Pad101.3 Planning

Topic 3:
PLANNING 3:1
CHAPTER OUTLINE
3. PLANNING
3.1 Definition of Planning
3.2 Types of Planning and Goals
3.3 Strategic Planning
3.4 Operational Planning
3.5 Importance of Planning in Public Sector
Topic 3:
PLANNING 3:2
CHAPTER KEY TERMS
Important words students should be able to defined:
planning stated goal
plan real goal
goal standing plan
strategic planning single-use plan
tactical planning policy
operational planning program
long-term goal procedure
medium-term goal rule
short-term goal budget
Topic 3:
PLANNING 3:3
CHAPTER OBJECTIVES
Upon the completion of this chapter, students should be able to:
3.1 Define planning.
3.2 Discuss the importance of planning.
3.3 Describe the types of goals organizations might have.
3.4 Differentiate between Strategic Planning and Operational Planning.
3.5 Define vision and mission.
3.6 Differentiate between Standing Plan and Single-Use Plan.
Topic 3:
PLANNING 3:4
LESSON PLAN
3.2 Importance of Planning
3.3 Scopes/Hierarchies of Planning and Goals
3.3.1 Strategic Planning
3.3.2 Tactical Planning
3.3.3 Operational Planning
3.4 Types of Plan
3.4.1 Standing Plan
3.4.2 Single-use plan
3.5 Types of Goal
3.5.1 Stated Goal
3.5.2 Real Goal
Topic 3:
PLANNING 3:5
Definition of Planning
Topic 3:
PLANNING 3:6
WHAT IS PLANNING?
Planning is the most basic managerial function. When done properly, it

sets the direction for the organizing, leading, and controlling functions.
Planning is the process of establishing appropriate goals and

formulating suitable strategies for achieving those goals.
Planning is defining organizational goals, establishing a strategy to reach

those goals, and developing a comprehensive hierarchy of plans to
integrate and coordinate activities.
PAD101 Chapter 3: 3:7

Introduction to Management Principles in Public Sector PLANNING yayaa
WHAT IS PLANNING?
Planning is defining organizational goals, establishing a strategy

to reach those goals, and developing a comprehensive hierarchy
of plans to integrate and coordinate activities (Stoner)
Planning is the process of establishing appropriate goals and

formulating suitable strategies for achieving those goals (Stoner
& Freeman, 1995)
Planning is the most basic managerial function. When done

properly, it sets the direction for the organizing, leading, and
controlling functions.

ELEMENTS OF PLANNING:

GOALS (OBJECTIVES):
A GOAL is an idea of the future or desired result that a person or an organization
envisions, plans and commits to achieve.
Organizational goals are strategic objectives that the management establishes to
outline expected outcomes and guide employees' efforts. People endeavor to
reach goals within a finite time by setting deadlines.
PLANNING
PLANNING is a primary managerial STRATEGY:

activity that involves these elements: An organizational STRATEGY is the sum of the actions an organization intends to
take to achieve long-term goals. Together, these actions make up a company's
Defining the organization’s GOALS strategic plan.
Strategic plans take at least a year to complete, requiring involvement from all
organizational levels.
Establishing an overall STRATEGY for
achieving those goals
Developing PLANS for organizational

work activities. PLAN
PLAN is a detailed proposal for doing or achieving something.
It is a written account of intended future course of action (scheme) aimed at
achieving specific goal(s) or objective(s) within a specific timeframe.


STRATEGY PLAN
• A strategy is bigger than a plan. Strategy • A plan is usually a list of steps taken to
tackles the question of why? It has a large accomplish a goal.
scope and looks at the end result as well as • A plan tackles questions like how, when,
the many paths to the desired outcome. where, who, and what?
• A strategy looks at every possible influencing • A plan is a good thing to have. In fact, it is
factor, both seen and unforeseen and comes vital to the success of almost any effort.
to terms with the whole situation, not just • However developing a plan should not be
one end result. the first step in addressing a task.
Strategy speaks to the reasons “Why?”. A Plan is focus on “How?”. A plan says, “Here are
strategy says, “Here are the best steps.” the steps”.
• In a perfect world the strategy always comes before a plan and shapes the details of the plan.
• A strategy is the overarching wisdom that coordinates all of the plans in order to effectively
reach the goals.
• Having a plan is essential, but developing a strategy should always come first.
• In its planning, an organization should never try to fit a strategy around existing plans. Rather,
it has to develop the right strategy and create the appropriate plans around the strategy.
• Strategy drives the plan toward the goal. A plan alone wanders aimlessly.

Importance of Planning
Topic 3:
PLANNING 3:13
Importance/Objectives of Planning
IMPORTANCE OF PLANNING IN MANAGEMENT:
• Formal planning is associated with:

- Higher profits and returns on assets.
- Positive financial results.
• The quality of planning and implementation affects performance more than the extent of
planning.
• The external environment can reduce the impact of planning on performance, formal
planning must be used for several years before planning begins to affect performance.

IMPORTANCE OF PLANNING IN MANAGEMENT:
• Planning is the first and most important function of management. It is needed at every
level of management.
• In the absence of planning all activities of the organisation will become meaningless. The
importance of planning has increased all the more in view of the increasing size of
organisations and their complexities.
• Planning has again gained importance because of uncertain and constantly changing
business environment. In the absence of planning, it may not be impossible but certainly
difficult to guess the uncertain events of future.

OBJECTIVES OF PLANNING:

No. Importance Details
1. Planning • Under the process of planning the objectives of the organisation are defined in simple
Provides and clear words. The obvious outcome of this is that all the employees get a direction
Direction and all their efforts are focused towards a particular end. In this way, planning has an
important role in the attainment of the objectives of the organisation.
• For example, suppose a company fixes a sales target under the process of planning.
Now all the departments, e.g. production, human resource, marketing, finance, etc.,
will decide their objectives in view of the sales target.
• In this way, the attention of all the managers will get focused on the attainment of their
objectives. This will make the achievement of sales target a certainty. Thus, in the
absence of objectives an organisation gets disabled and the objectives are laid down
under planning.
2. Planning • Planning is always done for future and future is uncertain. With the help of planning
Reduces Risks possible changes in future are anticipated and various activities are planned in the best
of Uncertainty possible way. In this way, the risk of future uncertainties can be minimised.
• For example, in order to fix a sales target a survey can be undertaken to find out the
number of new companies likely to enter the market. By keeping these facts in mind
and planning the future activities, the possible difficulties can be avoided.

3. Planning • Under planning, future activities are planned in order to achieve objectives.
Reduces Consequently, the problems of when, where, what and why are almost decided. This
Overlapping puts an end to disorder and suspicion. In such a situation coordination is established
and Wasteful among different activities and departments. It puts an end to overlapping and wasteful
Activities activities.
• Consequently, wastages moves towards nil, efficiency increases and costs get to the
lowest level. For example, if it is decided that a particular amount of money will be
required in a particular month, the finance manager will arrange for it in time.
• In the absence of this information, the amount of money can be more or less than the
requirement in that particular month. Both these situations are undesirable. In case,
the money is less than the requirement, the work will not be completed and in case it is
more than the requirement, the amount will remain unused and thus cause a loss of
interest.

4. Planning • It is clear that planning selects the best alternative out of the many available. All these
Promotes alternatives do not come to the manager on their own, but they have to be discovered.
Innovative While making such an effort of discovery, many new ideas emerge and they are studied
Ideas intensively in order to determine the best out of them.
• In this way, planning imparts a real power of thinking in the managers. It leads to the
birth of innovative and creative ideas. For example, a company wants to expand its
business. This idea leads to the beginning of the planning activity in the mind of the
manager. He will think like this:
1. Should some other varieties of the existing products be manufactured?
2. Should retail sales be undertaken along with the wholesales?
3. Should some branch be opened somewhere else for the existing or old product?
4. Should some new product be launched?
• In this way, many new ideas will emerge one after the other. By doing so, he will
become habituated to them. He will always be thinking about doing something new
and creative. Thus, it is a happy situation for a company which is born through the
medium of planning.

5. Planning • Decision making means the process of taking decisions. Under it, a variety of
Facilitates alternatives are discovered and the best alternative is chosen. The planning sets the
Decision target for decision making. It also lays down the criteria for evaluating courses of action.
Making In this way, planning facilitates decision making.
6. Planning • By determining the objectives of the organisation through planning all the people
Establishes working in the organisation and all the departments are informed about ‘when’, ‘what’
Standards for and ‘how’ to do things.
Controlling • Standards are laid down about their work, time and cost, etc. Under controlling, at the
time of completing the work, the actual work done is compared with the standard work
and deviations are found out and if the work has not been done as desired the person
concerned are held responsible.
• For example, a labourer is to do 10 units of work in a day (it is a matter of planning), but
actually he completes 8 units. Thus there is a negative deviation of 2 units. For this, he
is held responsible. (Measurement of actual work, knowledge of deviation and holding
the labourer responsible falls under controlling.) Thus, in the absence of planning
controlling is not possible.

Advantages (Benefits) Disadvantages (Criticisms)

• Managers and employees put forth greater • Planning may create rigidity.
effort when following a plan • Plans cannot be developed for dynamic
• Planning leads to persistence environments.
• Planning set clear direction of efforts • Formal plans cannot replace intuition and
• Planning encourages the development of task creativity.
strategies • Planning focuses managers’ attention on
• Good planning has been proven to work for today’s competition not tomorrow’s survival.
both organizations and individuals • Formal planning reinforces today’s success,
which may lead to tomorrow’s failure.

Scopes of Planning
Topic 3:
PLANNING 3:22
Types of Planning/Plans
TYPES OF PLANNING:
TYPES OF PLANNING/PLANS
Based on Scopes Based on Frequency of Use
Scale
(Breadth) Single-Use Plan
Hierarchy
(Levels of Management)
Standing Plan
Range
(Time-Frame)

TYPES OF PLANNING and THE DIMENSIONS:
Types of
Management Time Frame Frequency of Use
Planning Scope Specificity
Level (Range) (Repetitiveness)
(Breadth)
Strategic Upper & Broad: Long Term: Directional: Single Use Plan:
Planning Middle Apply to the entire Cover extended Flexible plans that A one-time plan
(Macro) organization that periods of time. set out general specifically
establish the Plans with time guidelines, provide designed to meet
organization’s frames extending focus, yet allow the need of a
overall goals. beyond three years. discretion in unique situation.
Seek to position implementation.
the organization in
terms of its
environment.
Operational Middle & Narrow: Short Term: Specific: Standing Plan:
Planning Lower Specify the details Cover short time Plans that are clearly Ongoing plans
(Micro) of how the overall period. defined and leave no that provide
goals are to be Plans with time room for guidance for
achieved. frames on one year interpretation. activities
or less. performed
repeatedly.

SCOPES OF PLANNING
Scope (Latitude) Scale (Breadth) Management Level Range (Time Frame)
Broad (Macro) Strategic Planning Upper Level Long Term
Intermediate Tactical Planning Middle Level Intermediate Term
Narrow (Micro) Operational Planning Lower Level Short Term

SCALE (BREADTH) OF PLANNING
PAD101 Chapter 3:
Introduction to Management Principles in Public Sector PLANNING 3:26
HIERARCHIES OR LEVELS OF MANAGEMENT

RANGE (TIME-FRAME) OF PLANNING

SCOPE OF PLANNING: A COMPARISON

SCOPES OF ORGANIZING

LECTURE OUTLINE
3.2 Objectives of Planning
3.3 Types of Planning/Plans
3.3.1 Based on Scopes
3.3.1.1 Strategic Planning
3.3.1.2 Tactical Planning
3.3.1.3 Operational Planning
3.3.2 Based on Frequency of Use
3.3.2.1 Single-Use Plan
3.3.2.2 Standing Plan
3.4 SCOPES OF PLANNING

3.5 Frequencies of Planning

3.5.1 Single-Use Plan
3.5.2 Standing Plan

Scopes of Planning
STRATEGIC PLANNING

Scopes of Planning
STRATEGIC PLANNING: Definitions
STRATEGIC PLANNING
CONCEPT OF STRATEGIC PLANNING
DEFINITION OF
STRATEGIC PLANNING Strategic plan includes evaluation and development
of the:
Strategic planning is a process by organization’s purpose;
which an organization makes Mission; and
overall objectives and policies
decision and takes actions to for current and future years.
enhance its long term It also defines:
performance. what activities the organization is in, or wants to be
in. It may take 5 to 10 years to complete.

Scopes of Planning
STRATEGIC PLANNING: Elements
• A strategic plan is a high-level overview of the entire organization, its vision, objectives,
and value.
• This plan is the foundational basis of the organization and will dictate decisions in the
long-term. The scope of the plan can be two, three, five, or even ten years.
• Managers at every level will turn to the strategic plan to guide their decisions. It will also
influence the culture within an organization and how it interacts with customers and the
media.
• Thus, the strategic plan must be forward looking, robust but flexible, with a keen focus on
accommodating future growth.
• The crucial components of a strategic plan are:

1. Vision
2. Mission
3. Core Values

Scopes of Planning
STRATEGIC PLANNING: Elements

Scopes of Planning
STRATEGIC PLANNING: Element - VISION STATEMENT
VISION STATEMENT
•Vision Statement is a long term image which the organization want to become. It is a mental picture that
organizations have and want to turn into a reality in the future. It provides answers to the questions “What the
organization wants to become?” or “Where does the organization want to be in the future?”.
MISSION STATEMENT
•Mission Statement is a broad declaration of the principal purpose. Mission Statements are normally short and
simple statements which describe the organization purpose. The mission statement is a more realistic overview
of the organization’s aim and ambitions. It is the answer to the question “Why do we exist?” or “What does an
organization aims to achieve through its existence?
CORE VALUE
•Each organization has its own values. These values will guide managers and influence the kind of employees they
hire.
SWOT ANALYSIS
•SWOT analysis (or SWOT matrix) is a strategic planning technique used to help a person or organization identify
the Strengths, Weaknesses, Opportunities, and Threats related to its competitiveness or project planning. It is
intended to specify the objectives of the organizational venture or project and identify the internal and external
factors that are favorable and unfavorable to achieving those objectives.

Scopes of Planning
STRATEGIC PLANNING: Element - SWOT ANALYSIS
• Strengths and Weakness are frequently internally-related, while Opportunities and

Threats commonly focus on environmental placement.
§ Strengths: characteristics of the organization or project that give it an advantage over others
§ Weaknesses: characteristics of the organization that place the business or project at a
disadvantage relative to others
§ Opportunities: elements in the environment that the organization or project could exploit to its
advantage
§ Threats: elements in the environment that could cause trouble for the organization or project

Scopes of Planning

Scopes of Planning

Scopes of Planning
ELEMENTS OF STRATEGIC PLANNING: SWOT ANALYSIS

Scopes of Planning
STRATEGIC PLANNING: Elements - LONG-TERM GOALS, OBJECTIVES & ACTION PLANS

Scopes of Planning
TACTICAL PLANNING

Scopes of Planning
TACTICAL PLANNING: Definitions
• The tactical plan describes the tactics the organization plans to use to achieve the
ambitions outlined in the strategic plan.
• It is a short range (i.e. with a scope of less than one year), low-level document that breaks
down the broader mission statements into smaller, actionable chunks. If the strategic plan
is a response to “What?”, the tactical plan responds to “How?”.
• Creating tactical plans is usually handled by mid-level managers.
• The tactical plan is a very flexible document; it can hold anything and everything required
to achieve the organization’s goals.
• There are some components shared by most tactical plans:

1. Specific Goals with Fixed Deadlines
2. Budgets
3. Resources
4. Marketing, Funding, etc.

Scopes of Planning
TACTICAL PLANNING: Elements
1. Specific Goals with Fixed Deadlines

Suppose your organization’s aim is to become the largest shoe retailer in the city. The tactical plan will break down
this broad ambition into smaller, actionable goals. The goal(s) should be highly specific and have fixed deadlines to
spur action – expand to two stores within three months, grow at 25% per quarter, or increase revenues to $1mn
within six months, and so on.
2. Budgets
The tactical plan should list budgetary requirements to achieve the aims specified in the strategic plan. This
should include the budget for hiring personnel, marketing, sourcing, manufacturing, and running the day-to-
day operations of the company. Listing the revenue outflow/inflow is also a recommended practice.
3. Resources
The tactical plan should list all the resources you can muster to achieve the organization’s aims. This should
include human resources, IP, cash resources, etc. Again, being highly specific is encouraged.
4. Marketing, Funding, etc.

Finally, the tactical plan should list the organization’s immediate marketing, sourcing, funding, manufacturing,
retailing, and PR strategy. Their scope should be aligned with the goals outlined above.

Scopes of Planning
OPERATIONAL PLANNING

Scopes of Planning
OPERATIONAL PLANNING: Definitions
• Operational planning is a process of determining the day-to-day activities that are

necessary to achieve the long term goals of the organization. It describes the daily
running of an organization.
• The operational plan charts out a roadmap to achieve the tactical goals within a realistic
timeframe. This plan is highly specific with an emphasis on short-term objectives.
“Increase sales to 150 units/day”, or “hire 50 new employees” are both examples of
operational plan objectives.
• Creating the operational plan is the responsibility of low-level managers and supervisors.

Scopes of Planning
OPERATIONAL PLANNING: Definitions
• Ongoing plans are created on an ad-hoc basis but can be repeated and changed as
required.
• Operational plans align the company’s strategic plan with the actual day to day running of
the company. This is where the macro meets the micro.
• Running a successful company requires paying an equal attention to now just the broad
objectives, but also how the objectives are being met on an everyday basis, hence the
need for such intricate planning.

LECTURE OUTLINE
3.2 Objectives of Planning
3.3 Types of Planning/Plans
3.3.1 Based on Scopes
3.3.1.1 Strategic Planning
3.3.1.2 Tactical Planning
3.3.1.3 Operational Planning
3.3.2 Based on Frequency of Use
3.3.2.1 Single-Use Plan
3.3.2.2 Standing Plans
3.4 Scopes of Planning

3.5 Frequencies of Planning (Types of Plan)

3.5.1 Single-Use Plan
3.5.2 Standing Plan

Types of Plan
Topic 3:
PLANNING 3:49
Frequency of Planning (Types of Plan)
TACTICAL PLANNING: Types
• There are two main types of operational plans

1. Single-Use Plan
2. Standing Plans



Types of Goal
Topic 3:
PLANNING 3:53
TYPES OF GOALS
FINANCIAL GOALS
• Financial Goals are related to the expected internal financial performance of the
organization.
STRATEGIC GOALS
• Strategic goals are related to the performance of the firm relative to factors in its
external environment (e.g., competitors).
STATED GOALS vs REAL GOALS

• Broadly-worded official statements of the organization (intended for public
consumption) that may be irrelevant to its real goals (what actually goes on in the
organization).
PAD101 Chapter 3:
Introduction to Management Principles in Public Sector PLANNING 3:54

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Topic 3:

3.1 Definition of Planning

3.2 Types of Planning and Goals

3.3 Strategic Planning

3.4 Operational Planning

3.5 Importance of Planning in Public Sector

planning stated goal

plan real goal

goal standing plan

strategic planning single-use plan

tactical planning policy

operational planning program

long-term goal procedure

medium-term goal rule

short-term goal budget

Upon the completion of this chapter, students should be able to:

3.1 Define planning.

3.2 Discuss the importance of planning.

3.3 Describe the types of goals organizations might have.

3.4 Differentiate between Strategic Planning and Operational Planning.

3.5 Define vision and mission.

3.6 Differentiate between Standing Plan and Single-Use Plan.

3.2 Importance of Planning

3.3 Scopes/Hierarchies of Planning and Goals

3.3.1 Strategic Planning

3.3.2 Tactical Planning

3.3.3 Operational Planning

3.4 Types of Plan

3.4.1 Standing Plan

3.4.2 Single-use plan

3.5 Types of Goal

3.5.1 Stated Goal

3.5.2 Real Goal

Planning is the most basic managerial function. When done properly, it

Planning is the process of establishing appropriate goals and

Planning is defining organizational goals, establishing a strategy to reach

PAD101 Chapter 3: 3:7

Planning is defining organizational goals, establishing a strategy

Planning is the process of establishing appropriate goals and

Planning is the most basic managerial function. When done

PAD101 Chapter 3: 3:8

PAD101 Chapter 3: 3:9

PLANNING is a primary managerial STRATEGY:

Developing PLANS for organizational

PAD101 Chapter 3: 3:10

PAD101 Chapter 3: 3:11

PAD101 Chapter 3: 3:12

• Formal planning is associated with:

PAD101 Chapter 3: 3:14

PAD101 Chapter 3: 3:15

PAD101 Chapter 3: 3:16

PAD101 Chapter 3: 3:17

PAD101 Chapter 3: 3:18

PAD101 Chapter 3: 3:19

PAD101 Chapter 3: 3:20

Advantages (Benefits) Disadvantages (Criticisms)

PAD101 Chapter 3: 3:21

Based on Scopes Based on Frequency of Use

PAD101 Chapter 3: 3:23

PAD101 Chapter 3: 3:24

Scope (Latitude) Scale (Breadth) Management Level Range (Time Frame)

Broad (Macro) Strategic Planning Upper Level Long Term

Intermediate Tactical Planning Middle Level Intermediate Term