Planning

Ms.N.Jasintha
Meaning……….

Planning is the first and foremost function of

management. Planning is an attempt to anticipate
the future in order to achieve better performance.
Koontz and O’Donnel

“Planning is deciding in advance what to do, how to do

it, when to do it and who is to do it. It bridges the gap
from where we are and to where we want to go. It is
in essence the exercise of foresight”
M.S. Hardly

“Planning is deciding in advance what is to be done. It

involves the selection of objectives, policies,
procedures and programs from among alternatives”.
Heying and Massie;

“Planning is that function of the manager in which he

decides in advance what he will do. It is a decision
making process of a special kind. It is an intellectual
process in which creative mind and imagination are
essential”.
 The organizational planning process

Step: 1 Develop the plan

 Mission
 Strategic goals
Step: 2 Translate the Plan
 Tactical objectives and plans
 Strategy map to align goals
 Contingency and scenario plans
 Intelligence teams
Step: 3 Plan Operations
 Operational goals and plans
 The measures and targets
 Crisis plans
Step 4 Execute the Plan
 Management by objectives
 Performance dashboards
 single-use plans
 decentralized responsibility
Step 5 Monitor and Learn
 NATURE OF PLANNING

• Planning is goal-oriented
• Planning is a primary function
• Planning is all-pervasive
• Planning is a continuous process
• Planning is forward-looking
• Planning involves choice
• Planning is directed toward efficiency
 Importance of planning

1) Primacy of planning
2) To minimize risk and uncertainty
3) To focus attention on objectives
4) To facilitate control
5) To increase organizational effectiveness
 CHARACTERISTICS OF GOOD PLAN

• Must be realistic
• Must be implementable
• Must be cost effective
• Must be simple to understand
• Must be a clear description of the future direction
 BENEFITS OF PLANNING

• Provide a sense of direction

• Prerequisite to successful growth
• Set up the organizational framework
• Helps delegation
• Helps motivate people
• Serves as a communication media
• Lays the basis for control
• Provides coordination
• Facilitates efficient use of resources.
• Reduces uncertainty by anticipating change
 Types of planning

Planning can be classified on the basis of

 Coverage of activities
 Importance of contents in planning
 Approach adopted in planning process
 Time dimension and
 Degree of formalization in planning process
 Types of Plan
• Strategic plan
• Strategic plans are designed with the entire organization in mind and begin with an
organization's mission.
• Top-level managers, such as CEOs or presidents, will design and execute strategic plans to
paint a picture of the desired future and long-term goals of the organization.
• Essentially, strategic plans look ahead to where the organization wants to be in three, five,
even ten years or more.
• Tactical plans
• Tactical plans support strategic plans by translating them into specific plans relevant to a
distinct area of the organization.
• Tactical plans are concerned with the responsibility and functionality of lower-level
departments to fulfil their parts of the strategic plan. (Between one to two years scope)
• Operational plans
• They are the plans that are made by frontline, or low-level, managers. All operational plans
are focused on the specific procedures and processes that occur within the lowest levels of the
organization.
• Managers must plan the routine task of the department. (Within one year scope)
Planning Types & Managerial Levels

Top Strategic Planning

Middle Tactical Planning

Lower Operational Planning

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 Types of Plans

Operations Plans

Single use plan Standing plan

(for non-repetitive (for repetitive activities)
activities) Mission
Programs Objectives
Projects Strategies
Budgets Policies
Procedures
Hierarchies of plans
 Mission

The mission describes the organization’s values, aspirations and

reason for being.
The mission statement is a broadly stated definition of purpose
that distinguishes the organization from others of a similar type
 State Farm Insurance

State Farm’s mission is to help people manage the risks of

everyday life, recover from the unexpected and realize
their dreams.
We are people who make it our business to be like a good
neighbor; who built a premier company by selling and
keeping promises through our marketing partnership;
who bring diverse talents and experiences to our work
of serving the state Farm customer.
Our success is built on a foundation of shared values –
quality service and relationships, mutual trust,
integrity, and values
 Eco friendly clothing and accessories
Holstee

There is nothing more important than pursuing your passion

Some mission statements also describe company characteristics
such as desired markets and customers, product quality,
location of facilities and attitude toward employees.
 Objectives

Objectives are the goals, aims or purposes that the

organizations wish to achieve over varying periods of time
 Strategy

According to CIMA (UK)

strategy is a course of action, including the specification of
resources required, to achieve a specific objective.
 Policies

According to George R Terry

“ Policy is a verbal, written or implied overall guide, setting up
boundaries that supply the general limits and directions in which
managerial action will take place”.
 Procedures

Policies are carried out by means of more detailed guidelines called

procedures. A procedure provides a detailed set of instructions for
performing a sequence of actions involved in doing a certain piece
of work
 Rules

Rules are detailed and recorded instructions that a specific action

must or must not be performed in a given situation
 Program

A program is a sequence of activities directed towards the

achievement of certain objectives. A program is action based and
result oriented
 Budgets

A budget is a statement of expected results expressed in

quantitative terms i.e. rupees, man hours, product units
Planning for a turbulent environment

Contingency planning Building Scenarios Crisis planning

It defines company Scenario building crisis planning
responses to be taken involves looking at enables managers to
in the case of current trends and cope with unexpected
emergencies, discontinuities and events that are so
setbacks, or visualizing future sudden and
unexpected conditions possibilities. devastating
 Planning for a turbulent environment

• Contingency planning
• Building Scenarios
• Crisis planning
 Contingency planning

Contingency plan defines company responses to be taken in the case

of emergencies, setbacks, or unexpected conditions
 Example -01

If sales fall 20 percent and prices drop 8 percent, what will the
company do?
Managers can develop contingency plans that might include
layoffs, emergency budgets, new sales efforts, or new markets
 Real life example from the Oscars

What happens if writers or actors go on strike just

before the annual Academy Awards show?
The Academy of Motion Picture Arts and Sciences has to have
contingency plans in place to put the show on using alternatives
such as film clips, historical background, and other out-of-the-
ordinary ideas.
 Building Scenarios

Scenario building involves looking at current trends and

discontinuities and visualizing future possibilities
Example

After the United states became involved in a military

operation in Libya in early 2011, leaders created four broad
scenarios of what might happen – two that were positive for
the United States and two that could have highly troublesome
consequences – and developed plans for how to respond.
 Crisis planning

Crisis planning enables managers to cope with unexpected events

that are so sudden and devastating that they have the potential to
destroy the organization if managers are not prepared with a quick
and appropriate response
Examples of Crisis
 Example -03

After several outbreaks of the HINI flu revealed the

dangers of widespread diseases, Mike Claver, State
Farm Insurance Company’s emergency management
superintendent, oversaw the development of a
through contingency plan designed to protect State
Farm employees during any potential outbreaks in the
future.
Continued…..

In addition to coordinating with area agencies and

encouraging employees to get vaccines, Claver tested
the company’s ability to function should managers
have to ask employees to work at home during the
outbreak.
Continued…..

More than 1000 people, about 10 percent of the workforce at

the Bloomington, Illinois, headquarters, logged into the
company computer network from their homes one august day.
Managers used the results of the dry run to fine-tune
contingency plans.
 Two Stages of Crisis Planning

Prevention
* Build relationships
* Detect signals from the environment

Preparation
Designate crisis management team and spokesperson
Create detailed crisis management plan
Set up effective communication system
 Example

After the Deepwater Horizon oil rig drilling a well for

BP exploded in the gulf of Mexico, U.S. congressman
Hentry Waxman (D-CA) observed that “ a striking
feature of the incident is the apparent lack of an
adequate plan to contain the spreading
environmental damage.”
BP’s CEO at the time, Tony Hayward, admitted
Waxman was right.
Because BP saw a deepwater leek as highly unlikely
and touted the Deepwater Horizon as one of the
world’s most technologically advanced drilling
platforms, it had no specific crisis plan for an
uncontrolled blowout.
Since then, BP has committed up to $ 1 billion to
cleaning up both the damage to the gulf and the
damage to the BP brand
 Innovative approaches to planning
• top executives or planning experts work with managers in major divisions or
Decentralized departments to develop their own goals and plans
planning

• reasonable yet highly ambitious and compelling goals that energize people and inspire
Stretch goals excellence

Business • It helps managers oversee plans and measure progress toward goals.
performance
dashboards

• a cross-functional group of people who work together to gain a deep understanding of

An a specific competitive issue and offer insight and recommendations for planning.
intelligence
team
 Limitations of planning

• Plans can create a false sense of certainty

• Plans may cause rigidity in a turbulent environment
• Plans can get in the intuition and creativity