Planning: Types of Plans
Planning is process of taking decisions in advance about a future course of action. It is one of the function of management process. It always focuses on the future course of acts and their impact. Planning is the first and primary function. It helps to reduce the level of risk. Planning is classified as standing plans and single-use plans. Planning helps to implement various principles of administrative management.
Standing plans
Mission
Mission is the organization’s purpose and overall intention. Mission directs all the activities and short-term goals of the organization. It indicates the reason for running a business. Standing plans used for a longer period or forever in the organization. The purpose of the standing plan is to implement and achieve sustainable growth for the organization. It directs all the short-term plans.
For example,
An educational institute’s mission statement: “Our mission is to make use of Engineering & Technology the principal instruments of economic development to improve the quality of life of people through Education”
A business organization may have a mission “To become a quality leader in the market by offering excellent products and services”
Vision:
Vision is how the organization wants the world to be in which they operate the business. It is the long-term future of the organization and its influences. The mission belongs to the vision and intention of the organization to accomplish.
For example,
Vision statement Infosys: “Shape and share solutions that serve the development of businesses and communities”
The vision statement of Tata Steel: We aspire to be the global steel industry benchmark for Value Creation and Corporate Citizenship.
Policies
Policies are the guidelines for repetitive actions implemented or executed in an organization. these are the plans which implemented for a longer period or forever.
For example,
The human resource policy of an organization is appointing or hiring experienced employees
Safety policies of manufacturing organizations protect and compensate employees.
The pricing policy of business organizations is always towards satisfying and attracting the customers
Procedures
Procedures are the guidelines for action implemented in the organization. procedures are the way the activities, and tasks are handled. It specifies the sequence of activities to complete a specific event.
For example
The procedure of hiring the workers or operators
Procedure for obtaining the loan from the bank
Procedure for getting advance from the finance department
Procedure for admission into MBA or any other professional course
Rules and methods
Rules are the framework that shapes and directs various activities in a specific way. Rules implement discipline and hold control over various activities in the organization. rules can avoid any unnecessary activity which creates unnecessary outputs or results.
For example,
Employees can not smoke in the organization
Carry safety tools if necessary while working
Follow all the safety norms while working
Strategies
Strategies are plans made for the long term and are beneficial for obtaining the expected results. Many types of strategies the companies implement to achieve a specific objective.
For example
Reliance Jio in India used the pricing policy to obtain a maximum number of Jio customers. Initially, they provided the services free or at very low prices. They made customers habitual of consuming the data. Now they can obtain huge revenue by charging on data consumption.
The human resource department may implement a specific strategy to make employees more potential.
Single Use Plans
Single-use plans are the plans which are implemented for a short period and once. These plans are important and flexible to achieve specific goals. Single-use plans are guided by standing plans.
Programs
Programs are plans which are made for a short period and to accomplish specific objectives. Programs are made by the standing plans such as procedures, policies, and objectives of the organization.
For example
The human Resource department arranges the training program to increase the skills of employees. The purpose of the training program is to make employees more potential. This purpose is the objective of making the organization’s workforce more potential and productive.
Induction programs in the organization make employees familiar with the organization’s culture and code of behavior. It also makes employees aware of their responsibilities, authorities, and the way it has to complete.
Projects
A project is a set of activities, tasks, or events that the organization completes to accomplish a specific goal or output. Projects have a specific budget and the period in which it is expected to complete.
For example,
- Construction company may complete the project such as the construction of a building, dam, bridge, etc.
- Software companies complete the project for different private clients or governments.
- Electronic company can complete the project of manufacturing frequency converter required for the army
- ISRO(Indian Space Research Organization) and DRDO( Defence Research and Development Organization) complete different types of projects. These projects completed for a specific purpose within a specific budget and period also.
Budgets
The budget involves allocating the finance for the execution of different activities of the organization. budgeting plays important role in fulfilling the sufficiency of finance for all the departments. A budget is a single-use plan made by financial management.
For example,
The advertising budget determines the expenditure on promoting the product or services to increase awareness among customers.
R & D department may have a sufficient budget due to which they can facilitate the innovation.
Allocation of finance for the purchasing of the machinery
Allocation of funds for the maintenance of machinery
Standards
Standards are the minimum expectations in various factors or parameters. Standards are the plans that direct various activities in a specific way. Standards provide the way every activity of a business organization is to execute. It focuses on excellence in the execution of the activity.
For example
Quality standards direct the employee on how to maintain the quality of the products or services.
The Standard of selecting the employees determines the way new and capable employees are selected.
Standard in the specifications and measurements of manufacturing the products directs the efforts of manufacturing.
Standards in performance appraisal help to measure the performance or productivity of employees. Standards of employee productivity compared with actual productivity and the decision taken regarding promoting the employees.
Standard in financial management practices such as determining the budget for the specific activity of the business. Standard methods to determine the optimum level of production capacity, and inventory management. Standardization plays important role in achieving optimum utilization and reducing unnecessary spending.