To avoid decisional errors in individual decisions, organizations often insist on group decision making. In such cases, individual perception can hardly influence the decisions. Two most widely used techniques for group decision making are: Delphi Group and Nominal Group Method. These we have already explained in chapter 2.
As a rational decision maker, individual employees or managers of any organization, take decisions based on the availability of information and resource support. Hence, such decision maker takes time to ensure flawless informed decision. Rational decision making follow certain steps, and the decision maker, at every step, needs to apply his/her own perceived ideas to ensure that the plan is flawless.
Analysis of Opportunities:
Planning requires analysis of opportunities both within and outside the organization. Opportunities need to be weighed in terms of internal strengths and weaknesses of an organization. Opportunities would decide the business focus or establishment of objectives. To take an example, ITC now considers that the diversification into retail business is an opportunity with the changing market scenario, particularly when their tobacco business is increasingly becoming uncertain with the changing regulatory norms globally.
Second step in the planning process is the establishment of objectives. Objectives specify what is to be achieved. It gives direction to all planning in an organization. While establishing objectives, it is essential to specify them in measurable terms, so as to subsequently ensure the extent of its achievement.
Determining Planning Premises:
Planning premises are assumptions about the environment, which decide the field on which planning is made. It lays down the boundaries. Adequate environment scanning has to be made with the emphasis on economic, social, political, competitor’s plans, government policies and technological factors. Similarly, internal premises, i.e., premises within an organization have to be studied with the focus on organizational policies, resources, strengths and weaknesses.
After such exercise, plans are to be made. Premises, however, are subject to change. This has happened in case of Reliance recently. We all know Reliance has to revise its price tag for mobile services several times within a year. From Rs 10,000, they have now reduced it to Rs 500. Hence, premise control is very important. Most of the organizations make provisions for contingent plan for this.