Planning Class 12 Notes Business Studies Chapter 4 - CBSE

Chapter: 4

What Are Planning ?

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    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 Features of Planning
    Planning provides directions Planning focuses on achieving objectives
    Planning reduces the risks of uncertainty Planning is a primary function of management
    Planning promotes innovative ideas Planning is pervasive
    Planning facilitates decision making Planning is continuous
    Planning establishes standards for controlling Planning is futuristic
    Planning reduces overlapping and wasteful activities Planning involves decision making
    Planning is a mental exercise
    Limitations of Planning Process of Planning
    Planning leads to rigidity As planning is an activity, so there are certain logical steps which are to be followed by managers.
    Planning may not work in a dynamic environment Setting Objectives
    Planning reduces creativity Developing Premises
    Planning involves huge costs Identifying alternative courses of action
    Planning is a time-consuming process Evaluating Alternative Courses
    Planning does not guarantee success Selecting an alternative
    Implementing the plan
    Follow-up Action

    Types Of Plans

    Single use Plans Repeated Use/Standing Plans Other Plans
    • Budgets
    • Policies
    • Objectives
    • Programmmes
    • Procedures
    • Strategies
    • Projects
    • Methods
    • Rules

    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.

    Budgets Programmes
    Budget is a quantitative plan which includes facts, figures and numbers. Program includes policies, rules and procedures to achieve the objective.

    Standing Plans

    Policies Procedures Methods Rules
    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 Strategies
    Objectives are ends where the organization wants to reach. It is a plan to achieve organizational objectives.