Methods of Planning

Methods of Planning

Planning consists of several individual plans depending upon nature and scope. it can be classified as follows:

Repeated use plans

These plans can be used again and again. The elements of standing plans are

1. Objectives

Objectives are the end towards which the activities of an organisation are directed. For planning, objectives are essential. Planning has no meaning if it is not related to objectives. Objectives are useful for all managerial purposes. It is expressed in measurable statement in written form. For example, hire and fully train five new customer service staff members by June 30.

2. Policy

Policies provide the framework within which the decision makers are expected to operate while making the decisions relating to the organisation. They are the guide for thinking and the action of subordinate for attaining the goal. It shows the limit within which the organisational decisions have to be made. For example, an enterprise may follow a policy of selling its products only on cash basis.

3. Procedure

A procedure will lay down the manner in which certain work has to be performed. It prescribes the sequence of operations to be carried out to complete a given task. For example, procedure is laid down in an organisation for purchase of raw material, selection of employees, etc.

4. Methods

Methods specifies the way in which a particular step is to be performed, procedure tells the various steps to be taken to perform a particular task, but method tells how a particular step in the procedure is to be performed. The definition of a method is a system or a way of doing something. An example of a method is a teacher’s way of cracking an egg in a cooking class.

5. Rules

A rule specifies the people to do or not to do certain things. They are always rigidly enforced. For example, no smoking in working place, wear uniform in factory etc,. There is always a fine or penalty for the violation of rules.

6. Strategies

Strategy is a term which is normally used in battlefield for planning a military movement, handling of troops, etc. In business, strategy means tactics adopted to counter competitor’s actions. It is also concerned with meeting the challenges posed by the policies and the actions of the competitors in the market. For example, keeping prices low to attract more customers. Since profit margins are very low, the business must sell a lot of products to make money.

Single use plan

Single use plan are used for a specific purpose only. As soon as the purpose is over the plan becomes useless. Programmes and budgets are the examples of single use plan.

1. Programme:

Programme specific the date and time by which the activities of the enterprise will be carried out. Programme may be major or minor in nature. For example, to sell 10,000 cycles by the end of the year is the sales programme of the company.

2. Budget:

A budget is the financial plan of a business. It is expressed in numerical terms. A budget is a plan you write down to decide how you will spend your money each month. A budget shows you: how much money you make? And how you spend your money?

Before preparing the budget, the past happenings, the present needs and future trends are taken into account. Budget is always prepared for specific period of time i.e., for a month, for half year or whole year. A budget helps you decide: what you must spend your money on? And if you can spend less money on some things and more money on other things. For example, your budget might show that you spend Rs.1000 on clothes every month. You might decide you can spend Rs.500 on clothes. You can use the rest of the money to pay bills or to save for something else.