Chapter 5 Planning

Question 1

Characteristics or importance of planning

Answer 1

Planning is an intellectual process.
Primary process
Universal process
A rational process
Focus on objectives
Leads to efficiency and economy
Increase Co-ordination
Flexibility
Practical
Pervasive
Continous

Question 2

Reasons for planning

Answer 2

Essential in Modern Business
Related to performance
Focus on Objectives
Proper Allocation of Resources
Facilitates Control
Helpful in Decision making
Avoiding business failures

Question 3

Characteristics of a good plan?

Answer 3

Clear Objective
Proper Understanding
Practical
Comprehensive
Flexible
Economical

Question 4

Advantages or significance of planning?

Answer 4

Facing complexities of Modern business
Forewarn against business failures
Attention On objectives
Minimising Uncertainities
Better Utilization of resources
Economy of Operations
Better Cordination
Encourages Innovation and creativity- New way of doing things
MANAGEMENT BY EXEPTION POSSIBLE
Facilitates Control

Question 5

Limitations of planning?

Answer 5

Lack of reliable Data
Difficulty in Selecting Best Alternative
Difficulty in taking Quick decision
Time consuming
Expensive
External factors may reduce Utility- Social political technological legal.
Sudden Emergincies
Resistance to Change/flexibility

Question 6

Principles of planning?

Answer 6

Principles of Contribultion to Objectives.

Po Primacy of planning.

Po of alternatives

Po timing

Po flexibility

Po Commitment

Po Competitive strategies

Question 7

Steps in Planning?

Answer 7

1.Recognizing need for action- Analyzing past present and future

2.Gathering Necessary Information-

3.Laying down objectives

4.Determining planning premises -
Forecasts are made on the following:

1.Expectations of demand for the products
2.The likely volume of production
3.Anticipation of cost and likely prices the product will be marketed
4.The supply of Labour, raw materials etc
5.Economic policies of the gov
6.Changing pattern of consumer preferance
7.The impact of technological changes on production process
8.the sources for supply of funds

5.Examining Alternative Course of Actions

6.Evaluation of Action Patterns- Evaluating the course of action. Studying performance of the various actions. Investments required and weighing it with others.

7.Determining Secondary Plans- Contingencies

8. Implementations of Plans

Question 8

Making plan Effective?

Answer 8

Consciousness for planning:
Initiative at the top level
Proper Communication
Participation in planning
Emphasis on long term and short term planning.

Question 9

Types of Planning?

Answer 9

On the basis of time: long term ,medium term ,short term
On the basis of managerial levels: Top level, middle level, lower level
On the basis of broadness : corporate level , department level
On the basis of use: multipurpose , single use

Question 10

On the basis of time?

Answer 10

On the basis of time:
long term ,- More than 3 years
medium term ,1-3 years
short term 1 year or less

Question 11

On the basis of managerial levels?

Answer 11

On the basis of managerial levels:
Top level,-
middle level, -
lower level-

Question 12

On the basis of broadness?

Answer 12

corporate level , department level

Question 13

On the basis of use?

Answer 13

OP SPR
Multi-purpose- Objectives, policies, strategies,Procedures, rules

Single use- Programmes, Schedules, Budgets

Question 14

Types of plans?

Answer 14

Three major types of plans can help managers to achieve their organizational goals.
1. Operational Plans
2. Tactical Plans
3. Strategic Plans

Tactical Plans: These are plans which usually span one year or less. It is concerned with what the lower level units within each division must do, how they must do it, and who is in charge at each level. Tactics are the means needed to activate a strategy and make it work.

Strategic Plan: It is an outline of steps designed with the goals of the entire organization in mind, rather than with the goals of specific divisions. It look ahead over the four, five or even more years to move the organization from where it currently to where it wants to be. Top managements strategic plan for the entire organization becomes the frame work and sets dimension for the lower level planning.

Contingency Plan: These plans are used when the original plan proves inadequate because of changing circumstances

Question 15

Operational Plan?

Answer 15

It is one that a manager uses to accomplish his or her job responsibilities. In other words, it is the plan used to achieve operational goals. Operational goals are the specific result expected from the departments, work groups and individuals.
Operational plans may be single use plans or ongoing plans.

Question 16

Single use plans?

Answer 16

Single use plans: It is applied to those activities which do not recur or repeat. A special sales programme is an example of single use plan, because , it deals with the who, what, where, how and how much of an activity. It includes:

(i) Budget: It is a statement of expected results expressed in quantitative terms for a definite period of time. It is prepared keeping in view the objectives , resources and of the enterprise. It is a useful control device and helpful in coordinating the activities. It predicts sources and amounts of income and how much they are used for a specific project.

(ii)Programme: It is a sequence of activities to be undertaken for implementing the policies and achieving the objectives of an organization. It tells what is to be done to achieve the goals

Question 17

Multipurpose or continuing plan?

Answer 17

Continuing or ongoing plans: These are usually made once and retain their value over a period of years while undergoing periodic revision and updates. The following plans are included in this category.

(i) Policy: It provides broad guidelines for managers to follow when dealing with important areas of decision making. It is basically a general statement that explains how a manager should attempt to handle routine management responsibilities. They are standing answers to recurring questions.

(ii)Procedures: A procedure is a set of step by step direction that explains how activities or task are to be carried out. An established procedure ensures uniformity of action. Most organization has procedures for purchasing supplies and equipments. By defining steps to be taken and the order in which they are to be done, procedures provide a standardized way of responding to a repetitive problem.

(iii) Rules: It is an explicit statement that tells an employee, what he or she can and cannot do. Rules are definite and rigid. Rules are “do” and “don‘t” statements put into place to promote the safety of employees and the uniform treatment and behaviour of employees. For eg. Rules about absenteeism permit supervisors to make discipline decision rapidly and with a high degree of fairness.

Question 19

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