Planning Process
1.Setting objectives: planning begins with setting up of objectives. The managers set up objectives keeping in mind the physical and financial resources. Managers prefer the goals which can be achieved quickly and with less time.
2. Developing premises: premises means making assumptions for the future. Before listing out the alternative ways of achieving the objectives, manager makes some assumptions for each such alternative. For example of the alternative is to increase in sales by increasing more line of products then assumption can be that the increased production will automatically lead to increased sale.
3. Listing various alternatives: After setting of objectives the managers makes a list of alternatives through which the organization can achieve its objectives. For example, if the objective is to increase sales, then the alternatives may be :
-Adding more lines of products.
-Offering discount.
-Increasing expenditure on advertisements.
-Increasing share in the market.
-Appointing more salesmen.
4. Evaluating alternatives: After making the list of alternatives, the manager starts evaluating each and every one of it to note down their positive and negative aspects. Then he starts eliminating the alternatives with more of negative aspects.
5. Selecting the best alternative: The alternative with the most positive aspects is then selected. Sometimes instead of selecting one alternative, a combination of different alternatives is selected.
6. Formulation of supporting plans: After making the main plan, a number of small or supporting plans are made related to the performance of routine jobs. They are also called derivative plans. For example if the plan was to import Japanese technology, the supporting plan would be from where to import, selection of employees to operate such machine, finance required to buy and so on.
7.Implementing the plan: Plans are of no use until they are put in action. The managers then start communicating the plans to all employees very clearly. After such communication, the mangers start acting on the plan with their support.
8. Follow up: The managers monitor the plan very carefully while it is implemented. This helps him to verify whether the predictions assumed while planning are holding true or not. If these are not, then immediate changes are made in the plans in order to ensure their success.