OCM 3 Marks Each

Single Use plan:

• As the name suggests, single use plans are made for handling one-time, non-recurring problems. Single-use plans are also referred to as ‘specific plans’ since these are meant to solve a particular problem.
• These plans are formulated to handle non-repetitive and unique problem. These plans cannot be used again and again. These plans become obsolete after achieving their purpose.
• The examples of these plans could be constructing a dam, making budget, organizing an event, etc.

Contingency plan:

• A plan designed to take account of a possible future event or circumstance is called a contingency plan.
• Business unit face changing market situations. These changes could be change in political, economical, social or natural factors.
• If the business has to make changes in the original plan or make a new plan due to such reasons then the plan made is called contingency plan.

• An operational plan is a detailed plan which provides a clear picture of how a team, department or an individual will contribute for achieving strategic goals of the organization.
• Operational plan is almost similar to tactical plan.
• Generally, operational plans are formed for short duration say about one year.
• Under this, plans related to monthly or quarterly production, sales, etc. are made for achieving of objectives of annual production.
• These plans are made by departmental heads for the implementation of strategic plan.
• These plans are mainly formed for performing routine work and achieving daily targets. Hence, implementation of operational plans becomes easy, if they are made by involving concerned employees in the decisions, as these plans are related with routine work.

Contingency plan:

• A plan designed to take account of a possible future event or circumstance is called a contingency plan.
• Business unit face changing market situations. These changes could be change in political, economical, social or natural factors.
• If the business has to make changes in the original plan or make a new plan due to such reasons then the plan made is called contingency plan.

Importance of planning:

• Planning is the foundation of any business and an outline for its future. It is necessary in each and every field.
• Hence, government, private sector and all other sectors make plans for their activities.
• Considering the importance of planning, the Central Government of India has formed the planning commission which plans the various activities for India.

Following are some of the importance planning:

1. Planning helps to perform all activities systematically.
2. Wastage of resources can be avoided.
3. Planning reduces future uncertainties.
4. Planning leads to precision.
5. It is useful for accomplishing objectives.
6. Planning also brings smoothness in other managerial functions.
7. Planning increases co-operation among employees.
8. It enables effective control over the activities and unit.
9. Planning co-ordinates various activities.

Components or Elements of Planning:

• Objectives :

• The main purpose of every business unit is determine and fulfill objectives.
• While determining objectives, all the factors affecting business are to be considered.
• Objectives must be practical. It should not be over ambitious.

• Strategy :

• Tactics used for the implement of pre-decided objectives of planning is known as strategy.
• Strategy is used in the field like military and sports.
• Strategy should be kept confidential from the competitors then only these strategy give guarantee of success to a business unit.

• Policy :

• Decisions and strategies are decided by the management for fulfillment of objectives is known as policy.
• Proper policy given precise image of the business unit and creates good impression in the society.
• Policy gives an idea of working style and efficiency of the business unit.
• Like objective policy should be practical and real. E.g.
• Purchase sales policy on credit, policy of after sale service given to customer etc.

• Method or procedure :

• Method is an arrangement for carrying out business programmers.
• Strategy present the arrangement of facing competition, while policy gives an information to fulfill the objectives while methods refers the best way of fulfillment of pre-determined objectives.
• E.g. A business units tries to fulfill the objectives of annual sale on the basis of figures of quarterly sale.
• Selection of product for the sales to the customer, put product on counter for display, make dill on computer, packing, payment of amount, delivery of goods etc. in short, method refers to the best way of performing a task.

• Rules :

• Rules are necessary to fulfill the functions of planning.
• Rules decides the procedure and gives the clear understanding and also ensures discipline amongst the employees.
• E.g. “No smoking at work place.” Use of mobile during working hours is prohibited while packing good, hand should be washed etc.
• Rules are necessary for the fulfillment of pre-determination programme of planning.

• Budget:

• Budget is used as a tool of control for the fulfillment of business objectives.
• Different types of budget like sales budget, cash budget, production budget, capital expenditure budget are prepared.
• Budget keeps control over the business activities and make the management more efficient.

• Programme :

• Programme is a sequence of activities to be undertaken by a business unit.
• All the activities of a business unit is done as per programme.
• If the work is not done as per programme then it will be difficult to bring co-ordination between activities.
• The function of management is not only to see that the work carried out according to programme but also compare it with actual standards.
• And if any deviation is found then it is necessary to take corrective steps.

• The task of collecting information for the activities to be undertaken in business, consider them in advance and plan out how to do these activities is called planning.
• Planning is done using mental abilities while remaining conscious about the outcomes.
• Managers develop plans precisely and minutely by undergoing rigorous brain storming, collecting and analyzing statistical data, collecting relevant information, etc.
• During the planning, the role, responsibilities and authorities of each person and department is also carefully drawn.
• As a result, when the business operations start following the plans, all the departments and employees very well know what has to be done, how it has to be done and in which time frame.
• There arises no confusion related to who is responsible for what and who should report to whom.
• Hence, planning makes the daily operations very smooth, easy and achievable.

Contingency plan:

• A plan designed to take account of a possible future event or circumstance is called a contingency plan.
• Business unit face changing market situations. These changes could be change in political, economical, social or natural factors.
• If the business has to make changes in the original plan or make a new plan due to such reasons then the plan made is called contingency plan.

Single Use plan:

• As the name suggests, single use plans are made for handling one-time, non-recurring problems. Single-use plans are also referred to as ‘specific plans’ since these are meant to solve a particular problem.
• These plans are formulated to handle non-repetitive and unique problem. These plans cannot be used again and again. These plans become obsolete after achieving their purpose.
• Examples of these plans could be constructing a dam, making budget, organizing an event, etc.

Operational plan:

• An operational plan is a detailed plan which provides a clear picture of how a team, department or an individual will contribute for achieving strategic goals of the organization. Operational plan is almost similar to tactical plan.
• Generally, operational plans are formed for short duration say about one year.
• Under.this, plans related to monthly or quarterly production, sales, etc. are made for achieving of objectives of annual production.
• These plans are made by departmental heads for the implementation of strategic plan.
• These plans are mainly formed for performing routine work and achieving daily targets. Hence, implementation of operational plans becomes easy, if they are made by involving concerned employees in the decisions, as these plans are related with routine work.

Strategic plan:

• Strategic planning is an organization’s process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy.
• Based on their philosophies the business units decide several business objectives.
• The unit then develops short term as well as long term strategies for achieving the desired objectives. This is called strategic planning.
• Foresightedness and experience are essential for developing strategic plans.
• The effects of strategic plans are seen in the long. These plans shape the future of the business.
• These plans demand that the unit takes consistent decisions that are in line with the strategy formed.

Standing plan:

• When there is repetition of some specific activities in an organization then the organization forms a plan to take care of that activity. Such a plan is called standing plan. These activities could be delivering goods to a customer in case he has crossed his credit limit, developing plan or policy to decide the quantity of a specific good to be produced during the end of sale season, etc.
• Standing plans provide guidelines for taking decisions in repetitive situation hence standing plan can be used repeatedly.
• Standing plans help the subordinates to take prompt decision.
• If the standing plan is framed then employees need not take permission from their superiors for executing the plans in case if situation arise.

The planning process consists of following steps:

1. Determination of objectives
2. Clarifying planning premises
3. Collection and analysis of information
4. Preparation of alternative plan
5. Evaluation of alternatives
6. Selection of the best alternative
7. Formulation and evaluation of subsidiary plan
8. Evaluation of plan

The basic objective of a business unit is to increase the profitability by using optimally the resources of the unit. For this, while preparing plans, the working capacity of resources, when, to what extent , for which product, how they are to be used is considered. Hence, the optimum use of resources becomes possible. Moreover, while evaluating the resources, the limitation thereof can also be known. Managers can take steps to increase the productivity by removing these limitations. By this way also the planning makes possible, the optimum use of resources. Thus, planning key to success of business.

The activities determined by planning are to be done in specific ways and by specific methods. Hence, the employees do not get any chance to use their own-description an efficient employees cannot make any changes in the plan, even in he finds something odd in it, he has no right to correct the plan. Thus, planning is an attack on freedom of employees.

Planning is an objectives-oriented activity, manager have to achieve the decided objective in fixed time by decided methods and procedures. If the objectives are targets are over ambitions employees cannot achieved them and they feel fatigue and due to this depression arises amongst employees. So, employees may oppose against management. So, the objective of planning should not be over ambitious.

The objectives to be achieved that is, the result to be obtained in future are kept in view while planning the activities. In production planning in which month, which product and how much production is to be made etc. issues are determined. In the same way, in sales planning when, in which area, which product, how much sales is to be made etc, issues are decided/planned. While estimating these result, the assumptions about internal and external factors affecting it are made. In short, in any planning the pre-thinking of future results is involved.

As per the opining of experts “The task of planning is choosing” can be understood in two ways.

• Being an objective oriented activity, in planning first of all the objectives behind the activities have to be made clear.
• Objectives may be numerous.
• E.g. Quality improvement, reduction in wastage, control over costs, research work etc. out of various objectives, the main objectives behind ant activity is to be selected which is an important function.
• When there are more than one ways to perform activities, then out of alternative ways, right way has to be selected. In this sense also planning is a choosing work.
• For example, there are techniques of roller printing, screen printing, screen printing, basic printing for printing design on clothes.
• Only after choosing any one right method amongst these, the planning function can move ahead.

In planning objectives, policies methods, rules, programmers etc. should be taken into consideration. Due to this every employees has to achieve his targets in time as per predicated working method. By doing this, maximum use of production resources becomes possible. So wastage and unproductive expenses are reduced and economy is achieved.

Planning is always done for future activity. So at the time of planning assumption are made regarding effects of internal and external factors. And keeping that thing into mind, which activity, by whom, when, in which preparation will done will be decided. Thus, in present planning is done for therefore activity so it has relation with future activity.

Planning is done for future activities. Future is uncertain. Estimates or assumptions done for internal or external factors affecting business are not completely right. If any changers occurred in that factors then in each circumstances planning cannot be changed in every situation. So at that time planning become unnecessary.

Objective Oriented Activity :

• Planning is made to achieve pre-determined objective of the business.
• Management decides future targets pre objectives of business.
• Fulfillments of objectives become easy if the targets are practical.
• Thus, planning is an objective oriented activity.

All the time of assumptions of planning:

• Past experience
• Present situation
• Interrelationship between factors
• Availability of resources,
• Trends of competitors,
• Apery of other countries,
• Economic matter etc. factors are studied cleverly.
• Due to this estimates can be made regarding which factors will be found on which side in future.
• On the basis of assumptions, production.
• Scarce situation can be faced.
• Uncertain situation can be faced.
• Thus, due to planning management can face the uncertainty of situation, so this situation would be decrease.

Single Use Plan :

• Single Use Plans are prepared for those functional activities which do not reccur.
• E.g. for the activities like construction of stadium, construction of bridge, ship making, packaging, printing etc.
• This plan is more important. In short, for the achievement of special objectives and specific activities, Single Use Plan is prepared.

• Contingency Plan :

• Business unit has to integrate with changing situations.
• Business environment is also keep on changing due to political, economical, social or natural factors.
• Due to these reasons if changes are to be made in original plan is made it is known as contingency plan.

Planning involves forecasts of various factors affecting activities. While forecasting conditions of raw-materials, competition, fashion, market trends, government policy, electricity, fuel, transportation etc. are considered. Thereafter, estimates about them are made. These estimates can never be 100% (cent percent) true because no factor is stable and any change in one factor affects other factors also. If planning is not changed in accordance with the change in the circumstances, it fails. Hence, it is said that flexibility is pre-condition of successful planning.

First of all in context of object, information should be collected for planning of different activities from different sources. It should be analysis. For achieving object in time and in less expense, alternative plan should be considered. For all these functions, experts have to be engaged. Beside this, different types of statements are to be prepared and for statement stationery are to be used. From this point of view planning becomes expensive. Activity of collecting information – required for planning is also expensive.

Planning is an intellectual process based on estimates. The future estimate related to different factors affecting business competition, demand and supply, technology, fashion of customer, taste, situation of financial market, raw-material situation, manpower, government policy are taken into consideration. These factors are not certain. Due to changes made in these, premises may be failure. So from this point of view, base of planning is uncertain.