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Planning is deciding in advance what is to be done in the future

According to Koontz and O Donnell it is deciding in advance what to do, how to do it, when to do it and who is to do it. Planning bridges the gap from where we are to where we want to go. It makes it possible for things to occur which would not otherwise happen Planning is a step that involves mapping out exactly how to achieve a particular goal.

Four

major factors summarize the essential nature of planning. These are:

1. Contribution to purpose and objectives - planning is required to facilitate accomplishment of business purposes and objectives. This statement is taken from the nature of organized business.

2. Planning as the first basic function 3. Planning as a function of all managers - Planning is a function of all managers, although the character and scope of planning will differ from one authority to another. 4. Planning for efficient organization

Objectives or goals - it can use interchangeably. it is the ends toward which activity is aimed. Estimated result expected in future - identifies the basic purpose or function or tasks of an enterprise or agency or any part for the existence of an organization.

Mission

Programs - are a complex of goals, policies, procedures, rules, task assignments, steps to be taken, resources to be employed, and other elements necessary to carry out a given course of action. Project scheduling- refers to the identification and analysis of the activities from the project planning stage up to the start of normal operations. Policies - are general statements or understandings that guide or channel thinking in decision making

Procedures

- are plans that establish a required method of handling future activities


Rules

- spell out specific required actions or no actions, allowing no discretion


Budget

- is a statement of expected results expressed in numerical terms.

Philosophy

- it is the value and the beliefs of an organization holds as the guiding light. These are usually passed on by the founder of the organization.
Strategy

- it is the method of shaping a companys future and involves determining the long-run direction of the organization. A company may have the strategy to diversify into related business within the next few years.

Breadth Planning (a) Strategic plans- plans are apply to entire organization and establish organizational overall goals. Cover extended periods of time. (b) Operational plans- encompass a particular operational area of organization. These are not broad like strategic plans but narrow. It specify the details of how the overall goals are to be achieved. Cover short time period

Time

frame of planning

(a) Long term plan- are those with a time

frame of 3-5 years. (b) Short term plan- are those that cover year or less. (c) Intermediate plans- Any time period between long term and short term plan.(1-3 years)

Specificity

of planning

(a) Specific plans- are clearly define and leave no

room for interpretation, these state its objectives in a way that eliminates ambiguity and problems with misunderstandings.
Flexible plans that set out general guidelines, provide focus, yet allow discretion in implementation

(b) Directional plans- plans are flexible that setout

general guidelines to deal with high uncertainty and ambiguity.

Frequency

of use planning
need of a plans that performed rules and

(a) Single use plans is one time plans

specifically designed to meet the unique situation. (b) Standing plans are ongoing provides guidance for activities repeated. Its include policies, producers.

Business

Planning - created through time as a series of ideas is gradually developed. Effective plans are not written in one sitting. Each part of plan leads into the next. Each influences the other; all parts are interdependent.

Define

the business Idea. - description of the business idea. - make it precise, concise and specific) Establish goals and objectives Evaluate the ideas, goals, and objectives Forecast Cash needs Identify sources of funds Write a business plan

Decision is a choice between alternatives.


Decision making is the process of choosing one alternative over the others.

Making good decisions should be a process. It is a process of identifying problems and resolving them, or of identifying opportunities and taking advantage of them.

a process of evaluating alternatives Choice a process of selecting a specific alternative to implement


Judgment

Judgment can occur without being followed by choice. However, some level of judgment will always precede choice.

There Here

are many decision-making models.

is another that is not nearly as insightful as the one above, but it is one that many of the students will be familiar with.

1. Identify the problem. 2. List alternatives. - brainstorming

3. Select the best alternative. 4. Implement the chosen alternative. 5. Evaluate.

There are various quantitative and specific techniques that are available to aid the manager in his planning process. Some of these are the following:

1. Forecasting. This is an attempt to foretell or predicts future trends, events, or conditions from known data and to prepare for the expected changes in business or industry.

Many decisions are based on estimates of what is likely to happen in the future. It was merely based on the analyses of past and present, are called forecasts.

Managers merely rely on their own intuition in predicting the future events

There

are no universal forecasting methods; some commonly used methods of forecasting are:

Survey

Method Trend Method or time series analysis Economic Method

2. Break-even Analysis. -is used to determine the point at which all fixed costs have been recovered and profitability begins.

Fixed cost (FC) Variable costs (VC) Total Fixed Costs (TFC) Price (P)

3. Scheduling. - Schedules plans that allocate resources by detailing what activities have to be done, the order in which they are to be completed, who is to do each, and when they are to be completed. Represent the coordination of various activities.
Network

analysis- quantitative technique used for scheduling PERT and CPM

4. Management by Objectives (MBO) - it is an approach to management designed to encourage initiative and prevent working at cross-purposes, or indeed, for no purpose at all.

Lack of real commitment in planning Interchanging planning studies with plans Failure to develop and implement sound strategies Lack of meaningful objectives and goals Tendency to underestimate the importance of planning premises Failure to see the scope of plans Failure to see planning as a rational process Too much reliance on experience Failure to use the principle of limiting factor Lack of top management support Lack of clear delegation Lack of adequate control techniques and information

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