Notes On Corporate Planning In An Organization:

       Corporate Planning refers to the plan formulated by the corporate enterprises for its survival and growth. It is neither possible to predict future nor control it. As such, the management of an enterprise needs to have to clarify their objectives and determine:

  1. The action that needs to be taken
  2. The time when such action is necessary to be taken
  3. By whom the action is to be taken
  4. The probable cost of taking the action.

       Corporate planning deals in finding out the solutions of these subject matters.

       In 1968, John Argenti, defined Corporate Planning as, "It is to determine the long term goal of the company as a whole and then to generate plans designed to achieve the goals bearing in mind the probable changes in its environment."

       An analysis of the following defination reveals the following features of the corporate planning:

  1. It helps to determine the long term goals of the company.
  2. It helps to formulate plans to achieve the goals.
  3. It takes into considerations the environmental changes

       The process of corporate planning covers the following areas of business:

  1. Location, layout and size planning
  2. Production planning
  3. Organisational planning
  4. Divisional Planning

       The staff of the corporate planning is divided into two groups:

  1. Central Planning Group and
  2. Divisional Planning Group

       The central planning group guides the activities of the divisional planner and submits the divisional plans in front of the Top Management for its scrutiny final approval.

Steps of Corporate Planning:

       Corporate Planning is a must not only for a newly established firm but also an ongoing concern.

       The following steps are involved in the process of corporate planning:

1. Environmental Analysis:

       The first step in the corporate planning process is the analysis of the business environment. Here analysis of environment refers to:

  1. Technical Environment.
  2. Socio-Political Environment.
  3. Natural Environment.
  4. Economic Environment.
2. Setting of Objectives:

       The second step in the process of corporate planning is to set up both short term and long term objectives for the organisation. While, the fundamental objectives of the organisation are survival and growth, goals on the other hand refer to the targets that are to be achieved within the stipulated time frame. Goals may be established for earning of profits, achieving the sales target, acquisition of assets etc. The goals of the firm may change over time, the basic objectives of the firm remains the same.

3. Developing Strategies:

       The third step in the process of corporate planning is to develop strategies for the achievement of organisational goals and objectives. Strategies may be framed for recruitment, selection, training and promotions of staff, procurement and administration of funds, production and distribution of goods and so on. Development of strategies requires care and cautions and the corporate planners need to have those for formulation of successful, strategies.

4. Procedures and Programmes:

       The next step in the process of corporate planning is to develop procedures and programmes for the performance of the activities. For this, all the activities of the organisation are sub-divided into smaller activities. The powers, duties and responsibilities are delegated to the subordinates. The top management looks after the performance of the middle management and the middle management supervises the performance of the lower level or the working personnel. All these ensure sound implementations of the organisational plans and policies.

5. Reviewing the Plan:

       Management must review the organisational objectives, policies and procedures of the organisation form time to time in the light of the changed economic and business situation. Corporate plans should therefore be flexible to help infuse changes in the light of the changed situation otherwise it may be detrimental to the very interest of the firm.