Chapter – IV

Planing
(6-marks)

Define Planning? – 1 mark (part of the question)

Planning means

• making decisions with regards to goals to be achieved and
• the methods to be adopted to achieve those goals.

Explain briefly 6 steps in PLANNING PROCESS OR in FORMULATION OF A PLAN – 6

DCDCFPF : the steps should be answered in sequence

1. Defining objectives
   1st step-of the management is to develop a plan and set some clear and specific objectives, which should stipulate the areas where organized planning must occur.
2. Choosing alternatives:
   2nd step - the manager should ascertain as many available alternatives as possible for reaching those objectives and he should explore all those alternatives without going into the merits and demerits of those alternatives.
3. Developing planning premises:
   3rd step - the manager should list all the premises (assumptions) for each alternative and then determine the feasibility of using any one alternative to reach its objectives.
4. Choosing the best alternative:
   4th step - the manager should evaluate all the alternatives + the premises on which the alternatives are based so that the unreasonable alternatives can be eliminated from further consideration and the best alternative can be decided to achieve the objectives of the organization.
5. Forming supportive (derivative) plans: (Explain the meaning of supporting plans with the help of a suitable example?
   After forming the main plan, secondary plans are derived in order to support and expedite the achievement of the main plan. These secondary plans are known as derivative or supportive plans.
   For example – once the production plan is prepared, secondary plan would be to buy equipment, raw material, recruit and train staff, develop new product, etc. These derivative plans are formed on the basis of the main plan and therefore support it.
6. Putting the plan into action:
   Once plans are developed, they are ready to be put into action. The organization does not benefit from the planning process until this step is carried out.
   For example – if the firm decides to promote sales through advertising, then the company should engage an advertising agency to go ahead with the advertising otherwise the company will not achieve its desired results.
7. Following up:
   Once the plan is put into action, it should be monitored because in the course of implementing the plan, many adjustments may be required in order to achieve the given objective.
   NOTE: if any additional correct point is added at any relevant stage without violating the sequence, full credit should be given. If sequence is not maintained, 2 marks are deducted...............