1. Setting Objectives: The first and foremost step is setting objectives.
Objectives may be set for the entire organization and each department.
2. Developing premises: Planning premises are the assumptions about the
likely shape of events in future. It forecasts the obstacles, problems or
limitations in the path of the effective planning because of which the plans
may deviate. Planning premises supply relevant facts & information relating
to future.
3. Identifying alternative courses of action: Once objectives are set and
premises are developed, the next step would be to act upon them. All the
alternative courses of action should be identified.
4. Evaluating alternative Courses: The next step is to weigh pros and cons
of each alternative. Each course will have many variables which have to be
weighed against each other. Example: Cost-Benefit analysis.
5. Selecting an alternative: After comparison and evaluation, the best
alternative is chosen for reaching organizational objectives. On the basis of
merits, demerits, resources and consequences, the best plan has to be
adopted, which must be the most feasible, profitable and with best negative
consequences.
6. Implementing the plan: Once the plans are developed they are put into
action. Successful implementation of the plan ensures understanding and
whole-hearted cooperation of all the employees.
7. Follow up action: To see whether plans are being implemented, activities
are performed according to schedule. In case of any deviations, changes
are made in the plans.
