1. Management functions Planning
Determining the organization’s goals and defining the means for achieving them.
It is preparing for tomorrow, today.
Objectives must be SMART.
Planning seeks to answer What needs to be accomplished, When, Where, Who and How

2. Significance of planning
Gives direction to the organization
Establishes a basis for teamwork and guides entire organization towards working as a system
Lowers management’s threshold to change.
Helps to foresee problems and cope with change.
Affords managers the opportunity to adjust the organization to the environment instead of just reacting to it.
Helps map the organization’s future.
Serves as a prerequisite to employing all other management functions.

3. Internal Limitations to planning
brings about rigidity, ie, strict adherence to policies.
It is expensive in terms of time, finance and effort
full of uncertainty since it is based on estimates about the future
Gives a false sense of security.
Planning can be misleading as it can be used to serve individual interests.

4. External Limitations to Planning
Change of government policies
Labour unions invoked industrial actions.
Technological changes.
Competitors’ policies.
Natural disasters.
Changes in demand and prices..

5. The planning process
Planning is an on-going procedure consisting of the following;
1. Setting objectives
Analyzing and evaluating the environment
Determining and evaluating alternatives
Implementing the plan
Controlling and evaluating results

6. The planning process 1. Setting objectives
This involves deciding on a target for the organization.

7. The planning process cont...
Analyzing and evaluating the environment
Looking at the internal and external environment of the company to establish its strengths and weaknesses as well as opportunities and threats.

8. The planning process cont...
Determining and evaluating alternatives
Analyse the available courses of action and select the best.

9. The planning process cont...
4. Implementation of the plan
After selecting the best alternative, decide who will do what; assemble required resources and set deadlines then put ideas into actions.

10. The planning process cont...
 5. Controlling and evaluating results
monitor the progress that is being made
evaluate reported results and make any necessary modifications.
See if the plan is making progress..

11. Environmental scanning (PEST analysis)
This is the measurement, projection and evaluation of change in the different environmental variables.

12. Political variables
Government affects business environment in a regulatory capacity such as;
Pricing policies
Taxation laws
Investment laws
property rights

13. Economic variables
These are financial or fiscal related variables that influence the survival of the organization and its community e.g;
Economic growth rate
Levels of inflation, exchange and interest rates
Infrastructure quality
Employment levels and labour costs
Dispensable income
Income distribution

14. Social variables
The shared way of life whereby consumers’ life-styles, habits, norms and values are formed and agreed upon by society, e.g;
Population size and its growth rate
Cultural / religious values
Entrepreneurial spirit
Leisure interests
Pressure groups.

15. Technological variables
These are innovation related changes.
Technology’s impact on product offering
Impact on cost structure
N.B. Most macro environmental factors are country specific.

16. The SWOT analysis
This is a strategic planning method used to evaluate Strengths, Weaknesses, Opportunities and Threats of a business venture.
It provides information helpful in matching the organization’s resources and capabilities to the competitive environment in which it operates.

17. SWOT analysis Internal variables Strength Weaknesses
External variables Opportunities Threats
Accept they exist
Have courage to change

18. Strengths
An achievement or attribute that puts the company in a position of market advantage
It is the in-house talent, eg;
Technical knowhow
Strong brand names / Superior product
Good reputation among customers
Exclusive access to high grade natural resources.

19. Strengths cont... Patent protection In-house R & D facilities
Wider product line than rivalries
Alliances with suppliers

20. Weaknesses What a company lacks or does poorly. Examples are:
Lake of patent protection
Weak brand name
Poor reputation among customers
High cost structure
Lack of talent and RnD facilities.
Too narrow a product line relative to rivalries
Weak balance sheet burdened with debt

21. Opportunities cont...
These are conditions outside the organization that can be exploited for its growth.
Examples are
Removal of international trade barriers
Introduction of new technology
Increase in demand for a product or service already on offer by an organization.
Companies seeking partnerships
Competitors’ problems
An unfulfilled customer need

22. opportunities
“Where others see disasters and problems, I see opportunities, even when I diversify I remain focused. ...my mother taught me to be astute and to be an entrepreneur from pamusika, the vegetable market, and as a tonic”, he adds, “...my father taught me to cast my views and to stay focused, that is me” (Phillip Chiyangwa Sunday Mail 2 February 2013)

23. Threats
These are external unfavourable developments that may weaken an organization’s position.
Examples are:
Competitors’ positive policies
Economic instability of a country
New entrants into the business.
Decrease in product/service demand
General political instability of a country
Unfavourable weather conditions