PROCESS OF PLANNING

All organizations engage in planning activities, but no two organizations plan in exactly the same way. Following are the steps of planning process that many organizations attempt to follow:

(1) Assessing the Organization's Environment

A plan for the future begins with an assessment of the current situation in which the organization exists. A systematic, thorough analysis requires attention to four things: internal strengths and weakness, and external opportunities and threats. Such as analysis is often refereed to as SWOT analysis.

(2) Establishing Mission Statement

After assessing the environment, managers first establishment organization's mission. The organizational mission is a long term vision of what the organization is trying to become. It provides the reason for existence. The mission outlines the organization's purpose, premises, values, and directions. Mission statement answers the question ''what is the organization;s purpose?''for employees, customers, and other constituents. Hence, for effective organizations, the mission statement must be customer-focused, achievable, motivational, and specific.

(3) Goals and Plans

Once the mission statement is formalized, the planning process becomes a parallel flow of goals and plans. The mission statement sets the stage for strategic goals and strategic plans. Top management sets strategic goals. Thy focus on broad, general issues. Strategic goals are achieved through strategic plans. Strategic plans are general plans for allocation of resources, priorities, and necessary actions to reach strategic goals.

Strategic goals and plans serve as inputs for developing tactical goals and tactical plans. Tactical goals are set by middle managers. Their focus is on how to ope rationalize actions necessary to achieve the strategic goals.