
premises. One has to assume the environmental conditions, based on some factual
data, for planning. It is utmost necessary to understand the premises on which the
planning will take place.
• Identification of alternatives – An objective can be achieved by various sets of
actions. That is different plans are possible for achievement of same objective. As far as
possible all such alternative plans should be identified. Then and only then the
comparison will be possible.
• Evaluation of alternatives – These alternatives need to be compared with each other.
The plausibility of each of them needs to be verified in the light of available variables.
• Choice of alternative – Based on the earlier step of evaluation of alternatives, the
choice of most viable alternative should be made.
• Backup plans – One or more of close alternatives should be evaluated as backup plans
for the selected alternative. In case the selected alternative fails or the implementation
deviates, the alternative plan or backup plan can be brought in to force.
Planning steps summary
• Classifying or Identification of the problem
• Determining the objectives
• Collecting complete information
• Analysing & sorting the information
• Establishing planning premises: Controllable, Semi- controllable
and Uncontrollable.
• Determining alternative plans
• Operative plans and derivative plans
• Arranging timing/ Schedules and sequencing of activities
• Consensus and participation
• Follow up
Forms of Planning
• Strategic planning:
directed towards organizational goals, 3-5
years, long term direction, comprehensive, long
term effectiveness, entire organisation, affects
due to external environement
• Tactical planning
For utilization of resources, long term
efficiency, short term, specific department,
affects due to internal environment, year to year.
Other forms
• Comprehensive
• Resource
• Functional
Effective planning
• Creating favourable environment
• Initiative from the top level and support
• Effective participation
• Planning committees at different levels
• Effective communication
• Integration of long term and short term plans
• Ideal Organisation structure
• Monitoring of the plans
Types of planning
• Activities
Corporate planning: Top mgmt level, long
term objectives
Functional planning: Derived from Corporate
planning. At functional areas. Prepared on
regular basis
On Content
• Strategic
• Operational
Time dimension
• Short term
• Medium term
• Long term
Basis of Approach
• Proactive
• Reactive
Degree of formalisation:
• Formal
• Informal
Planning Skills
• Planning skill is a skill that show you to look ahead and
accomplish goals or avoid financial, physical, social and
emotional hardship.
Covers even contemporary areas:
• Goal setting
• Organising, analysing and gathering info and date
• Diagnosing problems and causes
• Predicting, forecasting and communicating
• Evaluating and comparing courses of action
• Monitoring action
Components of PS
• Thinking ahead
• Defining goals
• Forecasting trends
• Framing strategies
• Monitoring the implementation
Strategic planning in Indian Industry
• SWOT
One Night 4 college students were playing till late
night and could not study for the test which was scheduled
for the next day. In the morning they thought of a plan.
They made themselves look as dirty with grease and dirt.
They then went up to the Dean and said that they had gone
out to a wedding last night and on their return the tire of
their car burst and they had to push the car all the way
back and that they were in no condition to appear for the
test.
So the Dean said they could have the re-test after 3 days.
They thanked him and said they would be ready by that
time. On the third day they appeared before the Dean, the
Dean said that as this was a Special Condition Test, all four
were required to sit in separate classrooms for the test.
They all agreed as they had prepared well in the last 3
days.
.
• The Test consisted of 2 questions with a total of
100 Marks. See Below for the question Paper
Q.1. Name of the car??

.......... .......... ......... (2 MARKS)
Q.2. which tire burst? (98 MARKS)
a) Front Left b) Front Right
c) Back Left d) Back Right

Planning and Decision Making

Uploaded by

Copyright:

Available Formats

Planning and Decision Making

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Planning and Decision Making

Uploaded by

Copyright:

Available Formats

Planning

By Prof. Mayur Malviya

• Concept of Planning – Planning is a process,

Q.1. Name of the car??

You might also like