Question

In which step of planning process the planners make predictions and assumptions regarding future?

Answer 1

Establishment of Planning Premises

• Planning premises are the assumptions about the lively shape of events in future.
  
• They serve as a basis of planning.
  
• Establishment of planning premises is concerned with determining where one tends to deviate from the actual plans and causes of such deviations.
  
• It is to find out what obstacles are there in the way of business during the course of operations.
  
• Establishment of planning premises is concerned to take such steps that avoids these obstacles to a great extent.
  
• Planning premises may be internal or external. Internal includes capital investment policy, management labour relations, philosophy of management, etc. Whereas external includes socio- economic, political and economical changes.
  
• Internal premises are controllable whereas external are non- controllable.