1 | Planning & Control (Unit-II)

Planning:
Definitions of Planning by Different Authors:
 "Planning is the thinking process, the organized foresight, the vision based on facts and experience
required tor intelligent action." -Alfred and Beatty
 "Planning is the function that determines in advance what should be done. It consists of selecting
enterprise objectives, policies, programs, procedures and other means of achieving those objectives
In his planning the manager must decide which of the alternative plans are to be followed and
execute Planning is intellectual in nature. It is mental work. It is looking ahead and preparing for the
future"-Theo Hairnam
 "Planning is chalking out plan of action, i.e., the result envisaged in the line of action to be followed,
the stages to go through the methods to use." Fayol
 "Planning is deciding in advance what to do, how to do 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 happen." - Koontz &
O'donnell

Features of Planning:
1) Planning focuses on achieving objectives

 Organizations are set up with a general purpose in view.

 Specific goals are set out in the plans along with the activities to be undertaken to achieve the
goals.
 Thus, planning is purposeful.
 Planning has no meaning unless it contributes to the achievement of predetermined organizational
goals.
2) Planning is a primary function of management

 Planning lays down the base for other functions of management.

 All other managerial functions are performed within the framework of the plans drawn.
 Thus, planning precedes other functions.
 This is also referred to as the primacy of planning.
 The various functions of management are interrelated and equally important.
 However, planning provides the basis of all other functions.
3) Planning is all-pervasive

 It is needed at every level of management and everywhere in enterprise.

 It varies with scope of work.
 Top level involves in planning, middle level involves in departmental plans while lower level will
implement the same plan.
2 | Planning & Control (Unit-II)

4) Planning is continuous

 It serves as never-ending process due to dynamic business environment.

 It is prepared for particular time and is subject to revaluation and review.
 It remains continuous.
5) Planning is futuristic

 It is done for future.

 It requires peeping in future, analyzing it and predicting it.
 It is based on forecasting. o It is a synthesis of forecast.
 It is a mental predisposition for things to happen in future.
6) Planning involves decision making:

 It basically involves selecting from various alternatives.

 It is not applicable in single course of action as it attains no choice.
 The decision-making involves an integral part of planning.
 It gives more options to managers to select the best as per needs.
 It basically involves selecting from various alternatives.

7) Planning is a mental exercise

 It is a mental exercise which includes lucrative thinking, judgment and imagination.

 It involves not mere guesswork but rotational thinking.
 It depends on goals, facts and considered estimates.

Steps in Planning Process:

Identifying
Setting Developing Evaluating Selecting an Implementing Follow-up
alternative courses
Objectives Premises alternative courses alternative the plan action
of action

Types of Plans
 Single-use and standing plans
 Single-use plan
 Objective: Future destination or desirable undertakings.
 Strategy: Course of action developed by relating strengths and weaknesses of an
organization with opportunities and threats arising out of a mutable environment.
3 | Planning & Control (Unit-II)

 Program: A network of policies procedures, rules and budgets designed to meet specific
situations and all other needful actions mandatory for implementing a given course of action
is included in this phase
 Budget: This is a numerical expression of plan in terms of expected revenue and expenditure
over a given period of time.
 Standing Plans
 Policies: General statement that guides decision-making.
 Procedure: Administrative action guide, which sets the chronological sequence for action.
 Method: Detailed manner in which a specific activity will be performed.
 Rules: Directives for regulating and controlling the working behaviour of the employees.

PLAN

Operational Plan
Strategic Plan Tactical Plan Contigency Plan

Mission Single-use plan Standing Plan

Objectives Program Policies

Stragecties Budget Procedure

Rules

Operational Planning:
 Definition: Operational planning involves the day-to-day activities and processes that are
essential for the organization to function effectively.
 Key Components: Setting specific goals, allocating resources, establishing timelines, and
monitoring progress.
 Example: Production scheduling, inventory management, and workforce planning.

Strategic Planning:
 Definition: Strategic planning focuses on long-term goals and objectives, and how the
organization will achieve them.
4 | Planning & Control (Unit-II)

 Key Components: Identifying opportunities and threats, setting overall direction, making
decisions about resource allocation, and adapting to changes in the external environment.

 Example: Market expansion, new product development, and mergers/acquisitions.

What is the McKinsey 7S Model?

The McKinsey 7S Model refers to a tool that analyzes a company’s “organizational design.” The goal of
the model is to depict how effectiveness can be achieved in an organization through the interactions of
seven key elements – Structure, Strategy, Skill, System, Shared Values, Style, and Staff.

Structure

Staff Strategy

Shared
Values

Style Skill

System

Structure of the McKinsey 7S Model

Structure, Strategy, and Systems collectively account for the “Hard Ss” elements, whereas the remaining
are considered “Soft Ss.”

1) Structure: Structure is the way in which a company is organized – the chain of command and
accountability relationships that form its organizational chart.
2) Strategy: Strategy refers to a well-curated business plan that allows the company to formulate a
plan of action to achieve a sustainable competitive advantage, reinforced by the company’s mission
and values.
3) Systems: Systems entail the business and technical infrastructure of the company that establishes
workflows and the chain of decision-making.
4) Skills: Skills form the capabilities and competencies of a company that enables its employees to
achieve its objectives.
5) Style: The attitude of senior employees in a company establishes a code of conduct through their
ways of interactions and symbolic decision-making, which forms the management style of its
leaders.
6) Staff: Staff involves talent management and all human resources related to company decisions, such
as training, recruiting, and rewards systems
7) Shared Values: The mission, objectives, and values form the foundation of every organization and
play an important role in aligning all key elements to maintain an effective organizational design.
5 | Planning & Control (Unit-II)

SWOT Analysis
SWOT (strengths, weaknesses, opportunities, and threats) analysis is a method for identifying and
analyzing internal strengths and weaknesses and external opportunities and threats that shape current
and future operations and help develop strategic goals.

Strengths
Weaknesses
1. What is our
competitive advantage? 1. Where can we
2. What resources do improve?
we have? 2. What products are
3. What products are underperforming?
performing well? 3. Where are we lacking
resources?

Opportunities Threats
1. What new technology 1. What regulations are
can we use? changing?
2. Can we expand our 2. What are competitors
operations? doing?
3. What new segments 3. How are consumer
can we test? trends changing?
6 | Planning & Control (Unit-II)