Question

(a) State any four characteristics of planning.
OR
(b) Explain the following types of plans:
(i) Policy
(ii) Budget

Hint:

Planning lays the foundation for all managerial activities and prepares organisations for the future.

Answer 1

(a) Characteristics of Planning:
1. Focuses on Achieving Objectives:
Planning begins with the determination of objectives. It lays down the means to achieve them and acts as a guide for action in future activities. All business plans are directed towards goals.
Example: A firm may plan to increase market share by 10% within one year.
2. Primary Function of Management:
Planning is the first function performed by every manager. All other functions like organising, staffing, directing, and controlling follow planning. Without planning, no other function can be executed effectively.
3. Pervasive Function:
Planning is required at all levels of management and in all departments of the organisation. Top-level plans are strategic, middle-level plans are tactical, and lower-level plans are operational.
4. Futuristic:
Planning is forward-looking as it is done for the future. It involves forecasting and anticipating future events. Successful planning requires a vision of future scenarios.
OR
(b) Types of Plans:
(i) Policy:
A policy is a general guideline that helps in decision-making and sets the boundaries within which decisions can be made. Policies reflect the philosophy of the organisation and ensure consistency in managerial actions.
Example: A company policy to replace any defective product within 7 days.
(ii) Budget:
A budget is a plan that is expressed in numerical terms. It could be financial or related to labour hours, production units, etc. Budgets are used to allocate resources and act as benchmarks for evaluating performance.
Example: A marketing budget of Rs. 5 lakh for the quarter.
Final Answer:
(a) Characteristics: Focus on objectives, Primary function, Pervasive, Futuristic
(b) Types: Policy and Budget