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Questions and Answers
What is the typical time frame covered by long-term planning?
Which level of management is responsible for conducting strategic planning?
What is the main advantage of long-term planning compared to short-term planning?
Which type of planning focuses on the purchase of materials, production, and overhead expenses for a period between two and five years?
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What is the main disadvantage associated with long-term planning?
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Who is typically involved in intermediate planning within an organization?
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What distinguishes formal planning from informal planning?
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Why is it beneficial for plans to be formal when the number of actions is large?
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What characterizes short-term planning in terms of duration?
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Which advantage is associated with short-term planning?
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What is a key distinction between formal and informal planning?
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Why might an organization choose informal planning over formal planning?
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Study Notes
Planning in Management
- Planning can be classified into three types based on duration: short-term, medium-term, and long-term planning
- Long-term planning covers a period of more than five years, typically between five and fifteen years
- Long-term planning deals with broader technological and competitive aspects of an organisation and allocation of resources
- Long-term planning is considered strategic planning
Short-term Planning
- Covers a period of less than two years
- Must be formulated in a manner consistent with long-term plans
- Concerned with immediate future and current operations of the business
- Advantages: easily adjustable, changes can be made and incorporated, easy to gauge, and requires little resources
Medium-term Planning
- Covers a period of between two and five years
- Focuses on planning for purchases of materials, production, labor, overhead expenses, and more
Levels of Management
- Strategic Planning: conducted by top management, covers a time period of up to 10 years, and deals with the total assessment of an organisation's capabilities
- Intermediate Planning: covers time frames of about 6 months to 2 years, and is contemplated by middle management
- Operational Planning: deals with current activities and is concerned with the day-to-day operations of the business
Nature of Planning
- Formal Planning: reduced to writing, helps in adequate control, and determines objectives of planning
- Informal Planning: not in writing, conceived in the mind of the manager, and effective when the number of actions is less and actions have to be taken in short period
- Advantages of formal planning: proper cooperation among employees, unity of action, economy, proper coordination and control, choosing the right objectives, and future planning
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Description
Learn about formal planning in management, including its characteristics, advantages, and importance. Understand how formal planning helps in achieving organizational goals and promoting cooperation among employees.
