Planning, Concept, Process & Importance, Management by Objectives

Nature of Planning

S

T

A

T

U

S

Current status

Desired

status

Gap

Planning required

Time

PLANNING:A RATIONAL APPROACH

• PLANNING: AN OPEN SYSTEM APPROACH

• PERVASIVENESS OF PLANNING

Corporate or organization level plan

Divisional Plan

Departmental Plan

Sectional Plan

IMPORTANCE OF PLANNING

1. Primacy of PlanningWhat kind of organization structure

What kind of people are required

How effectively to lead people

By furnishing standards of control

PLANS

Objectives and how to achieve them

Necessary for

Which helps to know

Which affects the kind of direction

In order to assure success of plans

• To offset Uncertainity and Change• To focus Attention on Objectives• To help in Control• To Increase Organisational Effectiveness

Planning Process

Controlling the plans

Establishing Objectives

Planning Premises

Communication of plans

Formation of derivative plans

Collection, analysis & classification of information

Determine alternative courses

Evaluating alternatives & selecting a plan

TYPES OF PLANNING

Dimensions Types of Planning

1. Coverage of activities

2. Time period involved

3. Approach adopted

4. Degree of formalisation

Corporate planning & functional planning

Long-term planning & short-term planning

Proactive planning & reactive planning

Formal planning & Informal planning

TYPES OF PLANS• Standing & Single-use Plans• Strategic & Operational Plans

Quotas & targets

Budgets

Programmes & projects

Procedures & rules

Policies

Strategies

Objectives

Mission or purpose

BARRIERS TO EFFECTIVE PLANNING

1. Difficulty of Accurate Premising

2. Problems of Rapid Change

3. Internal Inflexibilities• Psychological Inflexibility• Policy and Procedural Inflexibility• Capital Investment

4. External Inflexibilities• Political Climate• Trade Unions• Technological Changes

5. Time and Cost Factors

6. Failure of People in Planning

FEATURES OF A GOOD PLAN

1. Linked to Long-term Objectives

2. Direction for Action

3. Feasible

4. Simplicity

5. Flexible

PLANNING PREMISES

“Planning Premises are the anticipated environment in which plans are expected to operate. They include assumptions or forecasts of the future and known conditions that will affect the operation of plans.”

Types of Planning Premises• External Premises• Internal Premises• Tangible & Intangible Premises• Controllable & Uncontrollable premises

MANAGEMENT BY OBJECTIVES• It is a process where by the superior & subordinate managers of an

enterprise jointly identify its common goals, define each individuals, major areas of responsibility in terms of results expected of him & use these measures as guides for operating the unit & assessing the contribution of each of its members

• A process through which specific goals are set collaboratively for the organization as a whole & every unit & individual within it; the goals are then used as a basis for planning, managing organizational activities & assessing & rewarding contributions

Process

Establish Long Term Goals

Establish Specific Performance Objectives

Develop Action Plans

Appraise Results

Take Corrective action

IMPORTANCE OF MBO

• Better Managing• Effective Control & Appraisal• Clarity in Organization• Personal Commitment

LIMITATIONS OF MBO

• Failure to teach the philosophy• The Short Run Nature of Goals• Dangers of Inflexibility