Long Answer Questions: Planning | Business Studies (BST) Class 12 - Commerce PDF Download

Q1: Explain "Objective" and "Policy" as types of plan using suitable examples.
Ans: Objectives: Objectives are the specific, measurable ends that an organisation aims to achieve. They give direction to all activities, act as a basis for planning and control, and are usually time-bound. Objectives should be clear, realistic and stated in quantifiable terms so progress can be measured. For example, a firm may set an objective to increase sales by 20% during the next financial year. Objectives help coordinate effort, motivate employees and provide standards against which performance can be evaluated.
Policy: A policy is a broad guideline that directs decision making and behaviour within set limits. It provides a framework for managers and subordinates to take consistent decisions without referring every matter to top management. Policies give practical shape to objectives by indicating how goals are to be achieved. For example, a company may have a credit policy that specifies terms for extending credit to customers, or an HR policy that sets rules for leave approval. Policies reduce uncertainty, ensure uniformity and enable decentralisation by defining acceptable boundaries for action.

Q2: What are the main points in the definition of planning?
Ans:  In the words of Koontz and O'Donnell, planning is deciding in advance what to do, how to do it, when to do it and who is going to do it. Planning bridges the gap between the present and the desired future position. The main points involved are:

• Setting objectives - Deciding clear and measurable goals that the organisation wishes to achieve.
• Time period - Establishing the time frame within which the objectives are to be achieved, for example short-term or long-term plans.
• Formulating alternative courses of action - Developing different methods or options to reach the objectives so that there are choices available.
• Selecting a course of action - Choosing the most feasible and effective alternative after evaluating risks, costs and benefits.

Q3: Defining 'organizational objectives' as the first step in the process of planning. Explain in brief the other steps of this process.
Ans:  The first step in the planning process is to establish objectives. Objectives should be clear, realistic and specific about what is to be accomplished. The further steps in the planning process are:

• Establishing Planning Premises: Planning premises are the assumptions or forecasts about future conditions in which plans will operate. They include expectations regarding the economy, government policies, market demand, prices and preferences. Premises provide the factual basis on which plans are developed.
• Identifying the Alternative Courses of Actions: Based on the objectives and premises, planners identify different possible ways to achieve the goals. This requires creative and logical thinking to open up various options for the organisation.
• Evaluating the Alternative Courses: Each alternative is examined for its advantages and disadvantages. Feasibility, cost, time required and likely effectiveness are considered to assess how well an alternative will help achieve the objective.
• Selecting the Best Alternative: After evaluation, the most suitable and efficient alternative is chosen - the one that maximises output or benefit while minimising cost and risk.
• Implementing the Plan: The chosen plan is put into action by assigning responsibilities, allocating resources and coordinating activities. Implementation turns plans from ideas into concrete actions.
• Follow-up Action: Planning does not end with implementation. Continuous monitoring and review are necessary to check progress, compare actual results with planned targets and make corrective adjustments if required.

Q4: State any three limitations of planning.
Ans: Some limitations of planning are as follows

• Planning Reduces Creativity: Excessive emphasis on fixed plans may limit initiative among managers and staff, because everyone follows pre-set directions and may not look for better or innovative ways of doing things.
• Planning May Not Work in a Dynamic Environment: Planning is based on forecasts of the future. When the environment changes rapidly or unpredictably, plans can become obsolete quickly and may fail to cope with new conditions.
• Planning Involves High Costs: Effective planning requires time, information gathering, analysis and participation of specialised personnel. These activities raise the cost of planning and may be burdensome for organisations with limited resources.

Q5: 'Mrs Renu Natrajan', the Principal of Prince Public School' appointed Mr Sansar Chand as the coach for football team which was to play the final match in the State-Level Tournament. During training the coach inspired the players to make up their mind to win the match in all circumstances. Also he stressed that they had to win the match with the difference of at least five goals from the losing team. He explained special methods to the players for playing both offensive and defensive game. Also he told them how after beating the opponents, football would be passed from one player to the other until it reached the goal box of the opposite team. At the end of the training, the coach warned all the players against misbehaving with any of the players of the opposite team, otherwise, they could be punished.

• Identify the concept of the planning functions of management described in the paragraph given above.
• Explain the four types of concept identified in point 6a ' by quoting the relevant lines.

Ans: The paragraph illustrates several kinds of plans used in management: objectives, methods, procedure and rules. Each is explained below with the relevant line(s) quoted from the paragraph.

• Objective: An objective is a specific target to be achieved. Relevant lines: "During training the coach inspired the players to make up their mind to win the match in all circumstances." and "Also he stressed that they had to win the match with the difference of at least five goals from the losing team." These sentences show both a general aim (to win) and a specific, measurable objective (win by at least five goals).
• Methods: Methods are the techniques or approaches to carry out tasks. Relevant line: "He explained special methods to the players for playing both offensive and defensive game." This indicates the coach taught particular ways of playing to achieve the objective.
• Procedure: A procedure is a sequence of actions to be followed. Relevant line: "Also he told them how after beating the opponents, football would be passed from one player to the other until it reached the goal box of the opposite team." This gives a step-by-step way to move the ball towards the goal.
• Rule: A rule is a strict regulation that must be followed, often with penalties for violation. Relevant line: "At the end of the training, the coach warned all the players against misbehaving with any of the players of the opposite team, otherwise, they could be punished." This sets a clear rule and consequence to ensure discipline.