Business Studies 6 Marks Question

The different types of plans are:

1. Objective: 'One of his objectives was to earn 50% profit on the amount invested in the first year.'

An objective is the end which the management seeks to achieve within a given time period.

2. Policy: 'It was decided that raw materials like.I1our, sugar, salt, etc. will be purchased on two-month credit.'

Policy is a general guideline which brings uniformity in decision making for achievement of predetermined objectives.

3. Procedure: 'He also decided to follow the steps required for marketing the products through his own outlets.'

Alternate Answer

'He appointed Harsh as aProduction Manager who decided the exact manner in which the production activities are to be carried out.'

It consists of sequence of routine steps on how to carry out activities. It details the exact manner in which any work is to be performed.

4. Budget: 'Harsh also prepared a statement showing the requirement of workers in the fact throughout the year.'

Alternate Answer

'Mayank informed Harsh about his sales target for the event products, area wise the fourth coming quarter.'

A budget is plan which states expected results of a given future period in numerical terms. It may be expressed in time, money or physical units.

5. Rule: 'While working on the production table, a penalty of day was announced for not wearing the helmet, gloves and apron by the workers.'

A rule is a statement that specifies what is to be done or not to be done.

Planning refers to setting objectives for a given time period, formulating various courses of action to achieve them and then selecting the best possible alternative from among the various courses of action available.Alternate answer
Definition: Planning is deciding in advance what to do and how to do. It is one of the basic managerial functions. Planning therefore involves setting objectives and developing an appropriate course of action to achieve these objectives.Importance of planning:

1. Planning provides directions: By stating in advance how work is to be done planning provides direction for action. Planning ensures that the goals or objectives are clearly stated so that they act as a guide for deciding what action should be taken and in which direction. If goals are well defined, employees are ware of what the organisation has to do and what they must do to achieve those goals. Departments and individuals in the organization are able to work in coordination.If there was no planning, employees would be working in different directions and the organization would not be able to achieve its desired goals.
2. Planning reduces the risks of uncertainty: Planning is an activity which enables a manager to look ahead and anticipate changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or events cannot be eliminated but they can be anticipated and managerial responses to them can be developed.
3. Planning facilitates decision making: Planning helps the manager to look into the future and make a choice from amongst various alternative courses of action. The manager has to evaluate each alternative and select the most viable proposition. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.
4. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated. It is easier to detect inefficiencies and take corrective measures to deal with them.

Planning anticipates what is to be done and how it is to be done. It is an essential activity that provides the rationale for undertaking policies with the aim of achieving goals.The following are the features of planning:

1. Objective-oriented: Planning serves the guidelines for the goals to be achieved. It also defines how these goals are to be achieved. These guidelines ensure that the objectives of an organisation are achieved on time. For this, the management formulates plans keeping in mind specific goals and the managers make sure that the plans are purposeful. For example, if a sales target is to be achieved, then the organisational plans must reflect this objective.
2. Stepping stone: Planning serves as the stepping stone for other functions of an organisation. It precedes other functions such as organising, directing, staffing and controlling. This is because plans state the objectives of an organisation along with the means to achieve them. Other functions are planned in accordance with the objectives. Once the plans are determined, the roles of other interrelated functions fall into place. Thus, planning sets the basis for the other functions of management.
3. Pervasive: Planning is a function that needs to be performed at all levels in an organisation. It is performed not just by the top-level managers but also by the people at the low level of management. However, its scope differs according to the various dimensions of business. For example, the top-level managers have to chalk out policies regarding the overall management, the middle-level managers plan the authority to be assigned to their subordinates and the low-level managers set smaller targets for the day-to-day functioning of the organisation.
4. Continuous: Planning is a continuous process. This is because, after the implementation of one plan, the need arises for formulating the next plan, keeping in view the new objectives and circumstances. Moreover, within a plan period, the need arises to modify the plan as per changing needs and requirements.
5. Choice-making: Planning is a process of making choices from the various alternatives to achieve the desired goals. These alternatives are related to the strategies or policies for achieving organisational objectives. Managers need to evaluate these choices thoroughly and select the most rational scheme to achieve objectives.

Limitations of planning:

1. Planning leads to rigidity: In an organisation, a well-defined plan is drawn up with specific goals to be achieved within a specific time frame. These plans then decide the future course of action and managers may not be in a position to change it. This kind of rigidity in plans may create difficulty. Managers need to be given some flexibility to be able to cope with the changed circumstances.
2. Planning may not work in a dynamic environment: The business environment is dynamic, nothing is constant. The environment consists of a number of dimensions, economic, political, physical, legal and social dimensions. The organization has to constantly adapt itself to changes. It becomes difficult to accurately assess future trends in the environment if economic policies are modified or political conditions in the country are not stable or there is a natural calamity.
3. Planning reduces creativity: Planning is an activity which is done by the top management. Usually the rest of the members just implements these plans. As a consequence, middle management and other decision makers are neither allowed to deviate from plans nor are they permitted to act on their own. Thus, much of the initiative or creativity inherent in them also gets lost or reduced.
4. Planning is a time-consuming process: Sometimes plans to be drawn up take so much of time that there is not much time left for their implementation.
5. Planning does not guarantee success: The success of an enterprise is possible only when plans are properly drawn up and implemented. Any plan needs to be translated into action or it becomes meaningless. Managers have a tendency to rely on previously tried and tested successful plans.

Importance of planning:

1. Planning provides directions: By stating in advance how work is to be done planning provides direction for action. Planning ensures that the goals or objectives are clearly stated so that they act as a guide for deciding what action should be taken and in which direction. If goals are well defined, employees are ware of what the organisation has to do and what they must do to achieve those goals. Departments and individuals in the organization are able to work in coordination.If there was no planning, employees would be working in different directions and the organization would not be able to achieve its desired goals.
2. Planning reduces the risks of uncertainty: Planning is an activity which enables a manager to look ahead and anticipate changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or events cannot be eliminated but they can be anticipated and managerial responses to them can be developed.
3. Planning facilitates decision making: Planning helps the manager to look into the future and make a choice from amongst various alternative courses of action. The manager has to evaluate each alternative and select the most viable proposition. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.
4. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated. It is easier to detect inefficiencies and take corrective measures to deal with them.
5. Planning promotes innovative ideas: Since planning is the first function of management, new ideas can take the shape of concrete plans. It is the most challenging activity for the management as it guides all future actions leading to growth and prosperity of the business.

Planning is necessary for effective management because of the following reasons:(Importance of planning)

1. Focuses on objectives: Organisations are set up with a general purpose in view. Specific goals are set out in the plans along with the activities to be undertaken to achieve the goals. Thus, planning is purposeful. Planning has no meaning unless it contributes to the achievement of predetermined organisational goals.
2. Planning provides directions: By stating in advance how work is to be done planning provides direction for action. Planning ensures that the goals or objectives are clearly stated so that they act as a guide for deciding what action should be taken and in which direction. If goals are well defined, employees are ware of what the organisation has to do and what they must do to achieve those goals. Departments and individuals in the organization are able to work in coordination.If there was no planning, employees would be working in different directions and the organization would not be able to achieve its desired goals.
3. Planning reduces the risks of uncertainty: Planning is an activity which enables a manager to look ahead and anticipate changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or events cannot be eliminated but they can be anticipated and managerial responses to them can be developed.
4. Planning facilitates decision making: Planning helps the manager to look into the future and make a choice from amongst various alternative courses of action. The manager has to evaluate each alternative and select the most viable proposition. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.
5. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated. It is easier to detect inefficiencies and take corrective measures to deal with them.

Yes, planning has limitations -Limitations of planning are:

1. Planning may not work in a dynamic environment: The,business environment is dynamic, nothing is constant. The environment consists of a number of dimensions, economic, political, physical, legal and social dimensions. The organization has to constantly adapt itself to changes.
2. Planning reduces creativity: Planning is an activity which is done by the top management. Usually the rest of the members just implements these plans. As a consequence, middle management and other decision makers are neither allowed to deviate from plans nor are they permitted to act on their own. Thus, much of the initiative or creativity inherent in them also gets lost or reduced.
3. Planning is a time-consuming process: Sometimes plans to be drawn up take so much of time that there is not much time left for their implementation.
4. Planning involves huge costs: When plans are drawn up huge costs are involved in their formulation. These may be in terms of time and money for example, checking accuracy of facts may involve lot of time. Detailed plans require scientific calculations to ascertain facts and figures. The costs incurred sometimes may not justify the benefits derived from the plans. There are a number of incidental costs as well, like expenses on boardroom meetings, discussions with professional experts and preliminary investigations to find out the viability of the plan.
5. Planning leads to rigidity: In an organisation, a well-defined plan is drawn up with specific goals to be achieved within a specific time frame. These plans then decide the future course of action and managers may not be in a position to change it. This kind of rigidity in plans may create difficulty.

Importance of Planning:Definition: Planning is deciding in advance what to do and how to do. It is one of the basic managerial functions.
Planning therefore involves setting objectives and developing an appropriate course of action to achieve these objectives.
Importance of planning:

1. Planning provides directions: By stating in advance how work is to be done planning provides direction for action. Planning ensures that the goals or objectives are clearly stated so that they act as a guide for deciding what action should be taken and in which direction. If goals are well defined, employees are ware of what the organisation has to do and what they must do to achieve those goals. Departments and individuals in the organization are able to work in coordination.If there was no planning, employees would be working in different directions and the organization would not be able to achieve its desired goals
2. Planning reduces the risks of uncertainty: Planning is an activity which enables a manager to look ahead and anticipate changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or events cannot be eliminated but they can be anticipated and managerial responses to them can be developed.
3. Planning facilitates decision making: Planning helps the manager to look into the future and make a choice from amongst various alternative courses of action. The manager has to evaluate each alternative and select the most viable proposition. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.
4. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated. It is easier to detect inefficiencies and take corrective measures to deal with them.
5. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated.
6. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated.

1. Setting Objectives: The first and foremost step is setting objectives. Every organization must have certain objectives. Objectives may be set for the entire organisation and each department or unit within the organisation. Objectives or goals specify what the organization wants to achieve.
2. Developing Premises: Planning is concerned with the future which is uncertain and every planner is using conjecture about what might happen in future. Therefore, the manager is required to make certain assumptions about the future. These assumptions are called premises. Assumptions are the base material upon which plans are to be drawn. The base material may be in the form of forecasts, existing plans or any past information about policies.
3. Identifying alternative courses of action: Once objectives are set, assumptions are made. Then the next step would be to act upon them. There may be many ways to act and achieve objectives. All the alternative courses of action should be identified. The course of action which may be taken could be either routine or innovative. Evaluating alternative courses: The next step is to weigh the pros and cons of each alternative. Each

Course will have many variables which have to be weighed against each other. The positive and negative aspects of each proposal need to be evaluated in the light of the objective to be achieved. In financial plans.

4. Selecting an alternative: This is the real point of decision making. The best plan has to be adopted and implemented. The ideal plan, of course, would be the most feasible, profitable and with least negative consequences. Most plans may not always be subjected to a mathematical analysis. In such cases, subjectivity and the manager’s experience, judgement and at times, intuition play an important part in selecting the most viable alternative.
5. Implementing the plan: This is the step where other managerial functions also come into the picture. The step is concerned with putting the plan into action, i.e., doing what is required. For example, if there is a plan to increase production then more labour, more machinery will be required. This step would also involve organising for labour and purchase of machinery.
6. Follow-up action: To see whether plans are being implemented and activities are performed according to schedule is also part of the planning process. Monitoring the plans is equally important to ensure that objectives are achieved.

The different types of plans are:

1. Objective: ‘One of his objectives was to earn 80% profit on the amount invested in the first year.’

An objective is the end which the management seeks to achieve within a given time period.

2. Policy ‘It was decided that raw materials like cloth, thread, buttons etc. will be purchased on two months credit.’

3. Procedure: ‘He also decided to follow the steps required for marketing the products through his own outlets.’

Alterate Answer

‘He appointed Ritesh as a production manager, who decides the exact manner in which the production activities are to be carried out.’

It consists of sequence of routine steps on how to carry out activities. It details the exact manner in which any work is to be performed.

4. Budget: ‘Ritesh also prepared a statement showing the requirement of workers in the factory throughout the year.‘

Alternate Answer

‘Nishant informed Ritesh about his sales target for different products areawise for the forthcoming quarter.’

A budget is plan which states expected results of a given future period in numerical terms. It may be expressed in time, money or physical units.

5. Rule: ‘A penalty of ₹ 200 per day was announced for the workers who found smoking in the factory premises.’

A rule is a statement that specifies what is to be done or not to be done.

The different types of plans are:

1. Objective: 'One of her objectives is to earn 10% profit on the amount invested in the first year.'

An objective is the end which the management seeks to achieve within a given time period.

2. Policy: 'It was decided that raw materials like fruits, vegetables, spices, etc. will be purchased on three months credit from farmers cultivating organic crops only.'

Policy is a general guideline which brings uniformity in decision making for achievement of predetermined objectives.

3. Procedure: 'She also decided to follow the steps required for marketing of the products through her own outlets.'

Alternate Answer

'She appointed Mohan as a Production Manager who decides the exact manner in which the production activities are to be carried out.'

It consists of sequence of routine steps on how to carry out activities. It details the exact manner in which any work is to be performed.

4. Budget: 'Mohan also prepared a statement showing the number of workers that will be required in the factory throughout the year.'

Alternate Answer

'Madhu informed Mohan about the sales target for different products, area wise for the forthcoming quarter'.

A budget is a plan which states expected results of a given future period in numerical terms. It may be expressed in time, money or physical units.

5. Rule: 'While working on the production table, a penalty of Rs. 100 per day for not wearing the caps, gloves and aprons was announced'.

A rule is a statement that specifies what is to be done or not to be done.

Planning is needed both in the business and non-business organizations. Some people think that planning is based on the future anticipations and nothing can be said with certainty about future. Therefore, it is a useless process. In fact, these people point towards the difficulties in the way of planning. If planning has to be successful and purposeful, the managers should be aware of these difficulties and limitations of planning.Following are the limitations of planning:

1. Planning Creates Rigidity: Although the quality of flexibility is inherent in planning, meaning thereby that in case of need changes can be brought in, but it must be admitted that only small changes are possible. Big changes are neither possible nor in the interest of the organisation. Since it is not possible to introduce desired changes according to the changed situations, the organisation loses many chances of earning profits. For this limited flexibility in planning, both the internal as well as external factors are responsible. These facts are called internal and external inflexibility.

They are the following:

1. Internal Inflexibility: At the time of planning the objectives of the organisation, its policies, procedures, rules, programmes, etc. are determined. It is very difficult to bring in changes time and again. It is known as internal inflexibility,
2. External Inflexibility: External inflexibility means various external factors that cause limited flexibility in planning. These factors are beyond the control of the planners. The chief among them are: political climate, economic changes, technical changes, natural calamities, policies of the competitors, etc.

For example, in political context, as a result of change, a new government brings up a new trade policy, policy of taxation, import policy, etc. All these changes make every sort of planning a meaningless waste. Similarly, a change in the policies of the competitors suddenly makes all types of planning ineffective.

2. Planning Does Not Work in a Dynamic Environment: Planning is based on the anticipation of future happenings. Since future is uncertain and dynamic, therefore, the future anticipations are not always true. Therefore, to consider planning as the basis of success is like a leap in the dark.

Generally, a longer period of planning makes it less effective. Therefore, it can be said that planning does not work in dynamic environment.
For example, a company anticipated that the government was thinking about allowing the export of some particular product. With this hope the same company started manufacturing that product. But the government did not allow the export of this product. In this way, the wrong anticipation proved all planning wrong or incorrect. It brought loss instead of profit.

3. Planning Reduces Creativity: Under planning all the activities connected with the attainment of objectives of the organisation are pre-determined. Consequently, everybody works as they have been directed to do and as it has been made clear in the plans.

Therefore, it checks their incisiveness. It means that they do not think about appropriate ways of discovering new alternatives. According to Terry, “Planning strangulates the initiative of the employees and compels them to work in an inflexible manner.”

4. Planning Involves Huge Costs: Planning is a small work but its process is really big. Planning becomes meaningful only after traversing a long path. It takes a lot of time to cover this path.

During this entire period the managers remain busy in collecting a lot of information and analysing it. In this way, when so many people remain busy in the same activity, the organisation is bound to face huge costs.

4. Planning is a Time-consuming Process: Planning is a blessing in facing a definite situation but because of its long process it cannot face sudden emergencies. Sudden emergencies can be in the form of some unforeseen problem or some opportunity of profits and there has been no planning for all these situations beforehand and which now requires immediate decision.

In such a situation, if the manager thinks of completing the planning process before taking some decision, it may be possible that the situations may worsen or the chance of earning profit may slip away. Thus, planning is time consuming and it delays action.

6. Planning Does Not Guarantee Success: Sometimes the managers think that planning solves all their problems. Such thinking makes them neglect their real work and the adverse effect of such an attitude has to be faced by the organisation.

In this way, planning offers the managers a false sense of security and makes them careless. Hence, we can say that mere planning does not ensure success; rather efforts have to be made for it.

1. Planning provides directions: By stating in advance how work is to be done planning provides direction for action. Planning ensures that the goals or objectives are clearly stated so that they act as a guide for deciding what action should be taken and in which direction. If goals are well defined, employees are ware of what the organisation has to do and what they must do to achieve those goals. Departments and individuals in the organization are able to work in coordination.If there was no planning, employees would be working in different directions and the organization would not be able to achieve its desired goals.
2. Planning reduces the risks of uncertainty: Planning is an activity which enables a manager to look ahead and anticipate changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or events cannot be eliminated but they can be anticipated and managerial responses to them can be developed.
3. Planning facilitates decision making: Planning helps the manager to look into the future and make a choice from amongst various alternative courses of action. The manager has to evaluate each alternative and select the most viable proposition. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.
4. Planning reduces overlapping and wasteful activities: Planning serves as the basis of coordinating the activities and efforts of different divisions, departments and individuals. It helps in avoiding confusion and misunderstanding. Since planning ensures clarity in thought and action, work is carried on smoothly without interruptions. Useless and redundant activities are minimised or eliminated. It is easier to detect inefficiencies and take corrective measures to deal with them.
5. Planning promotes innovative ideas: Since planning is the first function of management, new ideas can take the shape of concrete plans. It is the most challenging activity for the management as it guides all future actions leading to growth and prosperity of the business.

1. Planning leads to rigidity: In an organisation, a well-defined plan is drawn up with specific goals to be achieved within a specific time frame. These plans then decide the future course of action and managers may not be in a position to change it. This kind of rigidity in plans may create difficulty.
2. Planning may not work in a dynamic environment: The,business environment is dynamic, nothing is constant. The environment consists of a number of dimensions, economic, political, physical, legal and social dimensions. The organization has to constantly adapt itself to changes.
3. Planning reduces creativity: Planning is an activity which is done by the top management. Usually the rest of the members just implements these plans. As a consequence, middle management and other decision makers are neither allowed to deviate from plans nor are they permitted to act on their own.
4. Planning involves huge costs: When plans are drawn up huge costs are involved in their formulation. These may be in terms of time and money for example, checking accuracy of facts may involve lot of time.
5. Planning is a time-consuming process: Sometimes plans to be drawn up take so much of time that there is not much time left for their implementation.

Features of planning:

1. Planning focuses on achieving objectives: Organisations are set up with a general purpose in view. Specific goals are set out in the plans along with the activities to be undertaken to achieve the goals.
2. Planning is a primary function of management: Planning lays down the base for other functions of management. All other managerial functions are performed within the framework of the plans drawn. Thus, planning precedes other functions.
3. Planning is continuous: Plans are prepared for a specific period of time, may be for a month, a quarter, or a year. At the end of that period there is need for a new plan to be drawn on the basis of new requirements and future conditions.
4. Planning is futuristic: Planning essentially involves looking ahead and preparing for the future. The purpose of planning is to meet future events effectively to the best advantage of an organisation. It implies peeping into the future, analysing it and predicting it.
5. Planning involves decision making: Planning essentially involves choice from among various alternatives and activities. If there is only one possible goal or a possible course of action, there is no need for planning because there is no choice. The need for planning arises only when alternatives are available.

Planning is necessary because of future uncertainty and change. One cannot be certain about future events. However, by forcing managers to look ahead, anticipate change, consider the impact of change, and develop appropriate responses, planning reduces uncertainty. Longer the period of planning greater is the possibility of such uncertainties.

Features of planning:

1. Planning provides directions: By stating in advance how work is to be done planning provides direction for action. Planning ensures that the goals or objectives are clearly stated so that they act as a guide for deciding what action should be taken and in which direction. If goals are well defined, employees are ware of what the organisation has to do and what they must do to achieve those goals. Departments and individuals in the organization are able to work in coordination.If there was no planning, employees would be working in different directions and the organization would not be able to achieve its desired goals
2. Planning reduces the risks of uncertainty: Planning is an activity which enables a manager to look ahead and anticipate changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or events cannot be eliminated but they can be anticipated and managerial responses to them can be developed.
3. Planning facilitates decision making: Planning helps the manager to look into the future and make a choice from amongst various alternative courses of action. The manager has to evaluate each alternative and select the most viable proposition. Planning involves setting targets and predicting future conditions, thus helping in taking rational decisions.
4. Planning is a mental exercise: Planning requires application of the mind involving foresight, intelligent imagination and sound judgement. It is basically an intellectual activity of thinking rather than doing, because planning determines the action to be taken. However, planning requires logical and systematic thinking rather than guess work or wishful thinking.
5. Planning is futuristic: Planning essentially involves looking ahead and preparing for the future. The purpose of planning is to meet future events effectively to the best advantage of an organisation. It implies peeping into the future, analysing it and predicting it. Planning is, therefore, regarded as a forward looking function based on forecasting. Through forecasting, future events and conditions are anticipated and plans are drawn accordingly.
6. Planning is continuous: Plans are prepared for a specific period of time, may be for a month, a quarter, or a year. At the end of that period there is need for a new plan to be drawn on the basis of new requirements and future conditions. Hence, planning is a continuous process. Continuity of planning is related with the planning cycle.

Rules - Rules are specific statements to guide the behaviour and leave no scope for discretion.Methods - Methods are standardised ways of performing routine and repetitive jobs. They reduce confusions and bring efficiency and economy in operations.
Differences:

Basis	Rules	Methods
Meaning	Guidelines to behaviour.	Guidelines stating the way of accomplishing the jobs.
Purpose	Ensures discipline.	Increases efficiency of operations.
Effect of violation	Penalty attached to violation.	No penalty for violation.
Relation	Relates to behaviour of human beings.	Relates to physical and other tasks.
Flexibility	Generally rigid statement.	Flexible statements for guiding and controlling operations.

The different types of plans being used by Flipkart are listed below:

1. Objectives: Objectives are the end results of the activities that an organisation seeks to achieve through its existence. All other activities within the organisation are directed towards achieving these objectives.
   “The company seeks to increase traffic (more clicks on their products) and boost sales and revenue through integration of Mobile Apps, Display, Pay Per Click and Search Engine Optimization.”
2. Strategy: A strategy is a comprehensive plan for achieving the objectives of the organisation. This comprehensive plan involves:
   • determining long term objectives
   • adopting a particular course of action
   • allocating resources necessary to achieve the objective.
     “In order to dispel the fear of people related to shopping online, Flipkart was the first company to implement the popular ‘Cash On Delivery’ facility.”
3. Policy: A policy is a siet of general guidelines that help in managerial decision making and action.
   “All the products sold by the company under a particular category may have different return/replacement period.”
4. Method: A method refers to the prescribed ways or manner in which a task has to be performed considering the objective.
   “Flipkart allows multiple payment options such as cash on delivery, credit or debit card transactions, net banking, e-gift voucher and card swipe on delivery.”
5. Procedure: A procedure contains a series of specific steps to be performed in a chronological order to carry out the routine activities.
   “The company operates both ways when an order is received. The products for which it holds inventory are dispatched by it directly. For the products they do not store in inventory, they just send the order received by them to the supplier who ships it.”
6. Budget: A budget refers to a financial plan that is expressed in -numerical terms.
   “The company plans to spend about ? 75 crores on e-commerce advertising in the year 2016.”
7. Rule: A rule is a specific statement relating to the general norms in terms of Do’s and Don’ts that guide the behaviour of people. It commands strict obedience and a penalty is likely to be imposed on its violation.
   “Flipkart reserves the right to terminate your membership and/or refuse to provide you with access to the Website if it is brought to Flipkart’s notice or if it is discovered that you are under the age of 18 years. This is because as per the Indian Contract Act, 1872, the minors, un-discharged insolvents etc. are not eligible to use the Website.”

Kanu will be able to achieve the desired results by following steps involved in the process of planning.
Steps involved in the process of planning are as follows :
(i) Setting objectives The first and foremost step is setting objective. Every organisation must have certain objectives. Objectives may be set for the entire organisation or for each department or unit with in the organisation. Objectives or goals specify what the organisation wants to achieve. It could mean an increase in sales by 20% which could be an objective of the entire organisation.
(ii) Developing premises Premises refers to making assumptions regarding future. Premises are the base on which plans are made. It is a kind of forecast, made keeping in view existing plans and any past information about various policies. There should be total agreement on all these assumptions.
(iii) Identifying alternative courses of action After the setting up of objectives, the managers make a list of alternatives through which the organisation can achieve its objectives as there can be many ways to achieve the objectives and managers must know all those ways to reach these objectives.
(iv) Evaluating alternative courses After making the list of various alternatives along with the assumptions supporting them, the manager starts evaluating each and every alternative and note down the positive and negative aspects of each alternative. After this ,the manager starts eliminating the negative aspects and the one with maximum positive aspects is selected as best alternative.
(v) Selecting an alternative This is the real point of decision-making. The best plan has to be adopted and implemented. The ideal plan, of course, would be the most feasible, profitable and with least negative consequences. After preparing the main plan, the organisation has to make number of small plans to support the main plan.
(vi) Implementing the plan This is the step where other managerial functions also come into the picture. This step is concerned with putting the plan into action, i.e. doing what is required, e.g. if there is a plan to increase production then more labour and more machinery will be required. This step would also involve organising labour and purchase of machinery.
(vii) Follow-up action To see whether plans are being implemented and activities are performed according to schedule, is also part of the planning process. Monitoring the plans is equally important to ensure that objectives are achieved properly.

The meaning of 'strategy' and 'rule' as types of plans are given below:

1. Strategy A strategy is a comprehensive plan to achieve the organisational objectives. The dimensions of strategy are:

1. Determining long-term objective.
2. Adopting a particular course of action.
3. Allocating resources for achieving the objectives.
4. Strategy is formulated after scanning the business environment.

2. Rules These are specific statements that inform what is to be done. They do not allow any flexibility or discretion. It reflects a managerial decision that a certain action must or must not be taken. Rules generally refer to the administrative area of the procedure. They serve as guides and do not leave any scope for discretion.

Following are the types of plans:

1. Objectives: Objectives are those end points for the attainment of which all the activities are undertaken. It is a special target to be achieved by an organisation, e.g., it can be the objective of a school to impart education in the subject of commerce to 100 students during an year.
2. Strategy: It refers to a plan which takes into account the environmental opportunities and threats and the organisational strengths and weaknesses and provides an optimal match between the organisation and the environment.
3. Policies: Policies are those general statements which are decided for the guidance of the employees while taking decision. Like Personnel Policy: Under this policy it can be decided that the basis for the promotion of employees will be their age. Once this is decided, no departmental manager will need the permission of the General Manager regarding the promotion of the employees.
4. Procedures: Procedures are those plans which determine the sequence of any work performance. For example, the recovery of money from the debtors can be done in the following order:

1. Writing letters.
2. Contacting on telephone.
3. Meeting personally.
4. Taking legal action.

5. Methods: Method is that plan which determines how different activities of the procedure are completed. A method is not related to all steps but only to one step of the procedure. It is more detailed than procedure. There may be many methods to do a particular work. After extensive study, a method has to be selected from which a worker feels minimum fatigue, increase in productivity and there is reduction in costs.

Following are the limitations of planning:

1. Planning Creates Rigidity: Although the quality of flexibility is inherent in planning, but it must be admitted that only small changes are possible. Big changes are neither possible nor in the interest of the organisation. Since it is not possible to introduce desired changes according to the changed situations, the organisation loses many chances of earning profits.
2. Planning does not work in a Dynamic Environment: Planning is based on the anticipation of future happenings. Since future is uncertain and dynamic, therefore, the future anticipations are not always true. Therefore, it can be said that planning does not work in dynamic environment.
3. Planning Reduces Creativity: Under planning all the activities connected with the attainment of objectives of the organisation are pre-determined. Consequently, everybody works as they have been directed to do and as it has been made clear in the plans. Therefore, it checks their incisiveness. It means that they do not think about appropriate ways of discovering new alternatives.
4. Planning Involves Huge Costs: Planning is a small work but its process is really big. Planning becomes meaningful only after traversing a long path. It takes a lot of time to cover this path. During this entire period the managers remain busy in collecting a lot of information and analysing it. In this way, when so many people remain busy in the same activity, the organisation is bound to face huge costs.
5. Planning is a Time Consuming Process: Planning is a blessing in facing a definite situation but because of its long process it cannot face sudden emergencies. In such a situation, if the manager thinks of completing the planning process before taking some decision, it may be possible that the situations may worsen or the chance of earning profit may slip away. Thus, planning is time consuming and it delays action.

Advantages of Planning:

1. Planning provides Direction: Under the process of planning the objectives of the organisation are defined in simple and clear words. The obvious outcome of this is that all the employees get a direction and all their efforts are focussed towards a particular end. In this way, planning has an important role in the attainment of the objectives of the organisation.
2. Planning reduces Risks of Uncertainty: Planning is always done for future and future is uncertain. With the help of planning, possible changes in future are anticipated and various activities are planned in the best possible way. In this way, the risk of future uncertainties can be minimised.
3. Planning reduces Overlapping and Wasteful Activities: Under planning, future activities are planned in order to achieve objectives. Consequently, the problems of when, where, what and why are almost decided. This puts an end to disorder and suspicion. In such a situation coordination is established among different activities and departments. It puts an end to overlapping and wasteful activities.

Limitations of Planning:

1. Planning Creates Rigidity: Although the quality of flexibility is inherent in planning, but it must be admitted that only small changes are possible. Big changes are neither possible nor in the interest of the organisation. Since it is not possible to introduce desired changes according to the changed situations, the organisation loses many chances of earning profits.
2. Planning does not work in a Dynamic Environment: Planning is based on the anticipation of future happenings. Since future is uncertain and dynamic, therefore, the future anticipations are not always true. Therefore, it can be said that planning does not work in dynamic environment.

Following are the features of planning:

1. Planning focuses on Achieving Objectives: Management begins with planning and planning begins with the determining of objectives. In the absence of objectives no organisation can ever be thought about. With the determining of objective, the way to achieve the objective is decided in the planning. It is thus clear that planning is helpful in the attainment of objectives.
2. Planning is Primary Function of Management: Planning is the first important function of management. The other functions, e.g., organising, staffing, directing and controlling come later. In the absense of planning no other function of management can be performed. This is the base of other functions of management.
3. Planning is Pervasive: Since the job of planning is performed by the managers at different levels working in the enterprise, it is appropriate to call it all pervasive. Planning is an important function of every manager, he may be a managing director of the organisation or a foreman in a factory.
4. Planning is Continuous: Planning is a continuous process because:

1. A plan is prepared for a particular period. Hence, there is need for a new plan after the expiry of that period.
2. In case of any discrepancy plans are to be revised.
3. In case of rapid changes in the business environment plans are to be revised.

5. Planning is Futuristic: Planning decides the plan of action-what is to be done, how is it to be done, when is it to be done, by whom is it to be done, all these questions are related to future. Under planning, answers to these questions are found out. While an effort is made to find out these answers, the possibility of social, economic, technical and changes in legal framework are kept in mind. Since planning is concerned with future activities, it is called futuristic.

Difference between rule and method Basis Rule Method:

S. No.	Basis	Rule	Method
1.	Meaning	A specific guideline to behaviour.	One best way of doing work.
2.	Purpose	To maintain discipline and order.	To maximise efficiency and economy.
3.	Source	Result of managerial thinking and values	Result of research and experimentation.
4.	Adherence	Calls for strict adherence and self-control.	Calls for standardisation and simplification.
5.	Penalty	No tolerance limits penalty is imposed for violation.	Tolerance limits laid down for deviations from the standard method.

Organisations are not always able to accomplish all their objectives due to the following reasons:

1. Planning Leads to Rigidity: In an organisation a well defined plan is drawn up with specific goals to be achieved, with in a specific time frame. These plans then decide how the work will progress in the future and managers may not be in a position to change it. This creates a problem as flexibility is very important. Always adhering to the plan may not give us the desired results always.
2. Planning May not Work in a Dynamic Environment: The business environment is dynamic, nothing is constant. The business environment is a totality of external forces, where in some changes or the other keep on taking place. Plans decide in advance what has to be done in future. Planning cannot foresee everything and thus there may be obstacles to effective planning.
3. Planning Reduces Creativity: Planning is generally done by the top management. Usually the rest of the members just implements these plans. As a consequence, middle management and other decisions makers are neither allowed to deviate from plans nor are they permitted to act on their own, thus planning in a way reduces creativity since people tend to think along the same lines as others, there is nothing new or innovative.
4. Planning Involves Huge Cost: Planning involves huge cost in their formulation. These may be in terms of time and money. The costs incurred sometimes may not justify the benefits derived from the plans.
5. Planning is a Time Consuming Process: Sometimes plans to be drawn take up so much of time that there is not much time left for their implementation and the objectives to be achieved.
6. Planning does not Guarantee Success Any plans needs to be translated into action or it becomes meaningless. Managers have a tendency to rely on previously tried and tested successful plans. It is not always true that just because a plan has worked before it will work again.

Planning involves huge costs in terms of time and money. It involves analysis, research and scientific calculations that involve huge cost. However, despite being an expensive function it is a very basic and essential function of an organisation. Following are some of the highlighted factors due to which we can say that planning is a very significant action despite of the gigantic costs.

1. Renders Direction: Planning clearly states the goals and objectives to be achieved. Thus, it acts as a guide for the actions to be taken. It provides a direction to the actions of different departments of the organisation. They guide the managers about things to be done, what route to take and how the objectives are to be achieved. It ensures that the path taken for accomplishment of goals is righteously chosen. Planning also ensures that various departments of the organisation work in a coordinated manner towards the achievement of the desired objectives.
2. Subdued Risk: By guiding an organisation in the right direction, it accredits its managers to analyse and anticipate changes. This leads to a reduction in uncertainty of the foreseen events. Planning shows how to deal with situations which may arise in the due course of management, though it does not fully eliminate the problems.
3. Minimised Overlapping: As the managers are well comprehended with the policies and plans of the organisation, they coordinate the activities together to reach the objectives. Thus, overlapping of the work is reduced. Also any wastage of resources that takes place due to repeatedness is reduced. Proper planning ensures that there is no confusion and misunderstanding and the work proceeds smoothly.
4. Encourages Creativity: Planning serves as the stepping stone of any organisation's success. It includes formulating policies and plans which requires innovation. It is a crucial activity which demands the best of managers thinking capabilities and creativity. It calls out for new ideas by the management to attain the goals.
5. Helps in Decision Making: Planning serves as the basis for decision making. Planning involves analysing the future, evaluating the various courses of action and choosing best alternative as per the objective. Thus, following a proper planning process helps the managers in taking rational decisions.
6. Essential for Controlling: Planning states the objectives that are to be achieved. Thus, it sets the standards against which the performance is evaluated. It also helps in determining whether there is any deviation from the said objectives and thereby, facilitates the corrective measures. Hence, we can infer that despite the costs involved, planning is a very important function in management and worth the costs incurred.

The main features to be considered by the management while planning are:

1. It Focuses on Achieving Objectives: Planning is purposeful. Planning has no meaning unless it contributes to the achievement of predetermined organisational goals.
2. It is the Primary Function: Planning lays down the base for other functions of management. All other managerial functions are performed within the framework of the plans drawn. Thus, planning precedes other function.
3. Planning is Pervasive: Planning is required at all levels of management as well as in all departments of the organisations. The top management undertakes planning for the organisation as a whole. Middle management does the departmental planning. At the lowest level, day-to-day operational planning is done by supervisors.
4. Planning is Continuous: Plans are prepared for a specific period of time, may be for a month, a quarter or a year. At the end of that period, there is need for a new plan to be drawn on the basis of new requirements and future conditions. Hence, planning is a continuous process.
5. Planning is Futuristic: The purpose of planning is to meet future events effectively to the best advantage of an organisation. It implies peeping into the future, analysing it and predicting it.
6. Planning Involves Decision Making: Planning essentially involves choice from among various alternatives and activities. If there is only one possible goal then there is no need for planning. The need only arises when alternatives are available. Planning thus, involves thorough examination and evaluation of each alternative and choosing the most appropriate one.
7. Planning is a Mental Exercise: Planning is basically an intellectual activity of thinking rather than doing, because planning determines the action to be taken. Planning requires logical and systematic thinking rather than guesswork or wishful thinking.

The concept of management involved in the given situation is planning:

1. Manager of the baby garments manufacturing company must take the following steps before deciding to 'use waste material to increase profits of the company:

1. Setting objectives- to increase profits of the company.
2. Developing premises.
3. Identifying courses of action 'purchasing new high speed machines or increasing the sale price or using waste material'.
4. Evaluating alternative courses.
5. Selecting an alternative- 'deciding to use waste material.

2. To complete the process of the planning, manager has to take the following steps:

1. Implement the plan
2. Follow-up action

Following are the steps of planning process:

1. Setting Objectives: Objectives are those end points for whose attainment all the activities are undertaken. In the planning process objectives are determined and defined first of all so that all the employees concerned can be informed about them to get their complete cooperation. Objectives have a hierarchy of their own, e.g., organisational objectives, departmental objectives, and individual objectives. They are determined and defined in the same hierarchical order.
2. Developing Premises: The basis of planning are those factors/ assumptions which influence the possible results of different alternatives. Before taking a final decision about any alternative a forecast of these assumptions is made. The rate of success of planning will be in direct proportion to the rate of the success of forecasting. The assumptions/ premises ofplanning are of two types: a. Internal Premises: Capital, labours, raw material, machinery, etc. b. External Premises: Governmental policies, business competition, tastes of customers, rate of interest, rate of taxes, etc.
3. Identifying Alternative Courses of Action: Generally, there is no work which has no alternative method of doing it. On the basis of the objectives of the organisation and the limitations of planning, alternative courses of doing a particular work can be discovered.
4. Evaluating Alternative Courses: At this stage, it is seen as to what extent a particular alternative course can help in the attainment of the objectives of the organisation. There is, however, one problem which confronts us while analysing these alternative courses. Every alternative course has its merits and demerits. In such a situation the planners should evolve a new alternative course by a mixture of different alternative courses.
5. Selecting an Alternative: After a careful analysis of different alternatives the best one is selected. Sometimes the analysis yields more than one alternative course with similar merits. Keeping in view the uncertainties of future it is justifiable to select more than one good alternative course. One of such alternatives is adopted and the other is kept in reserve. In case the future forecast proves wrong and the first alternative course fails, the reserve one can immediately be brought into operation and failure can beaverted. vi. Implementing the Plan: After having decided the chief plan and the subsidiary plans, they are to be implemented. After implementing the plans the sequence of different activities has to be decided. In other words, it is decided as to who will do a particular job and at what time.
6. Follow Up Action: The process of planning does not end with the implementation of plans. Plans are formulated for future which is uncertain. It is of great importance that there is a constant review of plans so as to ensure success in the uncertain future. The moment there appears to be changes in the assumptions on which the plans are based, there should be corresponding changes in the plans also. In this way we can say planning is a continuously moving process.

Yes, I do agree with this statement. No doubt planning is an important tool of management but it is not free from limitations. That is why, it can be said that it is not a remedy of all types of problems. Following are the limitations of it:

1. Planning Creates Rigidity: Although the quality of flexibility is inherent in planning, but it must be admitted that only small changes are possible. Big changes are neither possible nor in the interest of the organisation. Since it is not possible to introduce desired changes according to the changed situations, the organisation loses many chances of earning profits.
2. Planning does not work in a Dynamic Environment: Planning is based on the anticipation of future happenings. Since future is uncertain and dynamic, therefore, the future anticipations are not always true. Therefore, it can be said that planning does not work in dynamic environment.
3. Planning Reduces Creativity: Under planning all the activities connected with the attainment of objectives of the organisation are pre-determined. Consequently, everybody works as they have been directed to do and as it has been made clear in the plans. Therefore, it checks their incisiveness. It means that they do not think about appropriate ways of discovering new alternatives.
4. Planning Involves Huge Costs: Planning is a small work but its process is really big. Planning becomes meaningful only after traversing a long path. It takes a lot of time to cover this path. During this entire period the managers remain busy in collecting a lot of information and analysing it. In this way, when so many people remain busy in the same activity, the organisation is bound to face huge costs.
5. Planning is a Time Consuming Process: Planning is a blessing in facing a definite situation but because of its long process it cannot face sudden emergencies. In such a situation, if the manager thinks of completing the planning process before taking some decision, it may be possible that the situations may worsen or the chance of earning profit may slip away. Thus, planning is time consuming and it delays action.

The planning process involves the following steps:

1. Establishing Objectives: The first step in planning is to determine objectives which must be realistic, specific and clear so as to specify what is to be accomplished by the network of policies, procedures, strategies etc.
2. Developing Premises: They include assumptions or forecasts of the future and unknown conditions that will affect the operations of the plans. They provide an idea about the future which facilitates the work of planning.
3. Identifying the Alternative Courses of Action: The next step in planning is to identify the various alternatives available to achieve the objectives.
4. Evaluating Alternative Courses: The merits and demerits of different courses of actions are evaluated in the light of objectives to be achieved and their feasibility is judged i.e., how far they will be successful in helping to achieve the objective.
5. Selecting an Alternative: The next step is to find out the most suitable course to be followed. The efforts are directed towards selecting that course. Which increases efficiency in the organisation by maximising output and profits at the minimum costs.
6. Implement the Plan: At this step the best alternative chosen is put to use.
7. Follow Up: Only putting the best alternative to action is not enough. The future is uncertain and dynamic. Therefore, it becomes important to check back whether the plan is giving results or not.