PLANNING

I. NATURE AND CHARACTERISTICS OF PLANNING

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Primacy of Planning
Planning of Process
Pervasiveness of Planning
Future Orientation
Information Base
Rationality
Formal and Informal Nature
Intellectual process
Pragmatic
Dynamism
Involves Choice

II. PLANNING DEFINED

Planning
- the management functions that involves anticipating future trends and determining the best strategies
and tactics to achieve organizational objectives.
- the selection and sequential ordering of tasks required to achieve an organizational goal.
- deciding what will be done, who will do it, where when and how it will be done, and the standards to
which it will be done.
- For engineering purpose, it is defined as selecting the best course of action so that the desired result
may be achieved. The desired result takes priority and the course of action chosen is the means to
realize the goal.
Plan output of planning, provides a methodical way of achieving desired results.
III. PLANNING AT VARIOUS MANAGEMENT LEVELS
The levels of management can be classified in three broad categories
1. Top Management Level - Strategic Planning
Chief executive officer (CEO)
President
Vice President
General Managers
Division Heads
2. Middle Management Level - Intermediate Planning
Functional Managers
Product Line Managers
Department Heads
3. Lower Management Level - Operational Planning
Unit Managers
First Line Supervisors

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IV. TYPES OF PLANNING
1. Strategic planning
The term strategic planning refers to the process of determining the major goals of the
organization and the policies and strategies for obtaining and using resources to achieve
these goals. The top management of any firm is involved in this type of planning.
In strategic planning, the whole company is considered, specifically its objective and
current resources.
The output of strategic planning is the strategic plan which spells out the decision about
long-range goals and the course of action to achieve goals.
Responsible for strategic planning:
president / general manager
2. Intermediate Planning
Intermediate planning refers to the process of determining the contributions that subunits
can make with allocated resources. This type of planning is undertaken by middle
management.
Under intermediate planning the goals of a subunit are determined and a plan is prepared
to provide a guide to the realization of the goals. The intermediate plan is designed to
support the strategic plan.
Responsible for strategic planning:
marketing manager
production manager
finance manager
personnel manager
3. Operational Planning
- Operational planning is the process of planning strategic goals and objectives to tactical
goals and objectives. It describes milestones, conditions for success and explains how, or
what portion of, a strategic plan will be put into operation during a given operational
period, in the case of commercial application, a fiscal year or another given budgetary
term. An operational plan is the basis for, and justification of an annual operating budget
request. Therefore, a five-year strategic plan would typically require five operational
plans funded by five operating budgets.
- Responsible for strategic planning:
industrial engineering manager
factory manager
quality control manager

V. THE PLANNING PROCESS

1. Setting organizational, divisional, or unit goals
Goals - precise statement of results sought, quantified in the time and magnitude, where
possible.
2. Developing strategies or tactics to reach goals
Strategy - a course of action aimed at ensuring that the organization will achieve its
objectives.
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Tactic - a short-term action taken by management to adjust to negative internal or
external influences.
3. Determining resources needed
4. Setting standards
Standard - quantitative or qualitative measuring device designed to help monitor the
performances of people, capital goods, or processes
VI. TYPES OF PLANS
A. Functional Area Plan
Types of functional area plans
1. Marketing plan
- This is the written document or blueprint for implementing and controlling an organizations
marketing activities related to a particular marketing strategy.
2. Production plan
- This is a written document that states the quantity of output must produce in broad terms and
by product family.
3. Financial plan
- It is a document that summarizes the current financial situation of the firm, analyzes financial
needs, and recommends a direction for financial activities.
4. Human resources plan
- It is a document that indicates the human resource needs of a company detailed in terms of
quantity and quality and based on the requirements of the companys strategic plan.
B. Plans with Time Horizon
Plans with time horizon consist of the following:
1. Short-range plan
These are plans intended to cover a period of less than one year. First line supervisors are mostly
concerned with these plans.
a. Action plan serves to operationalize any other kind of plan.
b. Reaction plans are plans designed to allow the company to react to an unforeseen
circumstance. The circumstance may or may not be a pleasant one for the organization,
and the reaction itself may or may not result in favorable consequences
2. Long-range plan
These are plans covering a time span more than one year. These are mostly undertaken by middle
and top management.
C. Plans with Varied Frequency of Use
According to frequency of use, plans may be classified as:
1. Standing plans
These are plans that are used again and again, and they focus on managerial situations that recur
repeatedly
Standing plans may be further classified as follows:
a) Policies they are broad guidelines to aid managers at every level in making decisions
about recurring situations or function
b) Procedures they are plans that describe the exact series of actions to be taken in a
given situation.
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c) Rules they are statements that either require or forbid a certain action.
2. Single-Use Plans
These plans are specifically developed to implement courses of action that are relatively unique
and are unlikely to be repeated
Single-use plans may be further classified as follows:
a) Budget a plan which sets forth the project expenditure for a certain activity and
explains where the required funds will come from
b) Program a single-use plan designed to coordinate a large set of activities.
c) Projects a single-use plan that is usually more limited in scope than a program and is
sometimes prepared to support a program.

VII. MAKING PLANNING EFFECTIVE

Planning may be made successful if the following are observed:
1. recognize the planning barriers
2. use of aids to planning
Planning Barriers
1. Manager's inability to plan
2. Improper planning process
3. Lock of commitment to the planning process
4. Improper information
5. Focusing on the present at the expense of the future
6. Too much reliance on the planning department
7. Concentrating on only the controllable variables
Aids of Planning
1. Gather as much information as possible
2. Develop multiple sources of information
3. Involve others in planning process
6 Steps for Effective Planning
1. Create climate for planning.
2. Support from the top management.
3. Equal Participation.
4. Proper communication
5. Integration.
6. Strict monitoring.

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