Process of Planning

Process means carrying out an activity through a serried of events. Steps involved in the planning process are described below:

1. Need for planning:

The managers realize the need for planning as a first step to planning. The need sets the climate for planning. If sales are declining, the need for planning arises in the sales department. Organizational resources are identified, demarcated and allocate to the specified area.

2. Identification of goals:

After the need is determined, planners identify what they want to achieve through planning. Clear identification of goals helps in optimum allocation of resources and effective implementation of plans. Objectives must be framed for the organization as a whole, for different departments and for different levels of each department. The objectives must be clearly communicated to all the organizational members so that plans can be effectively implemented.

3. Analysis of present situation:

Being clear of what to achieve, the planners must knew how equipped they are to achieve their targets. They analyse the organization’s present resource position (Physical, financial, information human etc.) and it s internal and external environment.

4. Identify barriers to planning:

Planning cannot be effective if members (those who plan and those who implement) are unwilling to set goals, lack planning skills and are unwilling to accept change. Managers identify barriers to achievement of goals. It helps in identifying areas in which existing objectives can be continued, modified or abandoned and the areas in which new objectives can be framed together with plans to achieve them,

5. Development of planning premises:

Planning process is bases upon estimated of future as plans are made to achieve goals in future.

The estimates about future markets, consumer preferences, political and economic environment are the planning premises on which business plans are developed. The process of planning is based upon estimates of future events. Though past provides guide for making plans in present, plans are made to achieve goals in future. The forecast or assumptions about future which provide base for planning in present are known as planning premised.

6. Development of alternative courses of action:

After managers are clear of goals to be attained, they think of ways to achieve them. They should make alternative plans of action since there can be no  best way of doing  things. All possible alternatives to achieve the objectives should be considered by managers.

7. Evaluation of different courses of action:

When the alternative courses of action are developed, managers select the most appropriate plan that will adjust to the internal and external environmental conditions and can be achieved with the available resources. Each course of action has costs and benefits. Managers should carry out a cost-benefit analysis (comparison between costs and revenues) and the plan which gives maximum return should be accepted by them.

8. Selection of a course of action:

 When the best course of action is determined, it should be finally selected by managers. Each plan should be supported by sub-plans known as derivative plans.

9. Feedback:

Feedback means response. When plans are selected and implemented, managers receive information about the success or failure of plans. If there are decimations in actual performance against planned performance, managers remove these decimations or make fresh plans. Plans must be continuously revised as the environment in which they operate is a set of changing, dynamic factors.

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