Learn and Understand, Description of the Key Characteristics of the Planning!
Planning involves setting objectives and deciding in advance the appropriate course of action to achieve these objectives so we can also, define planning as setting up of objectives and targets and formulating an action plan to achieve them. After that also, discuss the main steps involved in the planning process in an organization. Also learn, What is the Importance of Planning in Management? Description of the Key Characteristics of the Planning!
Another important ingredient of planning is time. Plans are always developed for a fixed time period as no business can go on planning endlessly. Also, keeping in mind the time dimension we can define planning as “Setting objectives for a given time period, formulating various courses of action to achieve them and then selecting the best possible alternative from the different courses of actions”.
The main key Characteristics of Planning!
It is goal-oriented.
- Planning is made to achieve the desired objective of business.
- The goals established should general acceptance otherwise individual efforts & energies will go misguided and misdirected.
- Planning identifies the action that would lead to desired goals quickly & economically.
- It provides a sense of direction to various activities. E.g. Maruti Udhyog is trying to capture once again Indian Car Market by launching diesel models.
It is looking ahead.
- Planning is done for future.
- It requires peeping in future, analyzing it and predicting it.
- Thus planning is based on forecasting.
- A plan is a synthesis of the forecast.
- It is a mental predisposition for things to happen in future.
It is an intellectual process.
- Planning is a mental exercise involving creative thinking, sound judgment, and imagination.
- It is not a mere guesswork but a rotational thinking.
- A manager can prepare sound plans only if he has sound judgment, foresight, and imagination.
- Planning is always based on goals, facts and considered estimates.
It involves choice & decision making.
- Planning essentially involves the choice among various alternatives.
- Therefore, if there is only one possible course of action. As well as, there is no need planning because there is no choice.
- Thus, decision making is an integral part of planning.
- A manager is surrounding by no. of alternatives. Also, he has to pick the best depending on requirements & resources of the enterprises.
It is the primary function of management / Primacy of Planning.
- Planning lays the foundation for other functions of management.
- It serves as a guide for organizing, staffing, directing and controlling.
- All the functions of management are performing within the framework of plans laid out.
- Therefore planning is the basic or fundamental function of management.
It is a Continuous Process.
- Planning is a never ending function due to the dynamic business environment.
- Plans are also preparing for specific period f time and at the end of that period, plans are subjecting to revaluation and review in the light of new requirements and changing conditions.
- Planning never comes into end till the enterprise exists issues, problems may keep cropping up and they have to tackle by planning effectively.
Planning is all Pervasive.
- It is requiring at all levels of management and in all departments of the enterprise.
- Of course, the scope of planning may differ from one level to another.
- The top level may be more concerned about planning the organization as a whole whereas the middle level may be more specific in departmental plans and the lower level plans implementation of the same.
It is designing for efficiency.
- Planning leads to accomplishment of objectives at the minimum possible cost.
- It avoids wastage of resources and ensures adequate and optimum utilization of resources.
- A plan is worthless or useless if it does not value the cost incurred on it.
- Therefore planning must lead to the saving of time, effort, and money.
- Planning leads to proper utilization of men, money, materials, methods, and machines.
It is Flexible.
- Planning is done for the future.
- Since future is unpredictable, planning must provide enough room to cope with the changes in customer’s demand, competition, govt. policies etc.
- Under changed circumstances, the original plan of action must revise and updated to make it more practical.
The Main Steps Involving the Planning Process!
The few main steps involved in the planning process in an organization.
The external environment covers uncontrollable and unpredictable factors such as technology, market (prices, Competition, customers, etc.), socio-economic climate, political conditions and ecological conditions within which our plans will have to operate. Also read, What is the Process of Manpower Planning?
Also, the internal environment covers relatively controllable factors, such as personnel resources, technology, knowledge, finance, facilities, etc., at the disposal of the firm. The study of the environment or situation analysis will reveal the threats to be met and the opportunities to exploit as well as strengths and weaknesses.
Determination of Mission and Objectives:
The situation analysis will serve as a background for the formulation of our mission and objectives.
A mission provides the central or basic purpose answering a few basic questions:
(1) What is our business?
(2) Who are our customers?
(3) What is our economic and social responsibility? and so on.
The mission or creed statement will ensure purposeful life for our enterprise in the Justness world. It will give firm direction and make our activities meaningful and interesting.
On the basis of situation analysis and our balance sheet of assets and liabilities, we can easily take the first step in actual business planning, viz., the setting of the hierarchy of objectives — overall comparable objectives as well as divisional and departmental objectives. Objectives and goals are formulating at each level of management.
Objectives give us the precise idea regarding our destination, i.e., where we want to go. The real problem is how to find the best way to achieve the stated objectives.
Finding the best way to go there (where we want to be) is called strategy development, Objectives answer the question:
What business is going to be? Strategy answers the question: How best can the business achieve under intelligent competition? The strategy is the magic wand of action to accomplish our objectives; For each functional area of our business, we will formulate our strategic i.e., desirable means to achieve stated ends or objectives.
Developing Programmes or Action Plans:
On the basis of our objectives and strategies, we will now formulate our detailed programmes or time-bound action plans to achieve specific goals or targets.
An action plan has three elements:
(1) The time limit of performance,
(2) The allocation of tasks to personnel in each department,
(3) The timetable or schedule of work to accomplish targets within the stated period.
Control is the final phase of our planning, process. It is the other half of planning. Control is the extension of the planning process and the two take place together. Also, Control answers the question: How will we know where we are in future? By means of feedback loop, it ensures accomplishment of objectives.
Results or performance will compare with standards. If deviations are noted, corrective actions are taking in time. Thus planning-action-control-re-planning cycle assures the achievement of our goals or objectives.