[Commerce Class Notes] on Types of Plans Pdf for Exam

Planning is one of the most crucial steps in any business, without Planning an organisation can never achieve the success they desire. If the organisation has a unique service or product to provide to the consumer, that is not available anywhere in the market, and only one particular organisation can provide it, and also this very product or the service can add so much value into the life of the consumer, then chances are the organisation or the business is going to achieve a great level of success, by that product or service. But everything can fail if the organisation has not worked out the plan for itself. Because as said, Planning is an essential part of any business.

If the organisation has limited resources but a great plan to optimise the use of those resources, then the organisation is going to be successful. In a nutshell, Planning is very important and the students of commerce are supposed to learn about Planning at a young age, and hence the same is included in the syllabus and the same is provided by the .

Though Planning seems a rather simple thing, there are various types of Planning and hence here describes everything related to Planning.

Nature of Planning

• It is a Continuous Process: Planning never stops for an organisation, it is an ever-going process. As long as the business operates in the market, Planning is going to be there in the organisation.

• It is a Managerial Role: Planning is an important part of the job profile of the manager because the manager is the one who is supposed to make a good plan that can make the organisation grow, while the employees are supposed to follow the plan.

• It is Omnipresent: In the business, organisation Planning is everywhere, not a single function or the department in the business is present there, which can work without an efficient plan.

• It is the Success of Subsequent Plans: Planning makes the organisation grow, and when the organisation grows, it requires further plans and hence in this way the success of the subsequent plans helps the other plans.

By considering its four main aspects, the essence of planning can be understood. These are:

Characteristics of Planning

• Managerial Role: Planning is a managerial function that provides the basis for other management functions, i.e. coordinating, staffing, directing, and controlling, as they are carried out within the periphery of the plans made.

• Objective-Oriented: It focuses on the definition of the organisation’s objectives, the identification of possible courses of action, and the decision on the required action plan to be followed to achieve the objectives.

• Pervasive: It is omnipresent in the sense that it is present in all segments and is required at all organisational levels. Although at various levels and agencies, the complexity of preparation varies.

• Continuous Process: Plans for a particular term, such as a month, quarter, year, and so on are made. When the time is over, fresh proposals are drawn up, taking into account the current and future needs and conditions of the organisation. It is also an ongoing process, as the plans are framed, implemented and another plan is pursued.

• Intellectual Process: It is a mental activity that includes applying the mind, thinking, anticipating, intelligently imagining and innovating, etc.

• Futuristic: We take a sneak look at the future in the course of preparation. It includes looking into the future, evaluating it, and forecasting it so that the organisation can better face future challenges.

• Decision-Making: Decisions are made with regard to the selection of possible courses of action that can be taken to achieve the objective. The preferred alternative should be the best of all with the lowest number of negative results and the highest number of positive results.

Planning is concerned with the setting of goals, targets, and the development of strategies to achieve them. The exercise lets managers evaluate the current situation to find ways of maintaining the desired role in the future. It is both the organisation’s need and the managers’ responsibility.

Importance of Planning

• It allows managers to boost potential results for the good of the organisation, by setting targets and choosing a course of action.

• This minimises danger and misunderstanding by looking forward to the future.

• Coordination of events is encouraged. Therefore it reduces duplication between operations and removes unproductive jobs.

• It states in advance what needs to be achieved in the future, so it offers instructions for action.

• It uncovers potential opportunities and risks and detects them.

• It sets out control criteria. It contrasts real performance with normal performance and attempts are made to correct the same performance.

Planning is very important not just for organisations, but also for individuals, for success and the successful performance of an organisation. It is the most fundamental of all the roles of management. The first of the basic managerial tasks are planning. Planning is important as it inquires about organisational priorities by default and includes decision-making in preferred ways and means of achieving goals. This requires the collection of missions and targets and the steps to achieve them. Consequently, each company puts a greater focus on planning.

As a process, planning includes deciding the potential course of action, which is why action is taken, what action is taken, how an action is taken, and when action is taken. 

Types of Plans

Plans are mainly divided into two Types, which are the Single-use plan, and the Standing plan.

• Single-use Plan: Single-use plan as the name suggests is the plan that is used only once in order to achieve a particular goal, and that is why it is also known as the specific purpose plan because the plan gets discarded after the purpose is achieved. And the new plan is then created. Goals, Programs, ventures, and budgets are the four common forms of single-use plans.

• Standing Plans: Again, as the name suggests these are the plans which stand for a rather long time, that is to say, the Plans which are used by an organisation, again and again, are called standing Plans.

Difference Between Single-Use Plan and Standing Plan