Introduction to Management

Chapter Two
The planning function
 Definition
Planning is the most important function of manage-
ment.
encompasses defining the organization’s objectives or
goals, establishing an overall strategy, and developing
a comprehensive hierarchy of plans to integrate and
coordinate.
 It is concerned with ends (What is to be done) and
with means (how it is to be done).
Need for planning
 Minimizes risk and uncertainty
Leads to success: Planning does not guarantee suc-
cess
 Focuses attention on the organization’s goal
 Facilitates control
The planning process (Steps in
planning)
 Understanding of the existing situation
 Forecasting
 Establishing objectives
 Determine alternative courses of action
 Evaluating alternative course of action
 Selecting Course of Action
 Formulating Derivative Plans
 Numberzing plans by Budgeting
 Implementing the plan
 Controlling and evaluating the results
 Types of plan
 Plans can be classified on different bases or dimensions.
Repetitiveness
Time dimension, and
Scope/breadth dimension
 Types of plan

Classification of plan based on repetitiveness

A. Standing plans: are established set of decisions
used by managers to deal with recurring or organiza-
tional activities.
 The standing plans include the following:
a) Purpose b. Objectives c. strategies d. poli-
cies e) Procedures f. methods g. rules
Types of plans(continued)
Purpose (Mission):

Objectives: The objective of business organization is the genera-

tion of profit by fulfilling their purpose.
Objectives are sometimes called goals
Strategies: They focus on the ways and means to achieve the es-
tablished objectives.
Strategies are major courses of actions that an organization
plans to take in order to achieve its objectives.
Types of plans(continued)
 An objective with out strategy is impossible to
achieve.
Policies: - A policy is a general guide line for decision
making.
It sets up boundaries around decisions, including
those that can be made and eliminating those that
cannot.
Procedures: A procedure provides a detailed set of in-
structions for performing a sequence of actions that
occurs often or regularly.
Types of
plans(continued)

 They are guides to action rather than thinking.

Methods:
 It is even more detailed than a procedure.
 Where a procedure shows a series of steps to be
taken a method is only concerned with a single
operation with one particular step.
 It tells exactly how a particular step is to be per-
formed.
Types of
plans(continued)
Rules:
 They are plans which tell us the actions required
and non- required
 They tell us what we should do or should not do.
Example: No smoking, No personal phone calls, No
unauthorized personnel.
Types of plans(continued)
2. Single- use Plans:
will not be repeated in the same form in the future.
 They are plans which are prepared for a particular
situation.
Example: a rapidly expanding firm, planning to set
up a new ware house, will need a specific single-use
plan. It will not use existing warehouse plan
Types of plans(continued)
The major type of single use plans include:
a. Programs b. Projects c. Budgets
Programs:
They are complex of goals, policies, procedures,
rules, task assignments, resources to be employed
and other elements to carry out a given course of
action.
 After achieving the short time requirements, the
combinations cease to exist (programs) but the
plans continue to exist.
Types of plans(continued)
Projects:
Projects are smaller, separate portions of programs limited
scope and distinct directives concerning assignments and time.
The accomplishment of the program depends on the achieve-
ments of the projects.
Budgets:
A budget is a single use plan that states projected income and
expenditures for specific period of time.
Budgets are statements of the financial resources or numbered
plans set aside for specific activities in a given period of time
Types of plans(continued)
Budgets are primary devices to control an organiza-
tion’s activities
Budgets are thus important components of programs
and projects.
 Types of plans(continued)
Classification of plans based on time:
a. Long range b. Intermediate range c. Short range
Long range plans:
It covers a longer time horizon and is concerned with the distant fu-
ture.
 This type of plan covers a time period of five years and above.
Intermediate range plans:
 Is a plan designed for a period which is between the long range and
the short range.
 These plans are complementary of the long range plans.
Types of plans(continued)

Short range plans:

They are plans that are not prepared separately.
They constitute the steps towards the implementation of long
rage plans.
They deal with the immediate future actions.
Types of plan (continued)
Plans based on scope or breadth
These are:
Strategic planning:
It is the process of analyzing and deciding on the organization’s
mission, objectives, major course of actions or strategies and
major resource allocations.
 It deals with broad issues and performed by top level man-
agers.
 It is a long-range planning that focuses on the organization as
a whole.
Types of plan(continued)
Tactical planning:
They are to convert the strategic plans into action
plans.
Example:
 Developing annual budget for each department,
division and project, choosing specific measures of
implementing strategic plans.
 Deciding on the courses of actions for improving
current operations.
Types of planning (contin-
ued)
Operational planning:
It is most specific and detailed action plan.
 It is made at the operating level and concerned
with the day to day, week to week execution of the
organizational activities.
 They tell exactly and specifically what should be
done in the short range.
 They are action plans.
Planning techniques
Here are some of the most effective techniques:
 1. SMART Goal Setting:

 Specific: Clearly define what you want to achieve.

 Measurable: Set quantifiable targets to track progress.
 Achievable: Ensure your goals are realistic and within your
reach.
 Relevant: Align your goals with your overall objectives and
values.
 Time-bound: Set specific deadlines to create a sense of ur-
gency.
Planning techniques
2. Prioritization Techniques:
Eisenhower Matrix: Categorize tasks based on ur-
gency and importance:
 Urgent and Important: Do these first.
 Important but Not Urgent: Schedule these.
 Urgent but Not Important: Delegate these if possible.
 Neither Urgent nor Important: Eliminate these.
Planning techniques
Planning techniques
 ABCDE Method: Assign letters to tasks based on
their priority:
 A: Must-do tasks.

 B: Important tasks.
 C: Nice-to-have tasks.
 D: Delegate-able tasks.
 E: Eliminate-able tasks.
Planning techniques
Gantt Charts: Visualize project timelines and depen-
dencies
 Strategic Planning Techniques:

SWOT Analysis: Identify your strengths, weak-

nesses, opportunities, and threats
End