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Organization and
Management
Quarter 1 – Module 5:
Nature, Types and Levels of
Planning
 Lesson
Nature, Types and Levels of
5 Planning

Business plays an important role in the society. It is a very powerful driver

and significant mechanism of the economy as it creates value to the community.
However, being into it can be most challenging as well. The process of building an
organization and continuously providing the society with much needed and wanted
goods and services can be strenuous and troublesome. Keeping it that way is
another herculean undertaking. Management must lead the way to meeting these
challenges. Effective management is the key to a successful business endeavor.
For an organization to have effective management, an intensive and thorough
planning is a requirement.

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ACTIVITY 1: “Noelle’s Cakes and Pastries”

Instruction: Read the business case and answer the questions below. Write your
answer on the space provided:

Noelle’s Cakes and Pasties has a long term goal of achieving growth and
profitability. Jake is a top-level manager for Noelle’s Cakes and Pastries while Sophia
is a middle-level manager. Alex, the front-line manager, is responsible for the
operations of the business.
A. What will Jake, Sophia and Alex do? How do you think they are able to
achieve the company’s goal?

B. Why do you think there is a need to do that?

What is It

You are doing great so far! However, we need to answer a few more questions
in the case of Noelle’s Cakes and Pastries. It is true that in order for Jake, Sophia
and Alex to achieve the company’s goal, they have to conduct a thorough planning.
But what types of plans will they have to make? What makes the plan of Jake
different from that of Sophia and Alex? You will be able to find the answers to those
questions later as you continue to read. Let’s start this interesting discussion about
planning.

NATURE OF PLANNING

Planning is a vital component in the operations of a business. Planning

promotes several positive business results. As Benjamin Franklin said, "If you fail to
plan, you plan to fail”. It is imperative for us to know and understand the following
importance of planning in the organization:

1. Planning provides direction to all of the organization’s human resources –

both managers as well as employees.

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 2. Planning reduces uncertainty; anticipates changes and their impact
3. Planning minimizes wastes, negative practices, ineffectiveness and
inefficiencies
4. Plans may be used for controlling.

It is now time to define planning. Planning is a process that involves the

setting of the organization’s goals, establishing strategies for accomplishing those
goals, and developing plans of action or means that managers intend to use to
achieve organizational goals. Planning starts with setting a company’s mission and
vision together with its goals. Mission is the basic purpose of an organization and
range of their operations while Vision is a mental image of what the organization will
be in the future as desired by the company management and employees. Goal
setting is the identification of targets or desired ends that management wants to
reach.

Steps in Planning

Planning is a process and, as such, involves steps—from carrying out its

purpose, setting of goals/objectives, and determining what should be done to
accomplish them. Here are the five steps in the planning process:

Keynote:

Define your goals/objectives by Know your target. Identify the things that
identifying desired outcomes/results in your company/business wants to
very specific ways. achieve.

Keynote:
Determine where you stand in relation Know the current/present position of the
to set goals/objectives; know your company terms of its goals. Know its
strengths and weaknesses. strengths and weaknesses.

Keynote:

Develop premises regarding future Try to perceive future circumstances that

conditions; anticipate future events, may affect the company positively or
generate alternative “scenarios” for what negatively as these may help or prevent
may happen; identify for each scenario the company from meeting its goals.

Keynote:

Analyze and choose among action Given the company’s current situation,
alternatives; list and carefully evaluate strengths and weaknesses, be able to list
possible actions and choose the down possible ways to be able to achieve
alternative most likely to accomplish its goals and don’t forget to evaluate
goals/objectives.
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 each. Lastly, choose the best alternative.

Keynote:
Put the best alternative into action.
Implement the plan and evaluate
Execute the plan. Evaluate the outcome
results; take corrective action and revise
and figure out its positive and negative
plans as needed.
results. Make necessary adjustments.

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TYPES OF PLANS

Plans within organizations can be generally described in terms of

comprehensiveness, length of time covered or time frame, specificity, and frequency
of use.

Different types of plans include the following:

1. Strategic Plans – plans that establish the organization’s overall goals and
apply to the entire firm; they are broad in scope and are the responsibility
of the CEO, President, and General Manager of the company
2. Tactical Plan - middle level management plan which refers to procedures
and transformation of strategic goals/plans with specific goals
3. Operational Plan – plans that apply to a particular unit area only; the scope
is narrow; achievement of company goals may not be achieved if
operational plans are not clear
4. Long term plans – plans that go beyond three years; everyone must
understand the organization’s long term plans to avoid confusion that may
divert the organization’s members attention
5. Short term plans – plans that cover one year or less; such plans must lead
toward the attainment of long term goals and are the responsibility of the
unit/department heads
6. Single use plans – plans used or stated once only as these applies to the
entire organization
7. Standing plans – plans that are ongoing; provide guidance for different
activities done repeatedly
8. Directional plans – plans that are flexible or give general guidelines;
although flexible and general, these plans must be related to the strategic
plans
9. Specific plans – plans that are clearly stated and which have no room for
interpretation; language must be very understandable

PLANNING AT DIFFERENT LEVELS IN THE FIRM

Planning at the different levels of management include strategic planning,

tactical planning and operational planning.

Top Level Management Planning (Strategic Planning)

As earlier mentioned, top level managers are the ones conducting the strategic
planning for the organization. This includes coming up with decisions regarding the
organization’s long term goals and strategies. The top level managers are the CEO,
company presidents or the company’s senior executives.

Strategic planning centers on long term and broad view plan of the company.

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Middle Level Management Planning (Tactical Planning)

Middle level managers are the ones responsible for making the tactical plan.
Tactical plans are usually actualized in the departmental areas like marketing,
production, finance, personnel and the like.

Tactical planning happens in real time seeking short term outcomes.

Frontline/Lower Level Management Planning (Operational Planning)

Front line or Lower level managers are the managers who are closest to the
core or those who are directly involved in the day to day operations of the business.
They are responsible for making the operational plan, as in many cases they are the
ones involved in the customer facing activities of the organization.

Operational planning is narrow in scope and focuses on routine activities of

the company. It is short term and may change year after year.

It is also important to emphasize that these three plans from the different
levels of management should not be independent from each other. They must be
aligned and supportive of each other and all anchored on the organization’s mission
vision and goals.
An example on how strategic, tactical and operational plans are being done
and how they may be aligned in support of each other is being given to you below:

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 You may have observed that tactical and operational plans are constructed in
support of the long term strategic plan of the organization. As the plan progresses, it
becomes narrower and specific to the particular department or unit concerned.
In line with the above lesson, you will be answering an activity that will test
your analysis of plans as to whether they are strategic, operational or tactical.
Let’s see how well you can identify and analyze the statements below. Are you
ready now? Let’s do this!

ACTIVITY 2: “PYRAMID PLOT”

Instructions: Read and analyze the statements below and identify whether it is
strategic, tactical or operational. Copy the exact statement on the space provided for
it on the pyramid.

Here are the statements:

1. The company hires the finest designers and brings them to other
countries for training.
2. The company works their way to improve the quality of their bags
and lessen customer complaints
3. The company works to become the leading manufacturer of bags in
the country in five years.

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 What I Have Learned

This time, I want to know how much you have learned and understood from
the lesson. The paragraph below will help you summarize what you have learned in
this module.
ACTIVITY 3: “IN A NUTSHELL”
Instructions: Read and complete the paragraph with appropriate terms by filling in
the blanks.

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 Assessment

You’re doing great! We are now towards the last part of this module. Just like
every end of a lesson, the teacher wants to check how much you have learned and
understood from the discussion.
Now it’s time to test your memory and understanding of the lesson.

I. Read carefully and match descriptions in column A to

appropriate terminologies in column B. Write the letters
only.

COLUMN A COLUMN B
1. plan that covers one year or less A. Standing plans
2. plan that applies to one particular
area or unit only; short term B. Strategic Plan
3. ongoing plans and provide guidance
to organization’s activities C. Mission
4. includes the CEO, company presidents
and senior executives D. Short term plan
5. reduces uncertainty; anticipates changes
and their impact E. Goal Setting
6. a broad view plan of the company
7. a process that involves the setting of the F. Planning
organization’s goals, establishing strategies
for accomplishing those goals, and developing G. Operational Plan
plans of action
8. identification of targets or desired ends H. Top Level Mgt
that management wants to reach
9. a mental image of what the organization I. Vision
will be in the future
10. basic purpose of an organization and J. Importance of
range of their operations Planning

II. Number the following steps (1-5) in planning according to

how you understood the discussion.
11. Execute the idea/plan and assess the outcome.

12. Identify your targets or desired end result.

13. Foresee impending eventualities.

14. Know your assets and edge as well as your flaws and vulnerability.

15. Study possible actions and make a choice among the options.

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References

Cabrera, HM., Altarejos, A., Benjamin, R. (2016).Organization and

Management. Vibal Group, Inc.

Cabrera, HM., et. al. (2016). Organization and Management (Teacher’s

Manual). Vibal Group Inc.