Elements/components of planning:

The subsidiary plans and programmes on which a planning is based are called elements of planning.

The elements of planning are discussed below:

1. Objectives:

• All the plans of a business unit are based on the objectives they wish to achieve.
• So, it is important that the managers consider all the factors affecting business while drafting the plans.
• Such objectives should be set which are realistic and achievable.

2. Strategy:

• A plan of action designed to achieve a pre-decided long-term or overall aim is called a strategy.
• Strategy formation helps the business unit to be capable enough to face the competition or to survive against the other factors.
• Strategy should be kept confidential from the competitors.
• A well-defined strategy can surely lead to success.

3. Policy:

• The decisions and strategies that the management decides for accomplishments of objectives are known as policies.
• The type of policy framed by the business unit reflects the idea of efficiency and working style of the business unit.
• Just like an objective, the policy should also be pragmatic and real.

4. Method/Procedure:

• The business units develop various methods or procedures to conduct business activities.
• Method guides the best way for accomplishing pre-determined objectives as well as doing tasks.

5. Rules:

• Framing rules is extremely important to accomplish the functions of planning.
• Rules decide the procedure and give the clear understanding.
• They also ensure that discipline will be followed in the unit among the employees.
• Through proper observance of rules it becomes easy for the unit to accomplish the objectives. For example the rule of prohibiting the use of mobile during working hours helps to increase efficiency of employees.

6. Budget:

• Budget is a tool that controls the outcomes and helps accomplishing business objectives.
• A unit prepares different types of budget such as capital expenditure budget, sales budget, production budget, production cost budget, cash budget, etc.
• Budget helps to control the business activities and also to increase the efficiency of management. s

7. Programme:

• The sequence of activities undertaken by a business unit to accomplish a task is called programme.
• If the work is done according to programme then the objectives can be fulfilled without any confusions or hindrances.
• The management sees to it that the work is done as per the programme as well as per the standards set. Corrective measures are taken in case if there are deviations.