Unit IV

Planning Process

A) Introduction of Planning

Planning is the primary function of management. Planning is deciding the

objective to be achieved and taking suitable follow-up steps for achieving the
same. It is a systematic activity which determines when, how and who is going
to perform a specific job. Planning functions is performed by managers at all
levels.

Definition of Planning

”Planning is deciding in advance what to do, how to do it, when to do it and who
is to do it.” - Koontz and O’Donnel

B) Steps in Planning

Planning is a lengthy process. The steps involved in this process are:

1. Analyze environmental factors: This is a pre-step of planning process which

is essential to make a successful plan. The management has to analyze internal
and external environment. The internal environment consists of factors within the
organization such as materials, machines, manpower, organizational structure,
technology etc. On the other hand, external environment includes factors outside
the organization such as government rules, economic condition, competitors'
strategies, customers' taste, social and cultural belief etc. Such a study helps in
identifying strengths, weaknesses, opportunities, and threats.

2. Setting objectives: The actual planning process starts with setting objectives.
This is the first and real starting point of planning. Objectives provide a rationale
for undertaking various activities as well as indicate direction of efforts. These
help on focusing on the end results to be achieved. The objectives must be
specific, clear, and practical. They should be time bound and expressed in
numerical terms.

3.Establishment of planning premises: Premises are the assumptions which

serve as the basis of planning. Premises are established through forecasting.
These premises may be tangible or intangible and internal or external.
a) Tangible and intangible: Tangible premises can be measured in quantitative
terms. These include capital investment, units produced and sold, hours of work
etc. On the other hand, intangible premises cannot be measured in quantitative
terms. In other words, these are qualitative in nature. For instance,
goodwill, motivation, managerial attitude, employee's motivation etc.

b) Internal and external: Internal premises come from the internal environment.
It includes money, materials, machines, and management. On the other hand,
external premises come from the external environment. For instance,
government policies, technological changes, competitor’s strategies etc.

4. Determination of alternatives: The next step is to consider alternative courses

of action for the achievement of organizational objectives. The information about
alternative courses of action may be obtained from primary and secondary
sources.

5. Evaluation of alternatives: Every alternative must be evaluated by weighing

its pros and cons in the light of resources available and the requirements of the
organization. In other words, the merits, demerits as well as the consequences of
each alternative must be examined before making the choice. This is done to find
out expected cost and benefits. Some of the factors considered for evaluation are
risk, resources, technology, responsibility etc. The planners should take help of
various quantitative techniques to evaluate the alternatives.

6. Selecting a course of action: The next step is to select the best course of action.
The plan which gives maximum benefit at minimum cost is selected. The
management must also consider experience, present situation and future
contingencies of such decision.

7. Formulation of derivative plans: Derivative plans are the sub plans or

secondary plans which help in the achievement of main plan. These are meant to
support and expediate the achievement of the main plan. These include
formulation of policies, procedures, rules, programmes, budgets, schedules, etc.
For example, if profit maximization is the main aim of the enterprise, derivative
plans will include sales maximization, production maximization, and cost
minimization.
8. Implementation: The plan is thereafter implemented. This step brings all the
procedure of plan into action. For implementation plan, management has to take
some steps such as:

 Communicate with subordinates who would implement the plan

 Provide necessary instructions and guidance
 Make arrangement of all resources like materials, machines, money,
equipment, etc.
 Timely supervision and control over subordinates.
9 Reviewing the planning process: After the selected plant is implemented, it is
important to appraise its effectiveness. This is useful for understanding the actual
progress and deficiencies in the execution of the plan. It enables the management
to correct deviations or modify the plan. This step is required so that the future
plans can be made more realistic.

C) Importance of Planning

Planning is the first and one of the most important functions of management. It is
needed at every level of management. In the absence of planning all the business
activities of the organisation will become meaningless. The importance of
planning has increased more in view of the increasing size of organisations and
their complexities and in this complex business environment. The importance of
planning can be explained as under:

1. Helps to achieve objectives: Every organization has certain objectives. For

example, to earn profits, earn goodwill, counter competition, market expansion
and so on. Planning provides a rational approach to predefined objectives.
Through proper planning and implementation, these objectives can be achieved.

2. Provides direction: Planning helps an organization to avoid aimless activities.

Under the process of planning the objectives of the organisation are defined. Due
to this, the employees get a direction and all their efforts are focused towards a
particular end. Planning tells them what to do, how to do it and when to do it. In
other words, planning gives proper instructions and useful guidance to the
subordinates. Proper direction leads to orderly and meaningful action. 3. Assists
in organizing: Organizing means to bring together all available resources.
Organizing is not possible without planning. This is because, due to planning it is
possible to estimate the number of resources required and when they are needed.
Thus, planning aids in organising.

4. Facilitates decision making: Planning sets target for decision making.

Planned targets serve as the criteria for evaluation of different alternatives so that
the best course of action may be chose. In this way, planning facilitates decision
making. Without planning business decisions would become random ad hoc
choices.

5. Helps in co-ordination: Proper planning interrelates all the activities and

resources of an organisation. The activities and efforts of various departments and
divisions can be harmonized with the help of proper planning. Similarly, the
short-term, medium-term and long-term plans of an organization can also be
coordinated by efficient planning. Planning leads to a consistent and coordinated
structure of operations.

6. Facilitates control: Planning provides the basis for control. Plans serve as
standards or benchmarks for the evaluation of actual performance. With control,
the actual performance of an employee is compared with the plans, and deviations
(if any) are found out and corrected. It is impossible to achieve such a control
without right planning. Therefore, planning becomes necessary to keep a good
control.

7. Reduces risks and uncertainty: Planning is always done for future and future
is uncertain. With the help of planning possible changes in future are anticipated.
Planning helps to prepare for future uncertainties in advance. Thus business risks
can be reduced. Planning enables an organisation to cope with uncertainty and
change.

8. Optimum utilisation of resources All organizations, large and small, have

limited resources. The planning process provides the information top
management needs to make effective decisions about how to allocate the
resources in a way that will enable the organization to reach its objectives.
Productivity is maximized and resources are not wasted.

9. Encourages innovation and creativity: Innovation and creativity are

prerequisites to continuous growth and Steady prosperity of business. Sound
planning encourages innovative thought and creativity of the management.
 10. Motivates personnel: A good plan provides various financial and non-
financial incentives to both managers and employees. These incentives motivate
them to work hard and achieve the objectives of the organization. Thus, planning
through various incentives helps to motivate the personnel of an organization.

11. Others

 Planning helps to identify potential threats and opportunities. It also keeps

management alert to the changing environment of business. Planning makes
optimum utilization of all available resources. It helps to reduce wastage of
valuable resources and avoids their duplication. It thus increases the overall
efficiency.
 If activities are not properly planned in anticipation of what is likely to happen,
pressures will be exerted to achieve certain results immediately or a in a hurry.
Thus, 0adequate planning supplies orderliness and avoids unnecessary pressures.
Proper planning helps in reducing mistakes and oversights.
 Finally proper planning helps the organization to remain competitive in business.
Planning may suggest addition of a new product line, changes in the methods of
operation, better identification of customer needs and so on. This helps in creative
competitive advantage.

D) Components of Planning

1. Mission: Mission defines the fundamental purpose for the existence of an

organization. A mission statement answers the question, "Why do we exist?" It is
a statement which reflects the vision and the philosophy of the organization. It
provides employees, customers and corporate stakeholders with a business
definition to establish a sense of purpose, identity and commitment. It gives an
idea of the long term commitments of the organization. It makes the existence of
the organization meaningful.

2. Objectives: In simple words, objectives mean the goals, purpose or aim of

business. These are the ends towards which actions are directed. Objectives act
as a base for all planning and strategic activities. Examples of objectives are to
increase profit, to increase market share, to earn corporate image, to reduce labour
turnover etc. Objectives help in achieving the mission. The following elements
are associated with each objective:
  Accountability: assigns an individual to oversee completion of the
objective.
 Timeframe: describes the "due date" for completion of the objective.
 Resources: describes the need for personnel and funds required to reach the
stated objective.

3. Strategies: A strategy is a long term action plan for achieving the goal. Strategy
is an action that managers take to attain one or more of the organization's goals.
Strategy can also be defined as "A general direction set for the company and its
various components to achieve a desired state in the future. A strategy is all about
integrating organizational activities and allocating the scarce resources within the
organizational environment so as to meet the present objectives. Strategy deals
with long term developments rather than routine operations, i.e. it deals with
probability of innovations or new products, new methods of productions, or new
markets to be developed in future.

4. Policies: Policies are principles, rules and guidelines formulated by an

organization to reach its long term goals. These are general statements that guide
in decision making. Policies provide framework within which decisions are taken.
Policies enable proper delegation of work. They also bring consistency in the
operations. Policies are prepared in regards to sales, purchases, promotions, and
for other functional areas.

5. Procedures: Procedures are the specific methods employed to express policies

in action in day-to-day operations of the organization. A procedure is a particular
course of action intended to achieve a result. A procedure is an established way
of performing the work. It involves a series of steps that are required in order to
perform a particular task. For example, while recruiting an employee following
procedure might be followed:

• Advertisement of the job • Group discussion

• Medical test • Written examination

• Personal interview • Selection

• Induction training

6. Rules: A rule is the principle to which action conforms or is required to

conform. Action of an individual or a group has to be within rules. Rules are
specific statements of what should be done and what should not be done in certain
situations. For example, "Non vegetarian food not allowed in company's
premises" is a rule. Rules do not provide scope for discretion. The breach of rules
usually carries penalty. Rules differ from policies. Policies not only guide
decision makers, but they specify areas where the manager can use discretion.
While in case of a rule no discretion is allowed.

7. Programmes: A programme is a series of steps to be carried out to implement

the policies and accomplish the goals. A programme includes procedures,
policies, rules, etc. that are needed to carry out the course of action. Different
types of programmes include expansion programme, management development
programme, training programme and so on.

8. Budget: A budget is a financial plan and a list of all planned expenses and
revenues. It is an organizational plan stated in monetary terms. A budget serves
as a plan of action for achieving quantified objectives. Different types of budget
include cash budget, production budget, advertising budget, sales budget and so
on. Budget provides a standard for measuring the actual performance and finding
out the deviations.

9. Schedules: A schedule means a timetable for activities. It is a time sequence

of work to be done. Proper scheduling is required for implementing the plans
smoothly.

10. Contingency Plan: A contingency plan is a plan devised for an outcome other
than in the usual (expected) plan. In other words, it is a plan for meeting an
emergency. It involves suitable backups, immediate actions and longer term
measures for responding to emergencies such or accidents or disasters. It is often
used for risk management. During times of crisis, contingency plans are often
developed to explore and prepare for any eventuality. Plans of this type allow
businesses to quickly adapt to changing circumstances and remain in operation,
sometimes with very little inconvenience or loss of revenue.

E) Coordination

Coordination function is the orderly arrangement of individual and group efforts

to provide unity of action in the pursuit of a common goal. It ensures unity of
action among individuals. Work groups and departments and brings harmony in
carrying out the different activities and tasks so as to achieve the organizational
goals efficiently.

Definition of Coordination

“Coordination is orderly arrangement of group efforts to provide unity of action

in the pursuit of common goals.” - Mooney and Reelay

F) Features of Coordination

1. Continuous process: Coordination is a never-ending process. It starts with the

functions of planning and continues till controlling. It is an ongoing process,
required for the efficient functioning of the organisation.

2. Integrates group efforts: Coordination gives a common direction to group

efforts to ensure that work is performed according to the plans. Such need arises
as individuals working in an organization have different backgrounds and styles
of working.

3. Ensure unity of efforts: Coordination integrates the functions of all

departments and ensures that all activities aim at accomplishment of
organisational objectives. For example, in a manufacturing unit, the production
department, sales department and purchase department are interdependent. Sales
department has to provide production department with information about the
demand of the product and purchase department needs to know the quantity of
raw material required to meet the demand. In case of lack of coordination,
functioning of all these departments will be affected.

4. Pervasive: All the activities of an organization are interrelated and

interdependent. Thus, coordination is required at all levels and in all departments.
For example, the coordination among purchase, production and sales department
is essential for achieving organisational goals. The activities can be performed
smoothly in the production department if purchase department provides the
required raw material, in time. Similarly, the sales activities can be performed
only when there is sufficient timely production of goods.

5. Responsibility of all managers: Coordination is basically a managerial

responsibility. It is the exclusive responsibility of the manager. As he has the
overall picture of the enterprise, only he is in a better position than others to
perform this function.

6. Deliberate function: Coordination calls for a conscious and deliberate effort

on the part of managers at various levels. It cannot be left to mere co-operation
among individuals in the organization.

G) Importance of Coordination

Coordination is not really a separate function of management but in fact it is the

essence of management. It is an integral element of all the managerial functions.
Its importance can be explained as under:

1. Proper direction: There are many departments in the organization. Each

department performs different activities. Coordination integrates these activities
for achieving the common goals or objectives of the organization. Thus,
coordination gives proper direction to all the departments of the organization.

2. Optimum utilization of resources: Coordination helps to bring together the

human and material resources of the organization. Further these resources can put
to optimum use. This increases productivity of the organization. Coordination
also minimizes the wastage of resources in the organization.

3. Organizational goals: Coordination helps to minimize the conflicts, wastages,

delays, and other organizational problems. It ensures smooth working of the
organization. Therefore, with the help of coordination an organization can
achieve its objectives easily and quickly.

4. Higher efficiency: Efficiency is the relationship between Returns and Cost.

Efficiency is higher when the returns are more and the cost is less. Since
coordination leads to optimum utilization of resources it results in more returns
and low cost. Coordination helps to improve the efficiency of operations by
avoiding overlapping efforts and duplication of work.

5. Better relations in the organization: The Top Level Managers coordinates

the activities of the Middle Level Managers and develop good relations with
them. Similarly, the Middle Level Managers coordinate the activities of the
Lower Level Managers and develop good relations with them. The Lower Level
Managers coordinate the activities of the workers and develop good relations with
them. Thus, coordination, overall improves the relations in the organization.

6. Good Human Relations: Coordination improves the morale and job

satisfaction of employees. Composite and orderly effort established through team
spirit and executive leadership enables employees to derive a sense of security
and personal contentment from their job. A well-coordinated organisation can
attract, retain and utilize better personnel. Coordination improves human
relations by reconciling individual and organizational objectives.

7. Reduce conflicts: Many tasks in an organization are interdependent. If these

are not achieved, there is a possibility of blaming others. This can lead to inter
personal or inter departmental conflicts. If coordination exists, then the
employees are likely to complete their tasks on time, thereby reducing conflicts.

8. Unity of direction: Coordination helps to ensure unity of action. Different

departments and sections work together as a cohesive unit. This ensures stability
and growth of the organisation.

9. Organizational effectiveness: Coordination fosters loyalty and commitment

among employees. This enhances the effectiveness and stability of the
organization.

H) Introduction of Delegation of Authority

When it comes to running a business, or rather an organization, it is a must that

you understand all the aspects that are associated with it. One such aspect is where
the tasks run smoothly, without a delay. This is where one must take into account
all the considerations like many of the things including how the tasks must be
distributed. Now, the tasks must be done in more of a streamlined manner where
all the people are given responsibilities where they can work more efficiently and
take the organization to newer heights.

This can happen by taking the very first steps such as delegation of authority. This
is the one task that all managers must put into practice since there is a lot of
ground to cover. One can rest assured by bringing such things into practice that
they can have the work done in a more efficient manner where deadlines can be
met easily.
 Although there is a phenomenon where one must take the authority of the work
given to them, it is also a must that one challenges their subordinates with new
responsibilities. Since running an organization is not a one person job, so is the
case with taking the authority for various things. It is a great thing for every
manager to include their subordinates in the tasks and put them as one in
authority.

I) Elements of Delegation of Authority

Now that you know what delegation of authority is, you must also know that it is
not just transfer of tasks and authority to one's subordinates. However, the
meaning seems to be a simple one, there are many benefits along with a fair share
of risks involved. It is the job of a manager that they take into account the various
risk factors along with the trust factor of their subordinates and then delegate the
work accordingly.

Here are the three elements of Delegation of Authority:

 Authority
 Accountability
 Responsibility
It is worth noting that these three may look like elements, but these are all
predominant when it comes to the functioning of an organization. It has many
effects for the organization, which can make or break it, in a major way.

J) Process of Delegation of Authority

The Process of Delegation of Authority has seven sequential steps. Each step has
its significance and continuity. So it is important to understand every step then
delegate the authority accordingly.

Step 1:
The first step in the process of delegation of authority is to set the goals for which
we are assigning work to the subordinate.

Step 2:
After setting up the goals, the manager or the responsible person needs to define
the responsibilities of the employee. This makes the employee learn or understand
what he needs to do and whom he needs to report or take instructions.

Step 3:
In the process of Delegation of Authority, the third step is more crucial than all
other steps. This step is about defining the Author to subordinates. The authority
varies from employee to employee based on the job assigned to them.

Step 4:
The next step is to motivate all the subordinates. The manager is supposed to not
only delegate or assign the work to the support units. He also needs to encourage
his employees to work effectively and fastly by putting all their efforts. The
manager also monitors all the day-to-day actions done by subordinates.

Step 5:
The process of delegation of authority also has accountability in its steps. The
manager needs to hold accountability regarding his employees. The manager or
company should not depend on the employees.

Step 6:
In the process of delegation of authority, the manager needs to train his
subordinates according to the job assigned. If a new task is given to the employee
in a different language, he needs to train his subordinate and ask him to learn and
develop his skills by working on new tasks.

Step 7:
The last step in the process of delegation of authority is to control the employees
by maintaining proper appraisals for the performance.
K) CONTROLLING
Meaning
Planning is a process by which an organization's objectives and the methods to
achieve the objectives are established. After strategies are set and plans are made,
management's primary task is to take steps to ensure that these plans are carried
out. This is done by the control function. Controlling is a process that measures
and directs the actual performance against the planned goals of the organization.
A major part of the control function is making sure other people do what should
be done.
Controlling is an essential function for all levels of management. It ensures that
the right things are done in the right manner at right time. It is the act of
restricting, limiting, managing, and checking results. Controlling refers to
measurement of actual performance and expected performance and taking
corrective action. Its purpose is to make sure that actual performance is consistent
with plans.
Definitions
Koontz and O'Donnell state that, "Managerial control implies the measurement
of accomplishment against the standard and the correction of deviations to assure
attainment of objectives according to plans".
L) Features of Controlling
1. Continuous Process
Controlling is a continuous process. It is required for all activities and all times
in an organization.
2. Systematic Process
Controlling is a systematic process of measuring the performance of the
employees.
3. Management Function
Controlling is an important function of management. Every manager in an
organization has to perform the control function. The control may be quality
control, inventory control, production control, administrative control and so on.
4. Pervasive
Controlling function is performed in all types of organizations whether -
commercial or non-commercial and at all levels i.e. top, middle, and supervisory
levels of management. It is embedded in each level of organizational hierarchy.
5. Related to Planning
Planning and Controlling are two integrated functions of management. Without
one, other would be a meaningless exercise. Controlling function succeeds
planning.
6. End Function
Controlling is a function which occurs after the tasks have been performed. It is
preceded by planning, organizing, directing and coordinating.
7. Future Oriented
Controlling is future oriented. It is possible to control future happenings but not
what has already happened. However, past events and their performance helps in
having an effective control of future performance Hence the past performance is
measured for taking corrective actions for future periods.
8. Techniques of Controlling
Several techniques are used for controlling the performance of the employees in
an organization. Some of these include Budgeting, PERT, Management audit,
Observation, Internal audit, and so on.

M) STEPS IN THE CONTROLLING PROCESS

1. Establishment of standards
The first step in the controlling process is laying down the standards. Standards
are the benchmarks or the targets which need to be accomplished in the course of
operations. Standards specify what is expected from the employees in their given
tasks. Standards are basically the criterions to judge the performance. Standards
could be tangible or intangible.
Standards that can be measured and subsequently expressed are called
measurable standards. They could be in form of time, cost, output, expenditure,
profit, appreciation, growth, market share, user base etc. On the other hand,
Intangible standards cannot be measured. For instance, change in attitude of
employees, job satisfaction etc.
2. Measurement of performance
The next step is to measure the performance of employees. Wherever possible the
performance must be quantified. This makes measurement objective and
unbiased. On the other hand, it is difficult to gauge qualitative performance.
Qualitative assessment becomes a challenge.
3. Comparison of actual and standard performance
Here, actual performance is compared with the standard performance.
4. Identifying deviations
The next step is identifying the deviations i.e. finding out the gap between the
actual performance and the planned targets. It means finding out in which areas
and to what extent the actual performance varies with the pre-determined
standards.
5. Analysing causes of deviations
After identifying deviations, the manager must find out the causes of such
deviations. The causes may be incorrect planning, coordination lapses, defective
implementation, ineffective communication, ineffective supervision and so on.
The areas and reasons of variances should be clearly spelt out.
6. Taking remedial actions
The next step is to take remedial action. This can be done by making new plan. If
the targets set are too high, the targets could be revised downwards. The new plan
may also redefine the duties and responsibilities of the staff. The corrective plan
is then implemented.
7. Feedback
It is necessary to get feedback about the new plan i.e. to check whether or not it
has succeeded in improving the performance.

N) Steps in Project Formulation

The formulation of a good project proposal is not an easy task. It requires a lot of
exercise on the part of proposal formulator both before and during the preparation
of project proposal. Before writing a project proposal, the project coordination or
institution has to take care of following pre- project formulation aspects.

1) Review of past project proposals: A group that is involved in the formulation

of project proposal needs to review similar types of project proposal formulated
by its own institution or other institutions. This will give an idea about the
strengths and weaknesses to the project coordinator while thinking about
formulating any project.

2) Consulting experts, consultants, and previous project coordinators: A

person or group formulating proposal could consult an expert in the area in which
the intended project is going to be formulated and even can appoint a consultant
who could be helpful in the preparation of the proposal. It is always better to
consult a person who has already completed similar type of projects which are
being attempted. The project coordinator formulating project proposal can
consult his/her fellow colleagues who have already formulated similar types of
project proposals.

3) Review past project evaluation reports: Before formulating a proposal, it is

advisable to go through the reports prepared by a similar type of research
organizations/institutions. The project evaluation report, besides, providing the
components of project activities and strategies, will give details about the
methodology, evaluation, and impact assessment strategy.

4) Interact with the prospective beneficiaries: The project team can also
interact with the prospective beneficiaries to be benefited from the project
interventions and assess their need. It would be better if the coordinator could
also interact with those who have already received benefits from the similar types
of project.

5) Check statistical data/ report: The data regarding a previous similar types of
projects from various documents must be collected so that an appropriate project
strategy is formulated.

6) Hold focus group discussion: It is always better that the person who prepares
a proposal undertakes a focus group discussion with the beneficiaries or the
prospective clienteles or the stakeholders. If it is a training project for grassroots
level representatives e.g., urban local bodies, then the training organizer could
conduct a focus group discussion with the elected representatives and
functionaries of urban local bodies and assess their needs.

O) Organisational Goal and Objectives

As stated earlier, the concept of ‘goal’ gets reflected in the definitions of

organization, wherein it has been repeatedly reinstated that the purpose of
organization is to achieve the

purpose or goals of the organization. Goals and objectives are a critical

component of an organization. Goals and objectives formulated for an
organization are helpful to achieve the mission, make the vision a reality and
navigate the course so set for the organization. Goals are the big steps towards
accomplishing the mission/vision and they should be aligned with the principles
and values of organization. Goals, when accomplished, should bring organization
closer to its vision. On the other hand, organizational objectives are those smaller
steps that the organization takes to accomplish the goals.

Further, goal can be defined as a specific desired accomplishment over a defined

period of time. An organizational decision to be the best may be admirable, but it
is not a goal. It is a desire, a wish, or a dream visualized by the organization. To
make any desirable idea into a goal, organization must subject it to five criteria,
popularly known as SMART, viz.:

 Specific
 Measurable
 Attainable
 Relevant
 Time-trackable

SMART, has been regarded as a method of goal-setting, that was made popular
by super salesman Zig Ziglar and this is the most commonly used method to
realize either the individual goals or organizational goals. This method serves as
an effective instrument in formulating well-established organizational goals.

Sometimes goals and objectives of an organization are confused with each other
and are interchangeably used. However, there are considerable differences
between both the terms. Goals are the outcome statements that define what an
organization is trying to accomplish, both programmatically and organizationally.
Goals are usually a collection of related programmes, a reflection of major actions
of the organization, and provide rallying points for managers. On the other hand,
objectives are very precise, time-based, measurable actions that support the
completion of a goal. Objectives are directly related to the goal and are expressed
in clear, concise and understandable form.

An organization, in order to be effective, has to state their goals and objectives in

written form. If they are not in written form, they are just like any other ideas with
no real powers. It has to be understood that only written goals and objectives
provide motivational power among employees or whosoever is concerned to
achieve them. Clearly and specifically written goals prevent confusions and
misunderstandings. Further, a well-written goals and objectives, facilitates easy
assessment of the organizational performance, as the results can be measured in
comparison with the time frame in accomplishing the goals.
P) Setting Company Standards

You have personal values, beliefs , and performance benchmarks. Your business
also has these characteristics and they are referred to as company standards. Think
of standards as your business personality and vision coupled with the rules you
live and work by. Your small business standards will likely mirror your personal
standards, and your customers, clients , and employees will form an opinion about
your business – and your brand – based on these values.

What are standards?

Your standards define how your company acts, which, in turn, builds trust in your
brand. They can be guidelines that describe quality, performance, safety,
terminology, testing, or management systems, to name a few. They can comply
with authoritative agencies or professional organizations and be enforceable by
law, such as required medical degrees for doctors or credentials for financial
planners. Or they can be voluntary rules you establish to create confidence among
your clients that your business operates at a high and consistent quality level, such
as a restaurant only using the highest quality, locally-sourced ingredients.

Standards must align with your mission, business objectives, and organizational
leadership, and be implemented consistently across your enterprise. Employees
need to buy into the value of adhering to standards so everyone is pulling in the
same direction and reinforcing your brand.

Controlling and measuring standards

Standards are what your business aspires to, but they don’t guarantee
performance. You need to create processes to control how your standards are
implemented, and measure and evaluate how they help your business grow.
Written guidelines, technical specifications, product inspection processes,
management and financial audits, and even customer surveys can be effective
performance indicators and help you determine if you’re meeting your standards,
or if the standards need to be tweaked in some way.

Q) Vision
 A vision articulates the position that an organization would like to attain in the
distant future. It helps in creating a common identity and a shared sense of
purpose. A good vision is one which foster risk taking and experimentation. It
answers the question: ‘What will success look like?’

The vision of an organization must possess the following characteristics:

 It is created by consensus.
 It forms a company’s future mental image.
 It forms the basis for formulating the mission statement.

A good vision possesses the following features:

 It should be inspiring.
 It should foster long term thinking.
 It should be original and unique.
 It should be competitive.
 It should be realistic.

Examples

Walt Disney: Make people happy

Stokes Eye Clinic: Our vision is to take care of your vision

R) Mission
Mission refers to the purpose of an organization. Mission states the business
reason for the organization's existence. It relates the organization to the society.
The mission of an organization should aim high and at the same time it must be
realistic. It should provide a strategic direction for the organization.

“Mission is the fundamental work given by the society to an organization”.

By Koontz & O’donnell

Features of Mission

(i) A mission statement should be realistic and achievable. Impossible statements

do not motivate people.
(ii) It should neither be too broad not be too narrow. If it is broad, it will become
meaningless. A narrower mission statement restricts the activities of
organization. The mission statement should be precise.

(iii) A mission statement should not be ambiguous. It must be clear for action.
Highly philosophical statements do not give clarity.

(iv) A mission statement should be distinct. If it is not distinct, it will not have
any impact. Copied mission statements do not create any impression.

(v) It should have societal linkage. Linking the organization to society will build
long term perspective in a better way.

(vi) It should not be static. To cope up with ever changing environment, dynamic
aspects should be considered.

(vii) It should be motivating for members of the organization and of society. The
employees of the organization may enthuse themselves with mission statement.

(viii) The mission statement should indicate the process of accomplishing

objectives. The clues to achieve the mission will be the motivating factor.

Example:

NIKE Inc.: To Bring Inspiration and innovation to every athlete in the world.

There are diverse issues which need to be covered while framing the mission
statement of a company. The various components of a well framed mission
statement are stated as follows:

 Product or service
 Customers
 Technology
 Survival, growth and profitability
 Company philosophy
 Public image

S) Vision Statements
In business, having a clear vision provides the foundation for developing a
mission statement. A firm must first know where it wants to go before it can
determine its strategy of how it wants to get there. Research suggests that vision
statements should be short, approximately once sentence in length and include as
many managers as possible in developing the statement.
Jeff Weiner, CEO of LinkedIn, was recently voted the best CEO in the United
States and recently stated at a conference in San Francisco the single most
important attribute of being an effective leader is articulating the firm’s vision as
meticulously and clearly as possible to everyone at the organization. Former CEO
of Colgate, Reuben Mark is another large believer in vision statements,
indicating, with respect to vision, it is best to push one vision globally than many
different smaller messages in various different cultures.
The vision pushed should be inspiring and not focused on financial means, as
according to Mark, it is difficult to motivate employees into charging the machine
guns (referring to the completion and their tactics) for purely financial objectives,
there must be something more palpable, more meaningful than merely financial
objectives.
Generally, a well-developed and thought out vision statement will provide
improved direction for the firm and its stakeholders. Overall, the literature on
vision statements is not as developed or robust as the prior literature on mission
statements. One of the goals of this paper is to improve the theoretical
contribution by developing improved insight on vision statement construction
and its association with organizational performance.
Toyota's vision statement
"Lead the way to the future of mobility, enriching lives around the world with the
safest and most responsible ways of moving people".
Ashok Leyland vision statement
To be the Preferred choice for Customers in Quality, Delivery and Quick Product
Development.
Maruti Suzuki vision statement
Shaping the Future of Mobility.