Types of Planning
Planning can be classified into different categories on the following basis.
(a) Formal planning
(b) Informal planning
(a) Formal planning: Officially recognized planning is known as formal planning. Formal plans are normally in writing. Formal Planning allows to manage the future and improves organisational productivity and increase profitability.
(b) Informal planning: Informal planning will not be in writing. Informal planning will be effective only when the number of action is less.
(a) Short term planning
(b) Long term planning
(a) Short term planning: The Period of short term plan is one year or less than one year. Short term plans are prepared in detailed manner. It must be formulated in a manner consistent with long term plans. Such plans may relate to the following matters:
· Purchase of raw materials.
· Preparation of budgets.
· Arranging the employees for training etc.,
(b) Long term planning: The period covered by the long term plan is usually 5 to 15 years. The management and special planning officials prepare long term planning. Long term planning is also known as strategic planning. Some of the examples of long term planning are:
· Introduction of new product
· Changing the techniques of production
· Expansion of business
(a) Strategic planning
(b) Intermediate planning
(c) Operational planning
(a) Strategic planning: The strategic planning is the process of detecting overall objectives of the organisation, policies and strategies adopted to achieve the objectives. It is conducted by the top level management and may cover a time period of up to ten years.
(b) Intermediate planning: Intermediate planning covers a period of six months to two years. Intermediate planning is done by middle level management. They refine broad strategic plans into more workable and realistic plans.
(c) Operational planning: Operational planning deals with the current activities. It keeps the business running. These plans are operated by the lower level management and conducted by supervisor, and it covers a period of one week to one year.
(a) Standing plan ( repeated use plans)
(b) Single use plans
(a) Standing plans: Standing plan is one, which is designed to be used again and again. They give guidelines regarding the activities that occur frequently. Objectives, policies, procedures, methods, rules, and strategies are included in standing plans. It helps the executives to reduce the workload.
(b) Single use plan: Single use plans are used once for a particular circumstance. They are non-recurring and flexible in nature. Programme, budget, schedule are included in single use plan. It is also called specific planning.