Planning

&
Forecasting
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“An objective
without a plan is
a dream”
  Douglas McGregor
 “Written account of
•  Business Dictionary definition:

intended future course of action aimed

at achieving specific goals or objectives
within a specific timeframe. It explains
in detail what needs to be done, when,
how, and by whom, and often includes
best case, expected case, and worst
case scenarios.”
Planning for……
•To Attack Enemy Post
•Workforce Development Planning
•Product Planning
•Expansion Plans
•Financial Planning
•………………….
•………………..
 Importance of Planning
•Planning helps an organization to chart a course
action for the achievement of its goals or objectives.
•Planning Provides Direction.
•Planning Reduces Risks of Uncertainty.
• Planning Reduces Overlapping and Wasteful
Activities.
•Planning Promotes Innovative Ideas.
•Planning Facilitates Decision Making.
•Planning Establishes Standards for Controlling
Establishing specific objectives is the second step of planning.
This involves determining goals or objectives for enterprise as a
whole and then for each subordinate tier and unit.
An awareness of opportunities in the context of strengths and
weaknesses helps one establish a reasonable goal and draw up
an action statement.  
Comprehensive planning to be effective requires that
managers in each sub-system of their organization;
involved in the planning process.
• The third step in logical sequence of planning is the
establishment of the premises or assumptions or
forecasts  upon which the planning shall be based. 
• These forecasts relate to price of a product, wage
rate, materials, power, availability of personnel etc.
• Certain external factors which are beyond the
control of a manager such as price level, political
situation and technological developments cannot
be foreseen very accurately.
Collection, analysis and classification of information:
• For effective planning, all relevant data should be
collected, analyzed and classified.
• Suggestions should also be invited from the
operating personnel.
• The data so collected should be tabulated to
facilitate analysis.
• All useful data should be included to facilitate
analysis and interpretation.
•  Determine alternative courses:
• The fifth step of planning is to discover the
alternative courses of action, i.e., to develop more
than one course of action. For example, if more
funds are required these can be raised by the
different ways such as the issue of share capital,
raising loans from banks or financial institutions
or public deposits etc.
• An effort should be made to reduce the
alternatives to the minimum possible
• Evaluating alternative course of action:
• Each alternative is evaluated in terms of its expected
results and benefits.
• The strong and weak points of each alternative should be
carefully weighed.
• The usual and common factors considered at the time of
evaluation of alternatives are risk, capital shortage, long
range objectives etc.
• In order to make evaluation process effective, the
usual techniques used include statistical techniques
and operational research.
• Selecting a plan:
• The next step is to select the best alternative.
When the comparative results of different
alternatives are tabulated, the alternative which
seems to be the best is selected. The selection
should be carefully made since the
consequences of selecting a particular course of
action are far reaching.
• Formation of derivative plans:
• For achieving the objects of master plans,
subsidiary or derivative plans are framed. In
order to implement the master plan, each
departmental head prepares a plan of his
department.
• Communicating and Controlling the plans:
• The next step in planning is to communicate the plan to
every manager in the organization, so as to develop a
sense of participation in the management.
• The last step is to watch the progress of a plan and note
down its shortcomings and weaknesses.
• These shortcomings should be corrected or remedied
without any delay and all future plans should be made in
the light of these pitfalls.
• A continuous review of plans helps the management to
keep the plans up to date.