Steps in Planning

Planning means a future course of action. So, in planning future action, there is a necessary step to go for it. While planning a plan, people must follow these steps to make sure that it will go in a right way to achieve their goals.

1. Analyze opportunity: This is the pre-step of planning. These step analyzes both internal as well as external environment. Management must analyze the SWOT (strengths, weakness, opportunity and threats), which are the changing environmental factors of the business. It involves analysis of one own strength and weakness in the light of possible future opportunities, threats or uncertainties and what one is expected to gain. Planning must know about materials, organizational structure, machines, political, socio-cultural, etc.

2. Setting goals: This is the actual starting point and also the first point of planning. Objectives must be clear, specific and practical in nature. The entire enterprises and then for each subordinate work unit should have their objectives. While setting goals, they should not be more ambitious or idealistic. Objectives must be realistic, specific and clear so that they focus on their objectives.

3. Determination of Premises: After setting the goal, next step of planning is a determination of premises. Planning premises refers to the anticipated environment which means expected environment. They include assumption or forecasts of the future. Planning premises may be tangible and intangible or internal and external. Tangible premises means an environment which we can see all the work done like units sold, time available, capital investment, cost per unit, etc. Intangible premises involves managerial attitude, goodwill, motivation, employees moral, etc. External premises involves technological change, government policy, social culture, etc. whereas internal premises involves management, machines, money, materials, etc. They provide useful facts and information in the work.

4. Determination of Alternatives: The next step of planning is a determination of alternatives. There is various alternative course of action, specially those which are not immediately changed. Management needs to identify all these alternatives to achieve the organizational goal or objectives. In order to identify all possible alternatives, management must collect and analyze all relevant information about it. Information can be collected from primary and secondary source.

5. Evaluation of alternatives: After the determination of alternatives, another step of planning process is an evaluation of alternatives. This is the logical steps to evaluate each and every alternative from cost and benefits point of view. All identified alternatives are evaluated and compared in terms of their expected costs and benefits. Each alternative is studied and evaluated in terms of common factors like resources, risk, responsibility, technology, required time length, expected return, etc. Both qualitative and quantitative tools are required and can be used for evaluation of alternatives.

6. Selecting a course of action: The next step of planning is selecting a course of action. This is the point at which plan is adopted. Management selects best course of action or must find out the most suitable course to follow after evaluating all available alternatives. Management must consider past experience, present situation and future contingencies of such decision. Therefore, it needs to consider about the various premises and environments of an organization.

7. Formulation of derivatives plans: After selecting a course of action, next step of planning is formulation of derivatives plans. In this step, plans are formulated for each stage of work, various supporting plans are developed for each product, department unit and activity. Such plan helps not only to implement the basic plan but also achieve the predetermined goals of the organization.

8. Implementation of plan: After selection of course of action, next step of the planning process is the implementation of plan. This step brings all the procedure of plan into an action. For this, plans need to take some steps such as communicate with subordinates who provide necessary instruction and guidance, an arrangement of resources like money equipment, machines, etc. and make timely supervision and control of subordinates.

9. Reviewing the planning process: This is the last step of planning. In this step, planner should know about the actual performance. It is the continued function till the organization exists. Management can take correct action in proper time only. Right decision should be taken at the right time to achieve the organization objectives in accordance with the plan. It is also important to adopt the changing environment of the business.

Reference

Poudyal, Dr.Santosh Raj. Principles of management. Bhotahity,Kathmandu: Asmita Book publishers & Distributors(P)Ltd, 2011.