LECTURE 5

• Lecture FIVE ( 5)

Dr Clive Mairura (PhD)

MANAGEMENT FUNCTIONS - PLANNING, CHARACTERISTICS OF SOUND PLAN –
STEPS IN PLANNING.

• Planning is the process by which a manager looks to the future and discovers alternate courses of action.
Planning describes the adoption of specific programme in order to achieve desired results. It means the
selection from among alternatives of future courses of action for the enterprise as a whole and each
department with in it. It is determining goals, policies and courses of action and it involves the processes like
work scheduling, budgeting, setting up procedures, setting goals or standards, preparing agenda and
programming.
• In the body of management knowledge, Planning is the MUSCLE and it allows the other functions to move in
the desired direction. Planning is not a forecast but an action oriented statement.
• Definition:
• The forward thinking (looking ahead) about course of action or activity (developing alternatives) based on full
understanding of all the related factors and directed at specified objectives.
•
• Why we need planning? Importance of planning:

Dr Clive Mairura (PhD)

 WHY WE NEED PLANNING? IMPORTANCE OF PLANNING:
• 1. Agri-business is a more complex activity.
• 2. Planning is essential for the business survival and development.
• 3. Planning reduces risks and safeguards against uncertainty.
• 4. It helps to achieve the objectives or goals and thereby move the things in a right direction.
• 5. It improves operational efficiency of resources
• 6. It is most basic function of management and a requisite to other functions.
• 7. Planning is an antecedent process. Planning process may be divided into different steps, such that a highest
priority will be given to immediate need and later to the less priority needs.
• 8. After dividing the entire planning process in to different steps, the problems are stated and objectives are
framed. These problems and objectives will serve as boundaries for thinking process to prepare a plan of
action.
• 9. While stating problems and objectives certain assumptions should be made depending up on situation
which may or may not be under the control of management. After stating the objectivesand assumptions, the
plan of action will be prepared to accomplish objectives and goals.
• 10. Planning necessitates faithfulness to objectives.
Dr Clive Mairura (PhD)
TYPES OF PLANNING

•In agri-business planning may be of several types.

This includes:-
•1. Financial planning
•2. Industrial relations planning
•3. Research and development planning
•4. Physical facilities planning
Dr Clive Mairura (PhD)
LEVELS OF PLANNING.
The below table shows different levels at which various types of planning occur .
POLICY LEVEL MIDDLE LEVEL SUPERVISOR PRODUCTION
LEVEL LEVEL
Very flexible Somewhat Discretionary Inflexible
flexible changes
Long range Intermediate Short term Immediate
term
Written Written Outlined Unwritten
Analyses Reports - -
Complex Less detailed Highlighted Simple
detailed Outlined - -
Broad General Some what Very specific
specific
Dr Clive Mairura (PhD)
PLANNING MOVES FROM CHIEF EXECUTIVE TO THE WORKER. SEVERAL NOTABLE CHANGES
OCCUR IN BETWEEN.
1) At the top level, plans have a tendency towards flexibility, are longer range,
are usually written, are more complex, and are broader in nature. At
production (lower) they are vice versa as shown in above table.

2) All the plans would benefit from being written down because written plans
tend to consolidate thoughts, are easier to communicate, and to provide a
source for further reference.

3) The executives make plans that are generally add or subtract resources from
the agribusiness, while those plans that are made at the lower levels
generally relate to using the existing resources in the most efficient manner.
Dr Clive Mairura (PhD)
 10 CHARACTERISTICS/ ATTRIBUTES / FEATURES OF A SOUND (GOOD) PLAN:

1. The objectives formulated in plan should be within available resources and available information.
(Generally while setting the objectives for any enterprise the important factors to be kept in mind are:
Market share and market stand among the competitors, How fast in growth?, amount of profits?,
employee’s relation and performance, profit distribution percentage, public relations, kind of equipment
needed, research for new products etc.,)
2. The plan should be flexible i.e. it can be suitably changed according to situations.
3. The plan should increase the resource use efficiency and should reduce wastage.
4. The objectives formulated in plan should be very clear without any confusion
5. The plan should carry various alternative courses of action with in available resources.
6. The plan should employ modern techniques in production and marketing of agricultural products.
7. Plan should stabilize the earnings of the firm.
8. plan should avoid possible risks and uncertainties
9. Plan should give consideration for efficient marketing of products.
10. Plan should provide programme for obtaining usage and repayment of credit and loan.

Dr Clive Mairura (PhD)

SIX STEPS INVOLVED IN THE PLANNING PROCESS:
• 1. Gathering the facts and information that have a bearing on the situation.
(Assessment of resources available with business firm)
• 2. Analyzing what the situation is and what problems are involved? (Analyzing
the existing operations in business firm)
• 3. Forecasting the future developments (Identification of defects in existing
plan of business firm)
• 4. Setting goals, the benchmark for achieving the objectives. (Discussions with
specialists to examine possible improvements in existing plan)
• 5. Preparation of various alternative plans with in the existing level of
resources under the guidance of specialists or scientists and selecting the most
suitable one.
• 6. Developing a means of evaluating progress and readjusting one’s sights as
the planning process moves along.
Dr Clive Mairura (PhD)
TYPES OF PLANS or HIRARCHY OF PLANS:
• It is very easy to see that a major programme, such as to built and
equip a new factory, is a plan. But what is sometimes overlooked is
that a number of other courses of future action are also plans. So a
plan encompasses any course of future action, we can see that
plans are varied. They are classified as:-
1) Purposes or mission,
2) objectives,
3) strategies,
4) policies,
5) procedures,
6) rules,
7) programmes,
8) and budgets.
•

Dr Clive Mairura (PhD)

 1. PURPOSES OR MISSIONS:
• Every kind of organization should have a purpose of establishment or mission. Generally
many organizations may have a social purpose of producing and distribution of economic
goods and services, it may accomplish this by fulfilling a mission of producing certain lines of
products. The mission of Reliance Oil Company is to search, produce, refine, market and
producing wide variety of petroleum products.

• Every kind of enterprise in the society should know who its customers are and what they
expect. It is some times thought that the mission of a business, as well as objective is to
make profit, to survive and do the task society entrusted to it. But this basic objective is
accomplished by undertaking activities, going in clear directions, achieving goals and
accomplishing a mission.
•

Dr Clive Mairura (PhD)

 [Link] OR GOALS:
• The planning process starts with setting of objectives. Objectives or goals are the ends towards which the
activity is aimed at. Objectives are the statements developed by the top management, board of directors, and
chief executives to define what they believe to be the organizations mission. These are the shining stars that
provide light to the path of subsequent planning and thinking. They are the targets towards which goals are
aimed.

• The enterprise objectives constitute the basic plan of the firm, while the departmental objectives are
attained through fulfilling the assigned goal. For example Philips Company’s objective is to make certain profit
by producing a given line of production of music systems, while the goal of the manufacturing department
might be to produce the required number of said systems.

• These also the most neglected of all the planning segments. This neglect occurs because managers either
avoid the mental exercise needed to set objectives or fear the failure that might be evidenced by an inability
to reach them.

Dr Clive Mairura (PhD)

 [Link] OR GOALS:
• Management has multiple objectives which are inter-related. Objectives mean short term
• goals in a business firm. Depending on the period of action objectives are classified as
• (i) Short range objectives, which are to be fulfilled immediately with in a short period.
• (ii) Long range objectives, which are also known as goals. They can be terminated at a
certain point in the long run or they can be continued depending up on the situation.
• The objectives enable the managers to plan, organize, direct and control the business and
other resources in proper direction. They also help in efficient utilization of resources in a
business.
• Nothing is important to the long-range success of an agribusiness as written, well-thought
out objectives. Quite simply, an organization that knows where it is going is much likely to
get there than one that depends on arriving by accident.
•

Dr Clive Mairura (PhD)

 [Link] OR GOALS:
• Well stated objectives should:
• 1. Record the direction the agribusiness should take.
• 2. Provide guides for the goals and results of each unit or person.
• 3. Allow appraisal of the results contributed by each unit or person.
• 4. Contribute to a successful overall organizational performance.
• 5. Indicate the philosophy and desired image of the organization.

• Objectives should be broad, long-range, flexible, and not necessarily time-oriented. Most
agribusiness will have at least five objectives, and a few might have ten or more. An
organization with more than ten overall objectives is almost certainly mixing goals with its
objectives.
•

Dr Clive Mairura (PhD)

 [Link] OR GOALS:
Objectives are usually found on the following business areas:
1. Market standing (position compared with competitors)
2. Growth and development (how much and fast should growth be?)
3. Profitability (what kinds and amounts of profits are feasible?)
4. Employee relations and performance (What rewards and share of income should go to
employees, and what is expected of them?)
5. Investor relations and return (What portion of earnings should go to investors?)
6. Public responsibility and relationships (What kind of business citizen does the company
want to be?)
7. Physical resources (What plant equipment, tools, etc., are needed?)
8. Products and innovation (What emphasis will be placed on new products and research?)

Dr Clive Mairura (PhD)

 3. STRATEGIES:

• Strategies denote a general programme of action and an

implied deployment of emphasis and resources to attain
comprehensive objectives. According to Chandlar, the
Strategy is “the determination of the basic long-term goals
and objectives of an enterprise, and the adoption of courses
of action and the allocation of resources necessary to carry
out these goals”. Ex: Nano car from TATA is a strategy to
capture the market of adjacent countries as well as to pose
competition to the native manufacturers.

Dr Clive Mairura (PhD)

 [Link]:
• Policies are used to guide one’s thinking process during the planning or
decision-making stage. The formulation of policies allows everyone to
consistently make decisions that are in line with organizational objectives.
The policy sets boundaries within which an agribusiness employee can exert
individual creativity. For example, one business unit instituted a policy that
the general manager must approve all purchases compulsorily that totaled
Rs. 500 or more. The purpose of such a policy was to protect the business
against unexpected large cash drain.
• Policies are not the objectives, although they are closely tied to objectives.
Because they are not the objectives, policies should never be used to fence in
managers as they make decisions about long-range, complex problem
situations.
•

Dr Clive Mairura (PhD)

 [Link]:
• A procedure is a step-by-step guide to a specific activity or function. In
many cases, there is a definite need to set out just such a precise course
of action. A procedure should not, in most cases, be applied to complex
tasks of a long-range nature. If the business firm sought to implement its
new purchasing policy, the procedure involved called for an employee to
fill out a requisition
• form, submit it to the general manager for approval, then send it to the
purchasing director. Procedures work best when they are applied to
routine and recurring tasks of a relatively simple nature that require
control.
• Both policies and procedures are of tremendous value to the new
employee who is learning on the job, majorly to prevent unauthorized
actions.
Dr Clive Mairura (PhD)
 [Link]:
• Practices represent what is actually done in the agribusiness, and they may conflict with
policies and procedures. Managers have to be sure that policies make sense, are relevant,
and are enforced, in order for them to become widespread practices.
•
• A course of action that is established on a recurring basis becomes a practice, often by
tradition or habit more than anything else. The status of practices can become as important
as that of either policies or procedures, and even more difficult to change, so the
agribusiness manager must see to it that practices coincide with policies and procedures.
For instance some agribusiness company is practice to give sweets on Dewali to their
employees, some follow a policy of sharing a portion of profits with their employees.

Dr Clive Mairura (PhD)

 7. RULES:
• Rules are frequently confused with the
policies and procedures. A rule is that it
reflects a managerial decision that certain
action be taken or not be taken. A rule
requires that a specific and definite action be
taken or not taken with respect to a situation.
As a matter of fact, a procedure could be
looked up on as a sequence of rules.

Dr Clive Mairura (PhD)

 [Link]:
•Programmes are a complex of goals, policies,
rules, task assignments, steps to be taken,
resources to be employed, and other elements
necessary to carry out a given course of action and
are ordinarily supported by the necessary capital
and operating budgets. Designing programme
therefore truly requires the most rigorous
application of systems thinking and action.
•
Dr Clive Mairura (PhD)
9. BUDGET:
• It is a plan of statement of expected results expressed in numerical terms. It
may be
• referred as a “numberised programme”. The financial operating budget is
called as a profit plan and
• may be expressed in terms of labopur-hours, units of products, machine-
hours, etc.,
•
• It is a fundamental planning instrument in many companies because it
forces a degree of
• definiteness in planning.
•
Dr Clive Mairura (PhD)
ORGANISING – MEANING – PURPOSE – STAFFING – DEFINITION – STAFFING PROCESS.
• ORGANISATION:
• Meaning: In any business activity there is always a person who guides and controls its functions. He also co-
ordinates and regulates all the factors which are employed in the business activity. Apart from monitoring it,
he takes the responsibility of the outcome. We call such a person an entrepreneur (organizer) and the
business activity which he is doing is called an enterprise or organization.
• If management is seen as a body of knowledge, then the organization is skeleton or framework on which the
management is built.

• Barnard referred to an organization as the activities of two or more persons were concisely coordinated
towards a given objective. An organization structure is effective if it facilitates the contribution of individuals
in the attainment of enterprise objectives.

Dr Clive Mairura (PhD)

 PURPOSE:
• The purpose of organization in an enterprise involves
• 1. The process of identification, classification and grouping up of required activities
• 2. Grouping of activities in light of resources and situations
• 3. Assigning these activities to positions
• 4. Delegation of the authority to different persons and
• 5. Horizontal and vertical co-ordination of the authority and information relationships to enable them to
carryout these activities very effectively and efficiently towards achieving the objectives.
• Organization brings co-operation, harmony and integrity among the people.
• As a part of the organization function, the agribusiness manager must see that each employee has a role that
is clearly defined. The employees’ work goals, the decision to place some one in charge, and the overall goals
of the organization, coupled with the ways in which each person and department relate to each other,
comprise the organizational plan. Such a plan allows management to establish accountability for the results
achieved; it prevents buck passing and confusion as to who is responsible; and it details the nature and
degree of authority that is given to each person as the activities of the firm are accomplished.
• The process of organization starts with staffing and recruitment of persons.

Dr Clive Mairura (PhD)

 FUNCTIONS OF ORGANIZER:
•1. To determine the jobs to be done by the
staff (job description, selecting, allocating
&training personnel)
•2. Defining the line of activities of the staff.
•3. Establishment of relationship among the
staff.
•4. Selecting and training of personnel in
organization.
Dr Clive Mairura (PhD)
STAFFING: (HUMAN RESOURCE MANAGEMENT)
• It is defined as the process of filling the positions in an organization structure through
identifying work-force requirements, inventorying the people available, recruitment,
selection, placement, promotion, appraisal, compensation and training of needed people to
carry out the business activities very effectively.
• Staffing should be based on the need of the enterprise operation and day to day running of
the business with out any sort of hindrance. On the basis of the need, Managers should
determine the number and type of persons to be staffed in the enterprise.
• The manager of the firm should develop a strategic staffing plan in such a way that the
working by all in a collective way without the feeling of overwork. The staffing plan with
specification of the positions / jobs should always thrive to fulfill the set objectives of the
firm.

Dr Clive Mairura (PhD)

 STAFFING: (HUMAN RESOURCE MANAGEMENT)
• Once the staffing plan is prepared, the duty of the manager is to develop the job description
(i.e. the work should be performed by the specific position) in a constructive way so that the
qualified people should think that they should not leave the opportunity of working with that
enterprise.
• Organization and staffing go side by side. Staffing starts with recruitment of personnel.
Recruitment starts with specification or qualifications of individual who will occupy important
positions to carry out the activities of organization.
• There are different ways of recruiting the staff.
• 1. Advertising in news papers, other forms of media
• 2. Recruiting through persons who are already working in the organization
• 3. Recruiting through friends
• 4. Considering the persons who knock at the doors of organization, etc.

Dr Clive Mairura (PhD)

 SELECTION PROCESS:
1. The performance of chosen person on the job is the best criterion.
2. The application of the firm is usually carries information pertaining to personal data of applicant and his
educational background, training he has undergone, work experience if any, salary history, special interest of
individual if any etc,.
3. An interview will be conducted through which mental alertness, sense of values, quickness of judging, general
orientation, communication skills, degree of professionalism etc., of the applicant will be studied. Besides such
mental ability of the individual, language efficiency of persons is also studied.
4. The applicant’s academic record usually serves a major indicator for selection process.
5. In highly specialized jobs, the academic record is the best criteria.
6. In the case of managerial positions along with academic record and leadership qualities communication skills
assume greater significance.
7. The reference letters submitted by the applicant are of some use, but some managers do not give much
importance to such reference letters because applicant submits such letters which are with favourable comment
from previous organization.
8. Examination of physical fitness of individual is most common in any organization because no organization will
ready to recruit a sick person.
9. Good organizer selects the person with fairly above average academic record with extracurricular activities
which give rise to a good leadership.
Dr Clive Mairura (PhD)
DIRECTING – MOTIVATION – ORDERING – LEADING – SUPERVISION
COMMUNICATION AND CONTROL – MEANING AND DEFINITIONS.

• Direction is nothing but motivating, ordering, guiding, leading, executing and supervising the organization. It
is an important management function making the people engaged in various positions to move towards the
achievement of goals and objectives.

• Managers as directors know that the successful measure of the output / profits is due to sum of the
performance or work output of all those who work under their control in the firm. Such mangers recognize
that no one or some one in the firm is completely satisfied. It is also true that all employers can not be happy
all the time. The good manager would always have good qualities of directing and building leadership that
could help his staff to succeed in their work and derive job satisfaction in their work. Good directors always
change their styles to bring about the desired changes.

• He identifies the skills of the workers in the firm and assigns such job to execute.
• The function of directing is compared to HEART of body of management.

Dr Clive Mairura (PhD)

THE DIRECTION FUNCTION OF MANAGEMENT HAS THE
FOLLOWING WORKS:
•1. Assigning duties and responsibilities to
personnel.
•2. Establishing the results to be achieved.
•3. Delegating the necessary authority
•4. Creating a desire for success.
•5. Supervising that the job is done properly by
workers.
Dr Clive Mairura (PhD)
 ORDERS:
• Orders or instructions are the vehicles for messages with proper direction from top to bottom
of an organization.
• Features of orders:
1. Orders should be very clear and understandable
2. Generally orders are unidirectional and moves from top to bottom operating units
3. The timing of orders is crucial i.e. they must be issued when needed and should reach the
gross root level workers in time.
4. To have a check whether the orders are converted into action, a feed back report should be
the source of orders
5. Orders vary in form and details depending up on the degree of delegation practiced in the
organization. Some of them are negative, which prohibit certain actions, whereas some orders
are positive, prescribing the course of action towards the attainment of objectives.
A firm should be conditioned for effective direction. The manner in which it is organized could
facilitate conditioning. Often, it is necessary to keep persons in the organization, both as
individuals and as groups motivated for proper direction. The workers must also find meaning
and purpose in the orders and in implementing the orders.
Dr Clive Mairura (PhD)
 CO-ORDINATION:
• Co-ordination is unifying and synchronizing action of group of people in the firm.
• It is considered as the BRAIN in the body of management skills.
• Sound, good and command of management skills will keep the need for coordinating
function at a minimum level. The good manager would always strive to co-ordinate
operations, departments and individuals under their control and properly work for their
integration to achieve the desired results.
➢ In general coordination means working together by
• 1. Interpreting the programmes, plans, policies, proceeds and practices.
• 2. Providing for growth and development of employees.
• 3. Keeping in touch with the employees.
• 4. Conditioning the firm for its success.
• 5. Providing the free flow of information.

Dr Clive Mairura (PhD)

 CO-ORDINATION
• The manager must work hard for welfare of the employees. Efficient workers
must be rewarded & promotion policies should be designed. Bonus distribution
should be timely and adequate. Accommodation, transport, medical and
education allowances, training facilities should be provided.

• The good manger should identify the hidden talents of personnel by stimulating
them through varied assignments that offer continuously increasing challenges
and opportunities. He should have regular schedule of contacts with his staff.
He should set himself as a good example to others.
• A good coordinator continuously and carefully seeks the participation of
workers. His actions should always be result oriented. He should inspire
confidence and motivate the staff with his skills.

Dr Clive Mairura (PhD)

CO-ORDINATION
• Work climate: Without a proper working climate, none of the skills and
principles of management can flower and bear fruits,
➢ Six Principles of creating the climate:
• 1. Set a good example himself by the manager
• 2. Conscientiously seek participation
• 3. Be goals-and results- oriented
• 4. Give credit (in public) and blame (in private) as needed
• 5. Be fair, consistent and honest
• 6. Inspire confidence and lend encouragement.
➢Good managers know how to use these principles to create a productive
working climate.
•
Dr Clive Mairura (PhD)
 COMMUNICATION:
➢The key to the success of any of the management functions is the free flow of
communication. The agribusiness manager is responsible for designing and
implementing the communications process.

➢Free flow of information means that communications must flow not only downward
(from management to subordinates), but upward (from subordinates to managers)
and laterally (at the same level) to be effective. Too often managers depend almost
exclusively on downward communications and then wonder why policies,
procedures, and goals are misunderstood. Successful communications require feed
back. Feed back allows the managers to see whether understanding has indeed
occurred. It also allows the good ideas and potential contributions of each
employee to be part of the success mix of collective wisdom and knowledge found
in the organization. The manager must provide the opportunity for this feed back
and involvement through a carefully designed communication process involving
comities, meetings, memos and individual contacts.

Dr Clive Mairura (PhD)

 COMMUNICATION:
• No matter how well thought out the organizational structure is,
there will be times when it breaks down. In such a situation the
complex operations that do not always work the way they are laid
out on the paper. People have emotions, misunderstandings and ego
needs that sometimes get in the way, especially during seasonal
peaks of hectic activity, when they get physically and emotionally
tired. Effective management recognizes the need for interpreting the
formal structure in terms of the human element, by adjusting and
working through misunderstandings when they occur. No
organizational structure can be successful without a constant
concern about honest but tactful communication at all levels.
Dr Clive Mairura (PhD)
 CONTROL:
• Control function is complementary to other management functions
and considered as NERVOUS SYSTEM of body of knowledge that
reports the function of the parts of the body to the whole system. It
measures the deviations from the desired course of action and
thereby suggests for desired direction.
• Definition: Controlling is the process of influencing the
performance or executing the supervision, so that the results of
organizational efforts will reach the expectations.
• Massie stated four essential elements of control as follows:
1) A pre-determined criterion / goal / benchmark.
2) A means of measuring current activity quantitatively, if possible.
3) A means of comparing current activity with a prefixed criterion.
4) Some means or measures of correcting current activity to achieve
desired criterion / goal.
Dr Clive Mairura (PhD)
CONTROL:
• Control does not mean restriction of power over subordinates. Control system
sounds a
• warning when necessary for taking up remedies for problems. Workers in
general make mistakes, so the plans finally could not be executed according to
schedule. Then there will be great need for having control system to set right the
things. Through proper controlling, managers would become aware of weak
spots in organizational, directional and co-ordinating efforts and operations of
the business.
• Another important purpose is to evaluate the progress being made towards
organizational goals. In the absence of control system employees can not respect
the programmes, disregard and in-accuracy are likely to result. The control
programmes should be checked periodically and reviewed so that the irrelevant
control programmes can be dropped.
• To be successful, the agribusiness manager must apply this functional
knowledge and ability to each of four basic areas of agribusiness viz., financial
management and planning, marketing and selling, production and operations,
and personal and human dimension.
•

Dr Clive Mairura (PhD)