Chapter: 4

What Are Planning ?

Planning is deciding in advance what to do and how to do. Planning is closely connected with creativity and innovation. Planning involves setting objectives and developing appropriate course of actions to achieve these objectives.

Importance of Planning

  • Planning provides directions
  • Planning reduces the risks of uncertainty
  • Planning promotes innovative ideas
  • Planning facilitates decision making
  • Planning establishes standards for controlling
  • Planning reduces overlapping and wasteful activities

Features of Planning

  • Planning focuses on achieving objectives
  • Planning is a primary function of management
  • Planning is pervasive
  • Planning is continuous
  • Planning is futuristic
  • Planning involves decision making
  • Planning is a mental exercise

Limitations of Planning

  • Planning leads to rigidity
  • Planning may not work in a dynamic environment
  • Planning reduces creativity
  • Planning involves huge costs
  • Planning is a time-consuming process
  • Planning does not guarantee success

Process of Planning

As planning is an activity, so there are certain logical steps which are to be followed by managers.

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

Types Of Plans

Single use Plans

  • Budgets
  • Programmmes
  • Projects

Repeated Use/Standing Plans

  • Policies
  • Procedures
  • Methods
  • Rules

Other Plans

  • Objectives
  • Strategies

Single Use Plans

A single-use plan is developed for a one-time event and they are not likely to be repeated in future. The duration of this type of plan depends upon the type of the project.


Budget is a quantitative plan which includes facts, figures and numbers.


Program includes policies, rules and procedures to achieve the objective.

Standing Plans


Policies are the general guidelines which are to be followed by the organization.


Procedure includes the steps which are to be followed to complete the task or an activity.


Method is the way in which task is to be performed.


Rules are specific statements which are rigid in nature

Other Plans


Objectives are ends where the organization wants to reach.


It is a plan to achieve organizational objectives.