The Planning Process

     In this chapter comprehensive planning, which consists of strategic, intermediate, and operational plans, has I been examined. Prime attention was given to long-run considerations, with the observation that most firms tend to be oriented too much toward the short run. The chapter also examined the roles played by the determination of the firm's basic socioeconomic mission, values of the top 'management, and analysis of the organization's strengths and weaknesses in the formulation of the strategic plan. The analysis of strengths requires accurate economic and sales forecasting coupled with a frank, honest evaluation of the company's material resources and personnel competencies. Only in this way can a firm identify a niche and formulate long-range objectives.

     Although the long-range plan provides general direction, the intermediate-range and especially the operational plans are also important because they offer specific direction. The operational plan often consists of derivative functional plans such as marketing, production, and finance plans, designed to attain short-run objectives while harmonizing with the previously determined long-range goals. such short-range plans provide management with a method for gauging progress, serving as a basis from which to adapt or modify current plans and construct future ones.