Session 03

Kalpana Ambepitiya
MBA (Finance) (IGNOU-India), MPA (Colombo-Sri
Lanka), PGD (Finance) (IGNOU-India), PGD
(Management) (IGNOU-India), BBMgmt Hons
(Marketing) (Kelaniya-Sri Lanka)

Planning

A primary managerial activity that involves:

Defining the organizations goals
Establishing an overall strategy for achieving those
goals
Developing plans for organizational work activities

Formal planning
Specific goals covering a specific time period
Written and shared with organizational members

Set the standards

to facilitate control

Provide
direction

Managers
engage in
planning
to:

Minimize waste and

redundancy

Reduce the
impact of change

Planning
The process of setting objectives and
determining how to best accomplish them.
Objectives
Identify the specific results or desired
outcomes that one intends to achieve.
Plan
A statement of action steps to be taken in
order to accomplish the objectives.

 Improves focus and flexibility.

Improves action orientation.
Improves coordination.
Improves time management.
Improves control.

Short-range and long-range plans

= 1 year or less
Short-range plans
Intermediate-range plans = 1 to 3 years
= 5 or more
Long-range plans
years
Higher management levels focus on longer
time horizons.

Strategic and operational plans

Strategic plans set broad,
comprehensive, and longer-term action
directions for the entire organization.
Operational plans define what needs to
be done in specific areas to implement
strategic plans.

Production plans
Financial plans
Facilities plans
Marketing plans
Human resource plans

Policies and procedures

Standing plans
Policies and procedures that are
designed for repeated use.
Policy
Broad guidelines for making decisions
and taking action in specific
circumstances.
Rules or procedures
Plans that describe exactly what actions
are to be taken in specific situations.
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 Budgets and project schedules

Single-use plans
Only used once to meet the needs and

objectives of a well-defined situation in a timely

manner.
Budgets
Single-use plans that commit resources to
activities, projects, or programs.
Fixed, flexible, and zero-based budgets.
Projects
One-time activities that have clear beginning
and end points.
Project management and project schedules.
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Type of Plan

Time Frame

Specificity

Frequency
of Use

Strategic

Long Term

Directional

Single Use

Tactical

Short Term

Specific

Standing

Operational

Ongoing

Very detailed

Day-to-day

Policies,
procedures,
and rules

Varies

Varies

Varies
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1. Review the organizations mission statement.

Do goals reflect the mission?

2. Evaluate available resources.

Are resources sufficient to accomplish the mission?

3. Determine goals individually or with others.

Are goals specific, measurable, and timely?

4. Write down the goals and communicate them.

Is everybody on the same page?

5. Review results and whether goals are being met.

What changes are needed in mission, resources, or goals?

Several contingency factors that affect planning can be

identified.
A. Managerial Level in the organization. Operational
planning usually dominates the planning activities of
lower-level managers. As managers are promoted
through the levels of the organization, their planning
becomes more strategic.
B. Degree of environmental uncertainty. The greater the
environmental uncertainty, the more plans should be
directional and emphasis placed on the short term.
C. Length of future commitments. The commitment
concept says that plans should extend far enough to
see through current commitments.

1. Establishing a formal planning

department/Unit/group
A group of planning specialists who help managers write
organizational plans.
Planning is a function of management; it should never
become the sole responsibility of planners.

2. Involving organizational members in

the process
Plans are developed by members of organizational units
at various levels and then coordinated with other units
across the organization.