INDEX:
Sr. No. 1. 2. 3. 4. 5. 6. 7.
Topics Introduction & Definition Planning Process Steps of Planning Strategic Planning Corporate Planning Advantages of Planning Limitations of Planning
Page No.s 03 05 08 13 16 19 22
1
Planning Process:
The planning process involves the following steps:
Analysis of Internal Environment:
• The planner needs to analyze the internal environment prevailing in the organization. The internal environment consists of manpower, machines, materials, organization, structure, etc. Such analysis would reveal the strengths and weakness of the organization.
Analysis of Exteranal Environment:
• A thorough analysis of external environment must be undertaken. Relevant data must be collected. For instance, the planner has to collect data about consumer preferences, government policies, competitive conditions, etc. Such analysis would reveal opportunities to be grabbed and threats to be faced by the organization.
Setting of Objectives:
• Once the environmental factors are analyzed, the next step is to set objectives. Objectives are set in all the key areas of operations, i.e., production, marketing, finance, personnel, and so on. Objectives should be SMART- Specific, measurable, Achievable, Realistic and Time bound. • For instance, the objectives of the production department can be-“To produce 10,000units of Product ‘X’ during the year 2007”.
2
Framing Alternative Plans:
• After setting objectives, the next step is to determine the alternative plans. It is to be remembered that it is always advisable to prepare alternative plans rather than preparing a single plan. • For instance, to increase the market share, the planner can make alternative plans such as: • Plan 1 –› Increase in advertising. • Plan 2 –› Improvement in quality. • Plan 3 –› Increase in incentives to dealers, etc.
Studying Alternative Plans:
• Once alternative plans are determined, they are to be evaluated in terms of costs, benefits, risks, etc. There must be cost-benefit analysis of every alternative plan. This is because; some plan may be more costly to implement. But more beneficial to organization. Some other land may be less expensive, but may not yield to the organization. Therefore, one should study the pros and cons of the alternative plans.
Selecting of the Best Plans:
• Once, the plans are analyzed or evaluated, the next step is to select the best feasible plan from the alternatives. The alternative plan which gives maximum benefit at minimum cost is selected. • While selecting the best course of action, the planners must consider the environment and objectives of the organization.
Formulation of Derivative Plans:
3
• Several operating plans are required to implement the overall plan. Such operating plans are short range or sub-plan which are useful in day-to-day operations. Programmes, budgets, schedules, etc are examples of derivative plans.
Establishing the sequence of activities:
• Once, the derivative is plans are prepared; the next step is to work out the sequence and timing of activities involved in each sub-plan. The sub-plans need to be integrated so as to achieve the goals as per the plan. The manager will then get a clear picture of final plan.
Review:
• Plans are periodically monitored to find out whether the performance is taking place as per the planned targets. If necessary, plans are revised in the light of changing environment and objectives of the organization.
Implementation:
• The various plans of the organizations are communicated to those whose participation is required to implement them. Implementation involves: 1. Organizing resources. 2. Directing Sub-ordinates. For effective implementation of the plan, it is essential that the employees clearly understand- ‘what is to be done, how it is to be done, when it is to be done and who needs to do it’.
4
Steps of Planning: How to analyze the Situation and Needs:
• The analysis step is about understanding the situation, problem or issue you wish to impact on better. It is also about understanding the needs of your target community in the context of that situation, problem or issue. • This analysis is important and should inform all the decisions you make in the rest of the planning process. It will help you in later steps to choose the most relevant and realistic goal, work out the most effective way of achieving your goal (objectives and strategies), plan to implement your decisions and plan what you will use to assess and evaluate your progress. • The purpose of this step is to build a common understanding about: 1. The current situation and how it affects your target group; 2. The deeper causes of this situation; and 3. Future situation you want to contribute to creating.
How to prioritize and Select the Goal and Purpose:
• In this step you will use your analysis of the situation and needs to make decisions about what the broad aim will be; what change you aim to help bring about in the lives of your primary stakeholder community. • In the Logical Framework Approach, a goal is a general statement of the situation you aim to contribute to bringing about.
5
• Goals are the reason why you undertake any activity and are often fairly general and long-term. Often, the change that is needed to make a really meaningful improvement in the situation of your target community and in their lives is complex and would require many different efforts to achieve. • It is still important for you to state this goal. The goal helps keep you focused on the important long-term change that is required, even though it is usually not possible for your organization alone to bring about the change. It helps you work out what contribution you can and will make to bringing about that longer-term change. It also helps you identify the other organizations working toward that goal so that you can co-operate with them. It is your goal that explains the meaning of what you hope to achieve. Your analysis of needs will assist you to identify what change will make a significant difference to the situation, issues or problems identified. • In the Logical Framework Approach, a purpose is the result your organization commits itself to achieving in order to make a contribution to the achievement of the longer-term goal. This should be something that your organization can realistically achieve by itself. The purpose describes why your organization, programme or project exists.
How to plan for evaluation:
• The systematic Logical Framework Approach outlined above includes planning for evaluation. It lays a systematic basis for transparency and accountability through providing a clear record of agreements. It allows for the inclusion of all those with a stake in the success of your work. It also lays a good basis for
6
agreement about what was achieved effectively, what was not and why it was or was not achieved effectively:
•
Your analysis of the situation and needs of your target community should have provided you with useful baseline information that tells you what the situation was when you started. If you are going to know how far you have come, you need to know where you started. The first three levels of objectives (goal, purpose and specific objectives) should have recorded agreement on the results you expect to achieve, or, in the case of the goal, that you expect to contribute to achieving. You will be able to use these to see if you have achieved these results. A key step in planning for evaluation is to clarify and finalize the criteria or indicators you will use to evaluate successful achievement of each objective at each level. The final step is to agree what information you will need to be able to evaluate the achievement of your criteria or indicators, where you will get it, how and from whom.
•
•
•
Setting of Clear & Realistic goals:
• You now need to help the group use the analysis to decide on a goal and purpose that are: 1. Relevant to the key problem or issue you have identified and its causes; 2. Realistic in terms of what you are capable of doing; and 3. Appropriate in terms of the needs you have analyzed. • As a facilitator, you need to show people why it is useful to set a goal and a purpose and what the difference is between them. Use the following to explain these terms:
7
• A goal is the long-term situation you believe should be achieved in the lives of your target group. Usually this is not something your organization and actions alone can bring about, but it needs to be something you can make a significant contribution to achieving through your efforts. This goal should be worded to describe the situation you would like to see, not the actions you will take to achieve it. This helps everyone to see what long-term impact you hope to be part of bringing about to improve the lives of your target group.
•
The purpose describes the situation that you intend to bring about from your activities. It is a positive situation you are committing yourselves to brining about through your efforts. The goal helps you ensure that the purpose is relevant to the large long-term change that is needed. The purpose helps you later work out what action will be required to achieve it. It helps you test your thinking by asking whether, if you do everything you plan, it will be enough to achieve the purpose. Again, you should not describe the action you will take but the change you intend to produce in the lives of your target group.
•
Implementation plans
• In this session, the facilitator needs to help participants make decisions on what activities will be needed to achieve each objective using the strategy agreed. Implementation plans or activity plans, as they are often called, need to be specific about: 1. What must be done 2. Who must do it 3. How it will be done
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4. By when it must be done. • It is often useful to identify someone or a group that will take responsibility for each objective. This group can then be asked to draft an activity plan for achieving that objective. The following is based on this approach. 1. Give each group the sheet of flip chart paper with the objective they are responsible for and the agreed strategy written on it. Give each group at least four additional pages of flip chart paper. 2. Ask each group to write the heading "Activities" on one sheet of blank flip chart paper. The other sheets should be headed "Responsibility", "Deadline" and "Resources needed". 3. When the time is up, ask each group to present their thinking to the other groups. Allow questions for clarity first and then comments and suggestions
9
Strategic Planning:
• Strategic planning is a management tool and it is used for one purpose only: to help an organization do a better job - to focus its energy, to ensure that members of the organization are working toward the same goals, to assess and adjust the organization's direction in response to a changing environment. • In short, strategic planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization is, what it does, and why it does it, with a focus on the future. • Strategic planning helps an organization to know where its going over the next year or more, how it's going to get there and how it'll know if it got there or not. The focus of a strategic plan is usually on the entire organization, while the focus of a business plan is usually on a particular product, service or program • The process is strategic because it involves preparing the best way to respond to the circumstances of the organization's Which act as a obstacle for the organization, whether the organization is known in advance or not it must be ready to face any circumstances in future.
10
• Being strategic, then, means being clear about the organization's objectives, being aware of the organization's resources, and incorporating both into being consciously responsive to a dynamic environment • The process is about fundamental decisions and actions because choices must be made in order to answer the sequence of questions mentioned above. The plan is ultimately no more, and no less, than a set of decisions about what to do, why to do it, and how to do it. Because it is impossible to do everything that needs to be done in this world, strategic planning implies that some organizational decisions and actions are more important than others - and that much of the strategy lies in making the tough decisions about what is most important to achieving organizational success. • The strategic planning can be complex, challenging, and even messy, but it is always defined by the basic ideas outlined above - and you can always return to these basics for insight into your own strategic planning process. • Strategic planning has also been described as a tool - but it is not a substitute for the exercise of judgment by leadership. Ultimately, the leaders of any enterprise need to sit back and ask, and answer, "What are the most important issues to respond to?" and "How shall we respond?" Just as the hammer does not create the bookshelf, so the data analysis and decision-making tools of strategic planning do not make the organization work - they can only support the intuition, reasoning skills, and judgment that people bring to their organization. • Strategic planning, though described as disciplined, does not typically flow smoothly from one step to the next. It is a creative process, and the
11
fresh insight arrived at today might very well alter the decision made yesterday. • Inevitably the process moves forward and back several times before arriving at the final set of decisions. Therefore, no one should be surprised if the process feels less like a comfortable trip on a commuter train, but rather like a ride on a roller coaster. But even roller coaster cars arrive at their destination, as long as they stay on track! • Strategy planning is a combination of rational, scientific examinations and educated, intuitive best guesses. Many individuals are overwhelmed by the idea of developing strategies, but it can be a fun and invigorating process. • The process entails: 1. examining the organization's critical issues 2. determining how the organization's strengths and skills can be employed to address the critical issues 3. analyzing opportunities and strengths and looking for ways to synthesize the two 4. exploring and choosing the best approaches for the organization. 5. Strategy means a plan designed to achieve a particular longterm aim. 6. Strategic planning is forming part of a long-term plan or aim to achieve a specific purpose. 7. Strategy planning is hard work. It helps the organization to work break free and help the company to grow physically and financially .
12
Corporate Planning: Definitions of Corporate Planning on the Web:
•
Drucker defined Corporate Planning as “the continuous process of making present risk-taking decisions systematically and with the greatest knowledge of their futurity; organizing systematically the efforts needed to carry out these decisions, and measuring the results of these decisions against the expectations through organized, systematic feedback.”
• Corporate planning is a well established discipline in large organizations. It deals primarily with long-term strategic matters. • It has its own methodology and is very different from normal business planning. • A typical business plan considers horizons of typically three or five years. A corporate plan will often have a horizon twice that of the business plan. • The majority of small and medium sized enterprises does not carry out corporate planning and do not think strategically. The owners and directors of most small and medium size enterprises believe that the tactical planning that they carry out amounts to strategic planning.
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• This belief is a major contributor to the very high failure rate of small and medium size enterprises during their first three years of existence. • Concentration on day to day management and tactical planning leaves the new enterprise vulnerable to changes in market conditions, reactions of competitors, delays by key customers and delays in the overall startup project. • Failure to consider values, vision and mission can contribute significant stress during the initial periods of rapid growth or startup problems. • As additional personnel join the enterprise the culture of the organization quite often changes. If the organization's values, vision and mission have not been clearly articulated, the developing culture may lead the organization off at a tangent that the founders had never intended. • Sometimes the founding owners end up in conflict as they each try to take the enterprise in different directions. This can be particularly dangerous if the founding owners have key skills or facilities which, if they remove them, can cause the business to fail. • If the business direction of the enterprise conflicts with the values of one of the founders there are bound to be problems. • The solution is relatively straightforward but is a process followed by few start up enterprises. • The following steps should be followed:-
1. Elicit the values of each of the key people involved in the enterprise. Any conflicts at this stage must be resolved and, if the differences cannot be reconciled, a methodology of avoiding confrontation must
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be determined. If this is not possible it is dangerous to proceed further without a significant risk of failure. 2. Based on the values determine the vision of the enterprise. This needs to be meaningful and inspirational, maybe even a bit frightening. Too many vision statements are meaningless and fail to inspire resulting in alternative, informal visions really driving the enterprise. • Do not forget - your enterprise is unlikely to ever exceed your vision so - think big. • If you want to know if your vision statement means anything give a copy to any potential recruit and ask them to explain what they think it means - the response can be very interesting. 3. Once the values and vision have been articulated the next stage is the mission statement. • Why should your enterprise exist, what does it do? • Does it do anything of any real use or is it just a method of obtaining money? • If it ceased to exist would any of your customers miss it? • What strategies are you going to use in order to achieve your vision? • This represents only the initial stages of corporate planning and the use of corporate strategy. However, if you miss this stage you will not produce a coherent strategy and will not have clearly defined corporate goals.
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ADVANTAGES OF PLANNING: THE NEED AND IMPORTANCE OF PLANNING CAN BE EXPLAINED WITH THE HELP OF ITS ADVANTAGES:
MINIMIZES RISKS:• Planning helps to minimize or reduce risks. • Potential risks are forecasted and necessary protective devices are decided well in advance. • If the risks occur, then the protective devices are put into practice. • The protective devices are the contingency plans that help to reduce risks.
FACILITATES COORDINATION:• The plans of one department are coordinated with the plans of all other concerned departments. • This brings in unity among the various departments of the organization. • In other words, the concerned departments work in close harmony in the implementation of the plans.
FACILITATES ORGANISING:• Planning enables a manager to organize the resources properly.
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• If required, he may make arrangement for additional resources in order to achieve the planned targets. • Depending upon the targets, the manager will make proper arrangement of resources.
FACILITATES PROPER DIRECTION:• Planning provides proper schedules or time table or to when the activities need to be conducted. • This facilitates the manager to direct his subordinates as and when required. • Clear directions can be given to the subordinates so that they undertake the right tasks at the right time.
FACILITATES CONTROL:• A plan provides a yardstick (target) against which actual performance can be compared. • Such comparison will enable to find out the deviations from the plans. • If deviations are noticed, the manager may take the right corrective steps at the right time.
GENERATES EFFICIENCY:• Planning enables optimum utilization of resources. All the resources i.e., physical, financial and human resources are put to their best use. • The optimum utilization of resources enables a company to achieve highest possible returns at lowest possible costs.
ENCOURAGES INNOVATION:-
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• The planning process encourages creative thinking on the part of managers. They strive to come out with innovative ways to achieve the results as per the plans even during the tough times. • The innovative ideas often bring best result to the organisation.
FOCUS ON GOALS:• Planning is goal oriented in the sense that plans are developed and executed to achieve certain goals. Every activity is directed towards the attainment of goals. • Activities are conducted in a systematic and smooth manner. • There is hardly any scope for haphazard activities.
FACILITATES DECISION-MAKING:• Normally, a manager frames alternative plans. • After necessary analyses of the plans, the best plan is selected. • Thus, planning facilitates the choice of the best plan. • Accordingly, managers take decisions to organize, to direct, and to control the activities.
MOTIVATES PERSONNEL:• Professional managers frame alternative plans in consultation with the subordinates. • When there is active involvement of the subordinates in planning, then they become highly committed to the achievement f the goals. Also, plans provide a challenge for the superiors.
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Disadvantages/Limitations of Planning: Time Consuming:
• There is a need to collect and analyses dad before framing plans. The subordinates and the concerned departments may have to be consulted. There may be a need to get approval from higher authorities. All this takes a good amount of time.
Paper Work:
• Planning requires a good deal of paper work, quite often, plans are drawn and re-drawn. Necessary reports are required to be collected from subordinates to prepare the final plans. Paper work is also involved in taking approval of the plans from the top management.
Expensive:
• A good amount of money is spent on collection and analyzing data which is required to frame the plan. The company may consult
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professionals before finalizing the plan, for which consultancy fees need to be paid.
Generates Rigidity:
• Manager may tend to achieve only what has been planned. Even if the situation permits them to achieve on the higher idea, they may not put extra effort .However, manager and their subordinates can be motivation to put in their best efforts and not just to stick to planned targets.
Generates frustration:
• At times, manager may not be able to achieve the planned targets despite their best efforts. This may generate frustration and loss of initiative on the part of the manager and other. However, necessary motivation and training may be given so that the manager and others can easily overcome the frustration and stress.
Danger Of Over-Targeting:
• There are cases, where functional manager plan the target on the higher side. This is more so on the part of the over enthusiastic manager. Again, the manager may get wrong data, or there may be wrong interpretation of data and as such over-targeting.
Danger Of Under Targeting:
• There are cases, where the manager deliberately frame plan with lower targets. This is because they can easily attain such targets and receive compliments for the same. This is more so in government and
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public sector organization. There may be genuine case of under targeting due to wrong dada collection and interpretation.
Danger To Human Error:
• Plans are based on forecast. A good deal of experience and judgment is necessary to forecast and frame the plan. There are cases where even the intelligent manger fails to judge certain factors and as such the plans were unrealistic. Thus, planning’s subject to human error or poor judgment.
Problem Of Technical Staff:
• Technical or creative staff may dislike plans and they call it as mere paper work which encroaches on their creativity. This can be corrected by giving proper training to technical staff so that they develop positive attitude towards planning.
Problem Of Changing Situation:
• Changing situation and conditions may throw even the best plan out of gear. For instance, there may be an unexpected natural calamity such as food or famine. This may take the plan ineffective. However, plan may be modified to meet the changing situations.
Resistance to Changing:
• Planning may often require structural changes in the organization. However, people are often reluctant to change. Unless the required changes are made, plans may not be of any use. Therefore, it is vital to make people aware that “a change is the only thing that has brought progress in the world”.
21
Problem of Internal Conflicts:
• Plans are too framed in consultation and in coordination with the concerned departments. However, there may be disputes relating to the framing of the plans. For instance the production department may be willing to produce more units of ‘product A’, whereas; the marketing department may be instructed to sell more units of ‘Product B’.
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doc_193283117.doc
Sr. No. 1. 2. 3. 4. 5. 6. 7.
Topics Introduction & Definition Planning Process Steps of Planning Strategic Planning Corporate Planning Advantages of Planning Limitations of Planning
Page No.s 03 05 08 13 16 19 22
1
Planning Process:
The planning process involves the following steps:
Analysis of Internal Environment:
• The planner needs to analyze the internal environment prevailing in the organization. The internal environment consists of manpower, machines, materials, organization, structure, etc. Such analysis would reveal the strengths and weakness of the organization.
Analysis of Exteranal Environment:
• A thorough analysis of external environment must be undertaken. Relevant data must be collected. For instance, the planner has to collect data about consumer preferences, government policies, competitive conditions, etc. Such analysis would reveal opportunities to be grabbed and threats to be faced by the organization.
Setting of Objectives:
• Once the environmental factors are analyzed, the next step is to set objectives. Objectives are set in all the key areas of operations, i.e., production, marketing, finance, personnel, and so on. Objectives should be SMART- Specific, measurable, Achievable, Realistic and Time bound. • For instance, the objectives of the production department can be-“To produce 10,000units of Product ‘X’ during the year 2007”.
2
Framing Alternative Plans:
• After setting objectives, the next step is to determine the alternative plans. It is to be remembered that it is always advisable to prepare alternative plans rather than preparing a single plan. • For instance, to increase the market share, the planner can make alternative plans such as: • Plan 1 –› Increase in advertising. • Plan 2 –› Improvement in quality. • Plan 3 –› Increase in incentives to dealers, etc.
Studying Alternative Plans:
• Once alternative plans are determined, they are to be evaluated in terms of costs, benefits, risks, etc. There must be cost-benefit analysis of every alternative plan. This is because; some plan may be more costly to implement. But more beneficial to organization. Some other land may be less expensive, but may not yield to the organization. Therefore, one should study the pros and cons of the alternative plans.
Selecting of the Best Plans:
• Once, the plans are analyzed or evaluated, the next step is to select the best feasible plan from the alternatives. The alternative plan which gives maximum benefit at minimum cost is selected. • While selecting the best course of action, the planners must consider the environment and objectives of the organization.
Formulation of Derivative Plans:
3
• Several operating plans are required to implement the overall plan. Such operating plans are short range or sub-plan which are useful in day-to-day operations. Programmes, budgets, schedules, etc are examples of derivative plans.
Establishing the sequence of activities:
• Once, the derivative is plans are prepared; the next step is to work out the sequence and timing of activities involved in each sub-plan. The sub-plans need to be integrated so as to achieve the goals as per the plan. The manager will then get a clear picture of final plan.
Review:
• Plans are periodically monitored to find out whether the performance is taking place as per the planned targets. If necessary, plans are revised in the light of changing environment and objectives of the organization.
Implementation:
• The various plans of the organizations are communicated to those whose participation is required to implement them. Implementation involves: 1. Organizing resources. 2. Directing Sub-ordinates. For effective implementation of the plan, it is essential that the employees clearly understand- ‘what is to be done, how it is to be done, when it is to be done and who needs to do it’.
4
Steps of Planning: How to analyze the Situation and Needs:
• The analysis step is about understanding the situation, problem or issue you wish to impact on better. It is also about understanding the needs of your target community in the context of that situation, problem or issue. • This analysis is important and should inform all the decisions you make in the rest of the planning process. It will help you in later steps to choose the most relevant and realistic goal, work out the most effective way of achieving your goal (objectives and strategies), plan to implement your decisions and plan what you will use to assess and evaluate your progress. • The purpose of this step is to build a common understanding about: 1. The current situation and how it affects your target group; 2. The deeper causes of this situation; and 3. Future situation you want to contribute to creating.
How to prioritize and Select the Goal and Purpose:
• In this step you will use your analysis of the situation and needs to make decisions about what the broad aim will be; what change you aim to help bring about in the lives of your primary stakeholder community. • In the Logical Framework Approach, a goal is a general statement of the situation you aim to contribute to bringing about.
5
• Goals are the reason why you undertake any activity and are often fairly general and long-term. Often, the change that is needed to make a really meaningful improvement in the situation of your target community and in their lives is complex and would require many different efforts to achieve. • It is still important for you to state this goal. The goal helps keep you focused on the important long-term change that is required, even though it is usually not possible for your organization alone to bring about the change. It helps you work out what contribution you can and will make to bringing about that longer-term change. It also helps you identify the other organizations working toward that goal so that you can co-operate with them. It is your goal that explains the meaning of what you hope to achieve. Your analysis of needs will assist you to identify what change will make a significant difference to the situation, issues or problems identified. • In the Logical Framework Approach, a purpose is the result your organization commits itself to achieving in order to make a contribution to the achievement of the longer-term goal. This should be something that your organization can realistically achieve by itself. The purpose describes why your organization, programme or project exists.
How to plan for evaluation:
• The systematic Logical Framework Approach outlined above includes planning for evaluation. It lays a systematic basis for transparency and accountability through providing a clear record of agreements. It allows for the inclusion of all those with a stake in the success of your work. It also lays a good basis for
6
agreement about what was achieved effectively, what was not and why it was or was not achieved effectively:
•
Your analysis of the situation and needs of your target community should have provided you with useful baseline information that tells you what the situation was when you started. If you are going to know how far you have come, you need to know where you started. The first three levels of objectives (goal, purpose and specific objectives) should have recorded agreement on the results you expect to achieve, or, in the case of the goal, that you expect to contribute to achieving. You will be able to use these to see if you have achieved these results. A key step in planning for evaluation is to clarify and finalize the criteria or indicators you will use to evaluate successful achievement of each objective at each level. The final step is to agree what information you will need to be able to evaluate the achievement of your criteria or indicators, where you will get it, how and from whom.
•
•
•
Setting of Clear & Realistic goals:
• You now need to help the group use the analysis to decide on a goal and purpose that are: 1. Relevant to the key problem or issue you have identified and its causes; 2. Realistic in terms of what you are capable of doing; and 3. Appropriate in terms of the needs you have analyzed. • As a facilitator, you need to show people why it is useful to set a goal and a purpose and what the difference is between them. Use the following to explain these terms:
7
• A goal is the long-term situation you believe should be achieved in the lives of your target group. Usually this is not something your organization and actions alone can bring about, but it needs to be something you can make a significant contribution to achieving through your efforts. This goal should be worded to describe the situation you would like to see, not the actions you will take to achieve it. This helps everyone to see what long-term impact you hope to be part of bringing about to improve the lives of your target group.
•
The purpose describes the situation that you intend to bring about from your activities. It is a positive situation you are committing yourselves to brining about through your efforts. The goal helps you ensure that the purpose is relevant to the large long-term change that is needed. The purpose helps you later work out what action will be required to achieve it. It helps you test your thinking by asking whether, if you do everything you plan, it will be enough to achieve the purpose. Again, you should not describe the action you will take but the change you intend to produce in the lives of your target group.
•
Implementation plans
• In this session, the facilitator needs to help participants make decisions on what activities will be needed to achieve each objective using the strategy agreed. Implementation plans or activity plans, as they are often called, need to be specific about: 1. What must be done 2. Who must do it 3. How it will be done
8
4. By when it must be done. • It is often useful to identify someone or a group that will take responsibility for each objective. This group can then be asked to draft an activity plan for achieving that objective. The following is based on this approach. 1. Give each group the sheet of flip chart paper with the objective they are responsible for and the agreed strategy written on it. Give each group at least four additional pages of flip chart paper. 2. Ask each group to write the heading "Activities" on one sheet of blank flip chart paper. The other sheets should be headed "Responsibility", "Deadline" and "Resources needed". 3. When the time is up, ask each group to present their thinking to the other groups. Allow questions for clarity first and then comments and suggestions
9
Strategic Planning:
• Strategic planning is a management tool and it is used for one purpose only: to help an organization do a better job - to focus its energy, to ensure that members of the organization are working toward the same goals, to assess and adjust the organization's direction in response to a changing environment. • In short, strategic planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization is, what it does, and why it does it, with a focus on the future. • Strategic planning helps an organization to know where its going over the next year or more, how it's going to get there and how it'll know if it got there or not. The focus of a strategic plan is usually on the entire organization, while the focus of a business plan is usually on a particular product, service or program • The process is strategic because it involves preparing the best way to respond to the circumstances of the organization's Which act as a obstacle for the organization, whether the organization is known in advance or not it must be ready to face any circumstances in future.
10
• Being strategic, then, means being clear about the organization's objectives, being aware of the organization's resources, and incorporating both into being consciously responsive to a dynamic environment • The process is about fundamental decisions and actions because choices must be made in order to answer the sequence of questions mentioned above. The plan is ultimately no more, and no less, than a set of decisions about what to do, why to do it, and how to do it. Because it is impossible to do everything that needs to be done in this world, strategic planning implies that some organizational decisions and actions are more important than others - and that much of the strategy lies in making the tough decisions about what is most important to achieving organizational success. • The strategic planning can be complex, challenging, and even messy, but it is always defined by the basic ideas outlined above - and you can always return to these basics for insight into your own strategic planning process. • Strategic planning has also been described as a tool - but it is not a substitute for the exercise of judgment by leadership. Ultimately, the leaders of any enterprise need to sit back and ask, and answer, "What are the most important issues to respond to?" and "How shall we respond?" Just as the hammer does not create the bookshelf, so the data analysis and decision-making tools of strategic planning do not make the organization work - they can only support the intuition, reasoning skills, and judgment that people bring to their organization. • Strategic planning, though described as disciplined, does not typically flow smoothly from one step to the next. It is a creative process, and the
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fresh insight arrived at today might very well alter the decision made yesterday. • Inevitably the process moves forward and back several times before arriving at the final set of decisions. Therefore, no one should be surprised if the process feels less like a comfortable trip on a commuter train, but rather like a ride on a roller coaster. But even roller coaster cars arrive at their destination, as long as they stay on track! • Strategy planning is a combination of rational, scientific examinations and educated, intuitive best guesses. Many individuals are overwhelmed by the idea of developing strategies, but it can be a fun and invigorating process. • The process entails: 1. examining the organization's critical issues 2. determining how the organization's strengths and skills can be employed to address the critical issues 3. analyzing opportunities and strengths and looking for ways to synthesize the two 4. exploring and choosing the best approaches for the organization. 5. Strategy means a plan designed to achieve a particular longterm aim. 6. Strategic planning is forming part of a long-term plan or aim to achieve a specific purpose. 7. Strategy planning is hard work. It helps the organization to work break free and help the company to grow physically and financially .
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Corporate Planning: Definitions of Corporate Planning on the Web:
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Drucker defined Corporate Planning as “the continuous process of making present risk-taking decisions systematically and with the greatest knowledge of their futurity; organizing systematically the efforts needed to carry out these decisions, and measuring the results of these decisions against the expectations through organized, systematic feedback.”
• Corporate planning is a well established discipline in large organizations. It deals primarily with long-term strategic matters. • It has its own methodology and is very different from normal business planning. • A typical business plan considers horizons of typically three or five years. A corporate plan will often have a horizon twice that of the business plan. • The majority of small and medium sized enterprises does not carry out corporate planning and do not think strategically. The owners and directors of most small and medium size enterprises believe that the tactical planning that they carry out amounts to strategic planning.
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• This belief is a major contributor to the very high failure rate of small and medium size enterprises during their first three years of existence. • Concentration on day to day management and tactical planning leaves the new enterprise vulnerable to changes in market conditions, reactions of competitors, delays by key customers and delays in the overall startup project. • Failure to consider values, vision and mission can contribute significant stress during the initial periods of rapid growth or startup problems. • As additional personnel join the enterprise the culture of the organization quite often changes. If the organization's values, vision and mission have not been clearly articulated, the developing culture may lead the organization off at a tangent that the founders had never intended. • Sometimes the founding owners end up in conflict as they each try to take the enterprise in different directions. This can be particularly dangerous if the founding owners have key skills or facilities which, if they remove them, can cause the business to fail. • If the business direction of the enterprise conflicts with the values of one of the founders there are bound to be problems. • The solution is relatively straightforward but is a process followed by few start up enterprises. • The following steps should be followed:-
1. Elicit the values of each of the key people involved in the enterprise. Any conflicts at this stage must be resolved and, if the differences cannot be reconciled, a methodology of avoiding confrontation must
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be determined. If this is not possible it is dangerous to proceed further without a significant risk of failure. 2. Based on the values determine the vision of the enterprise. This needs to be meaningful and inspirational, maybe even a bit frightening. Too many vision statements are meaningless and fail to inspire resulting in alternative, informal visions really driving the enterprise. • Do not forget - your enterprise is unlikely to ever exceed your vision so - think big. • If you want to know if your vision statement means anything give a copy to any potential recruit and ask them to explain what they think it means - the response can be very interesting. 3. Once the values and vision have been articulated the next stage is the mission statement. • Why should your enterprise exist, what does it do? • Does it do anything of any real use or is it just a method of obtaining money? • If it ceased to exist would any of your customers miss it? • What strategies are you going to use in order to achieve your vision? • This represents only the initial stages of corporate planning and the use of corporate strategy. However, if you miss this stage you will not produce a coherent strategy and will not have clearly defined corporate goals.
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ADVANTAGES OF PLANNING: THE NEED AND IMPORTANCE OF PLANNING CAN BE EXPLAINED WITH THE HELP OF ITS ADVANTAGES:
MINIMIZES RISKS:• Planning helps to minimize or reduce risks. • Potential risks are forecasted and necessary protective devices are decided well in advance. • If the risks occur, then the protective devices are put into practice. • The protective devices are the contingency plans that help to reduce risks.
FACILITATES COORDINATION:• The plans of one department are coordinated with the plans of all other concerned departments. • This brings in unity among the various departments of the organization. • In other words, the concerned departments work in close harmony in the implementation of the plans.
FACILITATES ORGANISING:• Planning enables a manager to organize the resources properly.
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• If required, he may make arrangement for additional resources in order to achieve the planned targets. • Depending upon the targets, the manager will make proper arrangement of resources.
FACILITATES PROPER DIRECTION:• Planning provides proper schedules or time table or to when the activities need to be conducted. • This facilitates the manager to direct his subordinates as and when required. • Clear directions can be given to the subordinates so that they undertake the right tasks at the right time.
FACILITATES CONTROL:• A plan provides a yardstick (target) against which actual performance can be compared. • Such comparison will enable to find out the deviations from the plans. • If deviations are noticed, the manager may take the right corrective steps at the right time.
GENERATES EFFICIENCY:• Planning enables optimum utilization of resources. All the resources i.e., physical, financial and human resources are put to their best use. • The optimum utilization of resources enables a company to achieve highest possible returns at lowest possible costs.
ENCOURAGES INNOVATION:-
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• The planning process encourages creative thinking on the part of managers. They strive to come out with innovative ways to achieve the results as per the plans even during the tough times. • The innovative ideas often bring best result to the organisation.
FOCUS ON GOALS:• Planning is goal oriented in the sense that plans are developed and executed to achieve certain goals. Every activity is directed towards the attainment of goals. • Activities are conducted in a systematic and smooth manner. • There is hardly any scope for haphazard activities.
FACILITATES DECISION-MAKING:• Normally, a manager frames alternative plans. • After necessary analyses of the plans, the best plan is selected. • Thus, planning facilitates the choice of the best plan. • Accordingly, managers take decisions to organize, to direct, and to control the activities.
MOTIVATES PERSONNEL:• Professional managers frame alternative plans in consultation with the subordinates. • When there is active involvement of the subordinates in planning, then they become highly committed to the achievement f the goals. Also, plans provide a challenge for the superiors.
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Disadvantages/Limitations of Planning: Time Consuming:
• There is a need to collect and analyses dad before framing plans. The subordinates and the concerned departments may have to be consulted. There may be a need to get approval from higher authorities. All this takes a good amount of time.
Paper Work:
• Planning requires a good deal of paper work, quite often, plans are drawn and re-drawn. Necessary reports are required to be collected from subordinates to prepare the final plans. Paper work is also involved in taking approval of the plans from the top management.
Expensive:
• A good amount of money is spent on collection and analyzing data which is required to frame the plan. The company may consult
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professionals before finalizing the plan, for which consultancy fees need to be paid.
Generates Rigidity:
• Manager may tend to achieve only what has been planned. Even if the situation permits them to achieve on the higher idea, they may not put extra effort .However, manager and their subordinates can be motivation to put in their best efforts and not just to stick to planned targets.
Generates frustration:
• At times, manager may not be able to achieve the planned targets despite their best efforts. This may generate frustration and loss of initiative on the part of the manager and other. However, necessary motivation and training may be given so that the manager and others can easily overcome the frustration and stress.
Danger Of Over-Targeting:
• There are cases, where functional manager plan the target on the higher side. This is more so on the part of the over enthusiastic manager. Again, the manager may get wrong data, or there may be wrong interpretation of data and as such over-targeting.
Danger Of Under Targeting:
• There are cases, where the manager deliberately frame plan with lower targets. This is because they can easily attain such targets and receive compliments for the same. This is more so in government and
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public sector organization. There may be genuine case of under targeting due to wrong dada collection and interpretation.
Danger To Human Error:
• Plans are based on forecast. A good deal of experience and judgment is necessary to forecast and frame the plan. There are cases where even the intelligent manger fails to judge certain factors and as such the plans were unrealistic. Thus, planning’s subject to human error or poor judgment.
Problem Of Technical Staff:
• Technical or creative staff may dislike plans and they call it as mere paper work which encroaches on their creativity. This can be corrected by giving proper training to technical staff so that they develop positive attitude towards planning.
Problem Of Changing Situation:
• Changing situation and conditions may throw even the best plan out of gear. For instance, there may be an unexpected natural calamity such as food or famine. This may take the plan ineffective. However, plan may be modified to meet the changing situations.
Resistance to Changing:
• Planning may often require structural changes in the organization. However, people are often reluctant to change. Unless the required changes are made, plans may not be of any use. Therefore, it is vital to make people aware that “a change is the only thing that has brought progress in the world”.
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Problem of Internal Conflicts:
• Plans are too framed in consultation and in coordination with the concerned departments. However, there may be disputes relating to the framing of the plans. For instance the production department may be willing to produce more units of ‘product A’, whereas; the marketing department may be instructed to sell more units of ‘Product B’.
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