Planning is concerned with determination of the objectives of the organization and formulating strategies, policies, rules and programmes to accomplish the objectives.
Steps in planning:
(a) Setting objectives: This is a first function in the process of planning. Objectives are the goals which determine what the organization wants to achieve. They must be specific, realistic and measurable.
(b) Developing premises: Planning premises are the assumptions about the future conditions and events like trends in population, changes in political and economic environment, variation in production cost and prices etc. plans should be framed within the framework of the planning premises.
(c) Identification of alternative course of action: Once the objectives are set and assumptions are made then alternative course of action should be identified. The management should know all the alternative course of action to achieve the objectives.
(d) Evaluating alternative courses: The next step is to analyze the strengths and weakness of each alternative. There is a need to evaluate each and every course of action in the light of objectives to be achieved.
(e) Selecting an alternative: After examining each and every possible course of action, the best is to be selected which is feasible, profitable for attainment of the objectives of the organization.
(f) Implementing the plan: This step is concerned with putting the plan into action to achieve the objectives. Implementation requires the formulation of policies, procedures, Budgets and programmes. It requires delegation of authority and responsibility to the subordinates.
(g) Follow up action: To see whether plans are being implemented are also a part of planning process. Monitoring the plan is equally important to ensure that objectives are achieved.
