Question

Two years ago Madhu completed her degree in food technology. She worked for sometime in a company manufacturing chutneys, pickles and murabbas. She was not happy in the company and decided to have her own organic food processing unit for the same. She set the objectives and the targets and formulated action plan to achieve the same.

One of her objective was to earn 10% profit on the amount invested in the first year. It was decided that raw materials like fruits, vegetables, spices etc. will be purchased on three months credit from farmers cultivating organic crops only. She also decided to follow the steps required for marketing of the products through her own outlets. She appointed Mohan as a Production Manager who decides the exact manner in which the production activities are to be carried out. Mohan also prepared a statement showing the number of workers that will be required in the factory throughout the year. Madhu informed Mohan about her sales target for different products, areawise for the forthcoming quarter. While working on the production table a penalty of Rs 100 per day for not wearing the caps, gloves and apron was announced. Quoting lines from the above para identify and explain the different types of plans discussed.

Answer 1

Types of plans being discussed in the given paragraph:

1. Objective: An objective broadly outlines the key task or target to be reached at the end of a certain time period by the organisation. In the given case, the objective is highlighted in the words ‘One of her objectives was to earn 10% profit on the amount invested in the first year’.

2. Policy: A policy is a code of conduct to be followed by a particular organisation in a particular scenario. It is not specific and hence is interpreted according to the situation. In the given case, the lines ‘raw materials like fruits, vegetables, spices etc. will be purchased on three months credit from farmers cultivating organic crops only’ highlights a policy.

3. Procedure: A procedure comprises guidelines to be followed in a specific order to make a policy decision to come into reality. In the given case, the line ‘Decide to follow the steps required for marketing of the products through her own outlets’ highlights the procedure to be followed.

4. Method: A method is a specific process to be conducted to carry out a desired task. In the given case, the method is highlighted in the words ‘the exact manner in which the production activities are to be carried out’ highlight the type of plan called ‘method’.

5. Rule: A rule is a type of plan which mentions the exact way of completing a particular task and its degree of compulsion. A rule can also be negative and guide the employees about not doing a particular thing. In the given case, the line ‘Penalty of Rs 100 per day for not wearing caps, gloves and aprons was announced’ highlights a rule.

6. Budget: A budget is usually a number which specifies the financial constraints and targeted achievements on an organisation. It mentions the upper limit of the expenditure of resources. In the given case, the line ‘Mohan also prepared a statement showing the number of workers which will be required in the factory throughout the year’ implies a budget.