Planning is the process of setting objectives and targets for a given time period and formulating an action plan to achieve them effectively and efficiently. Features of planning are that it focuses on achievement of objectives, primary function of management, pervasive, continuous process, futuristic, involves decision-making, involves a mental exercise. Planning is important as it provides direction, reduces the risks of uncertainty, reduces overlapping and wasteful activities, promotes innovative ideas, facilitates decision making, establishes standards for controlling. Limitations of planning are it creates rigidity, ineffective in dynamic environment, reduces creativity, involves huge costs, time consuming process, does not guarantee success.
The process of planning involves setting objectives, developing premises, identifying alternative course of action, evaluating alternative course of action, selecting alternative, implementing plan and follow up action. Plans can be standing plan that is recurring in nature or single use plan that can be used only once. Types of plans are objectives , strategy, policy, procedure, etc. Objectives are desired ends that the management of an organisation would like to achieve. A strategy provides broad contours of an organisation’s business. Policies are general statements that guide thinking or channelise energies towards a particular direction. Procedures are routine steps on how to carry out activities. Methods provide the prescribed ways or manner in which a task has to be performed considering the objective. Rules are specific statements that convey what is to be done. Programmes are detailed statements about a project which outlines the objectives, policies, procedures, rules, tasks, human and physical resources required and the budget to implement any course of action. A budget is a statement of expected results expressed in numerical terms. It is a plan which quantifies future facts and figures.