Planning Process

• Planning means deciding in advance what to do and how to do it.
• It bridges the gap between where we are and where we want to go.

1. Setting Objectives

• Define what is to be achieved - for the organisation and for each department.
• Objectives guide action and channel effort.
• Example: Increasing sales by 20%.

2. Developing Premises

• Planning is done for the future, which involves uncertainty.
• Premises are assumptions about the future environment in which plans will operate.

3. Identifying Alternative Courses of Action

• List all possible ways to achieve the objectives.
• Alternatives may be routine or innovative.

4. Evaluating Alternative Courses

• Weigh the pros and cons of each alternative.
• Consider feasibility and consequences.
• Example: Analysing risk–return trade-offs in financial plans.

5. Selecting an Alternative

• Choose the most feasible and profitable option.
• Decision is based on managerial judgement.
• Sometimes a combination of plans may be selected.

6. Implementing the Plan

• Translate the chosen plan into action.
• Example: Arranging additional labour and machinery when increasing production.

7. Follow-up Action

• Monitor whether activities are conforming to the plan.
• Check whether objectives are being achieved.

• Planning is deciding in advance what to do and how to do it.
• The planning process has seven steps, from setting objectives to follow-up.
• Premises are future assumptions that form the basis of planning.
• Alternatives must be evaluated before one is selected.
• The best alternative is the most feasible and profitable; combining plans is also an option.
• Implementation involves putting the selected plan into actual action.
• Follow-up ensures the plan stays on track and objectives are met.