A Concept Which Says That Plans Should Extend Far Enough To Meet Commitment Made When The Plans Were Developed True Or False

This statement is “True” and this concept is called "Commitment Concept".

Explanation of True And False Question

Three Contingency Factors, which affect the developing plans, are shown below:

(a) Commitment Concept

This concept shows that plans should be extended far enough to fulfil the commitments made for these plans. The time frame for plans should be neither too short nor too long, so that required commitment is met and organization goals are achieved efficiently and effectively.

Commitment concept is one of the contingency factors which affects the process of developing plans. For example, an organization show its commitment for a long period of time such as 15 years in order to become market leader when the managers planned at the starting stage of its developing.

(b) Organizational Levels

There are three organization levels called Upper-level, middle-level and lower-level. At lower-level, the managers make operational planning. At middle-level, the middle managers give reports about the strategic planning to lower-levels and operational planning to top-level of the organization. At upper-level, the strategic planning is made by top managers.

(c) Existence of Environmental Uncertainty

In case of environmental uncertainty such as economic instability, natural uncertainty like floods, earthquakes, etc., the managers need to plan accordingly. So, he needs to develop specific but flexible plans so that the plan should be able to meet goal. For example, in case of depression period of economy, the managers may change the plan of making high investments in the project to low investments with calculated risk.

Approaches To Planning

There are two approaches to planning which are explained below:

(i) Traditional Approach

Under this approach, the planning is taken place at top-level and flow down to all organizational levels. A formal planning department assists the top management in forming plans. Such department consists of specialists who have sole responsibilities in developing the organizational plans.

Advantages of This Approach

(i) Specific And Coordination

Under this approach, the specific plans are set by top-level managers which flows down to entire organization as the collective efforts of each business units. Each organizational level, the plans are prepared according to the needs of each business unit. For example, the top-level managers make a strategic plan that work quality should be improved by hiring qualified staff and such plan flows down to each business unit and they coordinated with each other to achieve ultimate goals i.e., at lower-level, the lower-level manager such as human resource manager hire qualified staff to improve quality work at lower-level which ultimately helps in improving overall quality work of the organization.

(ii) Easy To Follow

Under this approach, the plans are written documents which provide specific guidelines to employees to achieve targets. So, it becomes easy for them to follow the plan set by top management

(iii) Improved Performance

The employees follow written procedures to achieve goals, so they more focus on the work, which increases their working performance.

Disadvantages of This Approach

(i) Out-dated Plans

The top-level managers should update the plans for which the organization members work on. For example, if the old plan is not to use latest technology in the organization but due to dynamic environment, the top-level managers should change it and use latest technology for achieving better results.

(ii) No Participation of Members

Top-level managers should allow team members to help themselves in forming a good plan by giving their suggestions and recommendation in order to achieve targets.

2. Participation Approach

Under this approach, the team members and various work units are allowed to form plans according to their specific needs.

Advantages

(i) Flexible

As plans are flexible, so member and work units spread at various organizational levels don’t need to follow specific processes or guidelines to achieve targets. The work units make their own and working environment required under their specific needs.

(ii) Participation And Mutual Agreement

Every team member can take participation in making plans to achieve common goals. They agree on set plans.

(iii) Quality Work

Due to mutual agreement on making plans, they work collectively and coordinate with each other in achieving results.

Disadvantages

(i) No Specific Guidelines

Due to lack of specific system and guidelines, the work coordination becomes difficult unless the members agree on some processes or guidelines

(ii) Delay In Developing Plans

As each member is allowed to participate and agree on the plan, so it takes some time to set an agreed plan.