Importance of Planning –
1. Provides Direction
o Clarifies goals and guides actions.
o Ensures employees and departments work in the same direction.
o Avoids aimless or conflicting efforts within the organisation.
KEYWORDS-
Clear goals/objectives
Guided actions
Defined direction
Work aligned with goals
2. Reduces Risks of Uncertainty
o Helps managers anticipate changes.
o Prepares the organisation for future uncertainties.
o Encourages proactive rather than reactive management.
KEYWORDS-
Anticipate changes
Future uncertainties
Advance preparation
Uncertain events
3. Minimises Overlapping ( confusion and chaos) and Waste
o Coordinates activities across departments.
o Reduces confusion, duplication, and inefficiencies.
o Saves time, effort, and resources by streamlining tasks.
KEYWORDS-
Avoids confusion
No duplication of efforts and Coordination of departments
Clarity in work and Smooth workflow
Eliminates wastage
4. Promotes Innovative Ideas
o Encourages new thinking at the planning stage.
o Supports growth and future planning.
o Provides space for creative problem-solving and experimentation.
KEYWORDS-
First function of management therefore help to generate New ideas
Concrete plans and Encourages innovation
Growth and prosperity
Creative thinking
5. Facilitates Decision Making
o Helps evaluate alternatives and choose the best one.
o Involves forecasting and target-setting.
o Makes choices more rational and less impulsive.
KEYWORDS-
Choice of alternatives
Evaluating options
Rational decision-making
Selecting best course of action and Helps in choosing wisely
6. Establishes Standards for Controlling
o Sets benchmarks for performance.
o Allows comparison of actual vs. planned performance for corrective action.
o Helps track progress and take timely corrective steps.
KEYWORDS-
Setting goals or standards
Basis of control
Comparison with actual performance
Find deviations
Corrective action
Measured performance
Prerequisite for controlling
Here’s a shortened version of the content in bullet and sub-point format, organized by the
types of plans:
🔹 Types of Plans
1. Single-use Plans
Used for one-time, non-recurring activities.
Definition: Plan created for a unique project/event; not repeated.
Examples:
o Programmes: Steps for a new department setup.
o Projects: Similar to programmes but vary in scope/complexity.
o Budgets: Numerical statement of income & expenses for a specific period.
Purpose: Helps in achieving short-term operational goals.
A Programme
Definition: Detailed plan including objectives, procedures, rules, tasks, and resources.
Features:
o Combines multiple planning elements.
o Guides execution of specific business initiatives.
B Budget
Definition: Numerical plan of expected results.
Examples:
o Sales Budget: Sales forecast for a region/product/month.
o Cash Budget: Estimated cash inflow/outflow to manage liquidity.
Features:
o Used for planning & control.
o Helps detect deviations and take corrective actions.
2. Standing Plans
Used for recurring, regular activities.
Definition: Ongoing plans for routine decisions; modified as needed.
Examples:
o Policies: General guidelines (e.g., admission, pricing, recruitment).
o Procedures: Step-by-step methods (e.g., reporting, requisition).
o Methods: Specific way to perform a task (e.g., training methods).
o Rules: Specific instructions; no flexibility (e.g., attendance timing).
Purpose: Ensures consistency and efficiency in day-to-day operations.
1. Policy
Definition: General statements to guide decision-making.
Features:
o Helps interpret strategy.
o Provides basis for action.
Example: Purchase policy (make vs buy, vendor selection).
2. Procedure
Definition: Step-by-step instructions for recurring tasks.
Must be Chronological in order and logical sequence (Keyword)
Example: Procedure for production supply requisition.
Purpose: Enforce policies and reach objectives.
3. Method
Definition: Prescribed way/Manner of doing a specific step within a procedure.
Example: On-the-job training vs seminars for employee training.
Purpose: Enhances efficiency, saves time and cost.
4. Rule
Definition: Specific statement of what must/must not be done.
Features:
o No flexibility.
o Simplest form of plan.
Example: "Report to work at 9:00 AM."
. Objectives
Definition: Desired outcomes or results the organisation aims to achieve.
Examples: Increase sales by 10%, earn 20% profit.
Features:
o Set by top management.
o Serve as a guide for planning across departments.
o Must be specific and measurable.
. Strategy
Definition: Comprehensive plan for achieving long-term objectives.
Dimensions:
o (i) Set long-term objectives.
o (ii) Choose a course of action.
o (iii) Allocate necessary resources. (KEYWORD)
Example: Marketing strategy (target customers, pricing, promotion).
Note: Must consider external environment (economic, political, etc.).
