Most of us are fairly familiar with the meaning of planning in our everyday life. We do often decide in advance about the things to be done on a busy working day. Parents make advance decisions on the education of their children. As students, you may think in advance how to go ahead with the preparation for your examination? How to make use of your time in the best possible manner and so on? Laymen understand planning as some systematic way of deciding about and doing things in a purposeful manner.
However, in the context of formal organisations and their management, the concept of planning has a specific connotation. It means deciding in advance what is to be done in the future for a specific period and then taking the necessary steps to do the things decided upon. It means looking ahead into the future and trying to anticipate what is it likely to be, how will it affect the organisation, what direction the organisation should take, and how to cope with the future events? Planning also implies determination of courses of action from among alternatives to achieve the goals of the organisation, both in the immediate future and in the long run. The very notion of planning brings to mind such images as neat, orderly and disciplined approach to work, goal-oriented behaviour, thinking about and arranging things in advance, careful allocation of scarce resources, and so on. In short, planning may be defined as the process of setting future objectives and deciding on the ways and means of achieving them.
Nature And Characteristics Of Planning
The managerial function of planning has certain unique characteristics of its own, which distinguish it from the other managerial functions. It also shares a few characteristics with other managerial functions. All the characteristics together reflect the nature of the planning function. They are discussed as below:
i) Primacy of planning : Planning precedes all other managerial functions. The process of management begins with planning. Planning provides the basis for the subsequent functions of organising, staffing, directing and controlling, though all the functions are highly interrelated and are equally important. Planning is the prime function from which the other functions get the necessary base.
ii) Planning as a process : Planning is a process involving a few stages or steps. It is a sub-process of the process of management. The planning process begins with identification of mission and goals of the organisation and ends with making arrangements for implementation of plans.
iii) Pervasiveness of planning : Planning is a pervasive function of managers at all levels of the managerial hierarchy, right from the chief executive down to the first line supervisor. However, the content and quality of the function differ from level to level. The time devoted to planning also differs. Typically, the chief executive and other top level managers concentrate on corporate-wide planning function. Their decisions on planning have far-reaching effects on the organisation. Managers at middle and lower level shave more limited planning functions.
Planning is also pervasive across the various organisational functional areas. In a manufacturing enterprise, for example, we come across such planning activities as production planning, materials requirements planning, manpower planning, financial planning, and so on.
iv) Future orientation : Planning is invariably future-oriented. Henri Fayol defined planning as the process of looking ahead (thinking ahead) and making provision to tackle future events and situations. The concern for future makes sense to the extent that planning is intended to cope with uncertainties and unknowns which unfold themselves as one marches into the future.
It is needless to state that planning cannot be anything other than future-oriented; one does not plan for the past and the present. Of course, while planning for the future, managers consider the relevant events and situations of the past and the present within and outside the organisation.
v) Information base : Planning is backed by information. Without information, planning exists in a vacuum. Information on the past trends, current conditions and future possibilities are essential for planning. Information is needed to diagnose planning issues and problems, to develop alternative courses of action, to evaluate them and to make final choice of plans.
vi) Rationality : Planning is a rational managerial activity. It implies that planning is a purposeful and conscious managerial function. It is backed by adequate information, knowledge and understanding. Managers who are planners are somewhat objective and fair in their approach to planning. They have a reasonably clear idea of the planning issues and know how to tackle them. They make planning decisions with some awareness of their consequences.
vii) Formal and informal nature : Planning has both formal and informal elements. Formal planning refers to a systematic and rigorous process of arriving at planning decisions through investigation and analysis of the various factors. Formal planning is more explicit, and open; responsibility for various aspects of planning is pinpointed among managers. Plans are put into writing and are communicated through the organisational channels of communication to the various managerial levels.
Informal planning is done by managers through an intuitive process. Managers carry plans in their heads in the form of specific but flexible intentions and communicate them to others through word of mouth. Informal planning may also be viewed as a trial and error, fragmented, intermittent process as against a systematic step-by-step and logical process of formal planning.
viii) Intellectual process : Planning is an intellectual process and requires certain conceptual skills. It requires abilities to think both in abstract and concrete terms, to visualise and look ahead into the future and to form ideas and images of future expectations and desires. Planning also calls for intellectual abilities to anticipate opportunities and threats in the environment, to diagnose problems, develop alternative courses of action, and analyse them for choosing the right course.
ix) Pragmatic, action-orientation : Although planning is an intellectual thinking activity, it is primarily pragmatic and action-oriented. Planning precedes action and is often described as action laid out in advance. To think before acting and to decide before doing are part of the discipline and culture of planning. The focus is on action ability of plans, i.e., their quality of being implementable. Planning is also reality-oriented.
x) Planning as a form of decision making : Planning involves problem solving and decision making. It is a process of identification of issues and problems needing decisions, collection of relevant information, evaluation of alternative courses and choices of the most appropriate alternative. Decisions are made on organisational objectives, strategies, policies, programmes, procedures and other plans. They are all choices from alternatives. They also involve mobilisation, allocation and commitment of resources and efforts in specific ways.
xi) Planning premises : Planning is based on certain assumption and estimates about the future behaviours of events and situations in the environment. These are formally known as planning premises which are derived through the process of forecasting. Without such assumptions planning becomes an empty speculative exercise. Managers make promises or assumptions about the future events for purposes of planning, in order to have a sense of security and certainty in the midst of grave uncertainties and complexities of the environment.
xii) Dynamism : Planning is a dynamic process. It is a process of making the organisation selectively move and change in tune with relevant changes in the external environment. It is a process of building flexibility and adaptability into the functioning of the organisation. It is a process of making continuous assessment and reassessment of the goals, resources, directions, opportunities and problems of the organisation and converting them to serve its needs.
xiii) Levels of planning : Planning is often divided into a few levels on the basis of their scope, significance and time span. On the basis of scope, there are two levels: (1) corporate planning covering the entire organisation, and (2) sub-corporate or functional planning carried on within the various functional units or divisions. On the basis of significance, we may divide planning into strategic planning and tactical or operational planning. On the basis of time span, there are two levels: (1) long-range planning covering periods of more than one year in general, and (2) short-range planning covering a period of one year or less.
The division of planning into various levels facilitates analysis of the dimensions and critical elements of planning. Even so, planning is an integrated function. Thus, different levels of planning should be balanced and coordinated so that they support one another.
xiv) Types of plans : The process of planning produces several types of plans which may be viewed as a series or hierarchy of decisions and ‘action packages’. They include: objectives or goals, strategies, policies, programmes, budgets, schedules, procedures, methods, rules and so on. Some of the plans such as objectives and budgets serve as integral elements of the planning process while others such as policies, procedures, rules and methods serve as facilitating tools for smooth planning. All the plans are categorised into two broad groups: (i) single use plans, and (ii) standing plans. Single use plans are those which are designed to meet specific, non-repetitive and unique situations, while standing plans are those which are fairly stable and are meant to handle a wide range of repetitive situations over a period of time.
