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The Phases of Economic Development The Phase/Stages of Economic Development
Organization & Management
The Nature and Levels of Planning and Types of Plans
Definition and Nature of Planning
Planning is the process of thinking before doing. We have already been introduced to five essential
functions of a manager which is Planning, Organizing, Staffing, Leading, and Controlling. This is also
considered as a conceptual framework of management.
What is Planning?
• It is the most basic of all managerial functions
• the process by which managers establish goal, define methods and think of strategies by which these
goals are to be attained
How do prominent people view planning?
• According to Weihrich and Koontz, “Planning involves selecting missions and objectives and the actions
to achieve them; it requires decision making, which is choosing from among future alternative course of
action.”
• According to Newman, “Planning is deciding in advance, what to is to be done, that is a plan is a
projected course of action.”
➢ So planning is thinking ahead as to the future course of action.
➢ It is also acceptable to say that planning is the process of thinking before doing.
• Henry Fayol defines planning as “deciding the best alternatives among others to perform different
managerial operations to achieve the predetermined goals.”
What is the Nature of Planning?
Planning is not an easy task; it involves intellectual thinking and mental activity to be able to plan
effectively. The nature of planning can be highlighted as follows:
• Planning is goal oriented. A manager cannot do planning unless the goal is specified. Every
step specifies an action plan to be able to attain the desire goal.
• Planning is futuristic in nature. Planning means looking ahead.
• Planning exists in all managerial activities. It is the primary function of managers at all levels.
• Planning is not a guess word. It is based on facts and information.
• Planning is flexible. It is dynamic in a process capable of adjustments by the need and
requirements of the situation.
Levels of Planning
1. Corporate Level
An organization’s overall strategic direction is normally planned at the corporate level. Planning
at the corporate level as Kuye and Oghojafor (2011) point out is carried out by a senior leadership within
an organization.
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This explains why this level of planning is usually referred to as a grand strategy bearing in mind
that it constitutes that level of decision making which dictates the activities of all the other levels. A
leader in this case provides a mission and a vision which is duly needed in the organization towards
accomplishing the set goals and objectives
2. Business Level
At business level, Anderson and Joglekar (2005) stated that all businesses enterprises can be
classified under certain organizations that work within certain industries. These businesses develop
strategies which work at their level and that which reflect their current position and the amount of
resources they have or need in respect to the competitive environment they are operating. As a matter
of fact, competition at this level can either be price competition or a unique selling point. Through this
level, Gustavsson (2008) indicates that a business can demonstrate its uniqueness through product or
service provision which it can also use to command higher margins.
3. Business Level
At business level, Anderson and Joglekar (2005) stated that all businesses enterprises can be
classified under certain organizations that work within certain industries. These businesses develop
strategies which work at their level and that which reflect their current position and the amount of
resources they have or need in respect to the competitive environment they are operating. As a matter
of fact, competition at this level can either be price competition or a unique selling point. Through this
level, Gustavsson (2008) indicates that a business can demonstrate its uniqueness through product or
service provision which it can also use to command higher margins.
Types of Plans
2. Tactical Plan – describes the tactics the organization plans to use to achieve the ambitions outlined in
the strategic plan. It is a short range, say less than one year, a low-level document that breaks own
broader mission statements into smaller, actionable chunks.
3. Operational Plan – the operational plan describes the day to day running of the company. The
operational plan charts out a road map to achieve the tactical goals within the timeframe. This plan is
highly specific with an emphasis on short-term objectives.
Creating the operational plan is the responsibility of the low-level managers and supervisors. An
operational plan can be either single or ongoing:
• Single Use Plans – created or events/ activities with a single occurrence, such as sales rally, marketing
campaign, and recruitment drive, etc. single use plans tend to be highly specific.
• Ongoing Plans – These plans can be used in multiple settings on an ongoing basis. It could be a policy,
set of rules or procedures. Ongoing plans can be changed
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4. Contingency Plan - Contingency plans are prepared when something unforeseen occurs or when
something needs to be modified. Business experts sometimes refer to these plans as a special type of
planning.
Contingency planning can be beneficial in situations that call for a change. Although managers should
foresee changes when engaged in any of the primary types of planning, contingency planning is
important in moments when changes can’t be predicted. As the business world turn out to be more
complex, contingency planning becomes more crucial to engage in and understand.
Planning at different Levels in the Firm
An organization can have many different managers, across different levels, positions, levels of authority
and hierarchy. In any organization, managers are on top of their subordinates. They carry our plans
through the support of their staffs. Here we will discuss planning at different levels in the firm.
Most organizations have three management levels:
• Top-level managers
• Middle-level managers
• Low-level managers
Top- Level Managers
• Part of the succession planning for high potential management trainees.
• Set goals and lead the entire company to achieve the goals set.
Middle-level Managers
• Execute organizational plans in conformance with the company policies and objectives
• Define and discuss information from top management to lower management and motivate/ guides
low-level managers towards better performance.
• Implement effective group intergroup work and information systems
Lower-level Managers
• Focus on controlling and directing
• Responsible for the daily management of line workers of the employees
• Supervise and monitor daily activities to ensure quality of work and production
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