ADMINISTRATIVE PLANNING OF A COMPANY: CHARACTERISTICS - CULTURE VOCABULARY - 2025

The administrative planning of a company is the determination of a strategy that allows it to achieve its objectives through the optimization of resources. An adequate plan must be flexible and involve all members of the organization. The plan is designed with several time horizons: long, medium and short term.

In administrative planning several stages can be distinguished: carry out a diagnosis of the sector, determine both the mission and vision as well as the objectives, define the strategies, choose the tools, design a monitoring system, implement the plan, evaluate the plan and adapt the plan.

Administrative planning can be strategic, tactical or operational. Each of the areas of the company will have its own plan. Thus, you can find financial plans, marketing plans, production plans, human resource plans, among others.

To carry out administrative planning, the company has several techniques. The best known are the BCG growth-share matrix, Porter's 5 forces model, the product life cycle, PEST analysis, SWOT analysis, and Porter's value chain.

What is the administrative planning of a company?

Administrative planning is the strategy that an organization defines to achieve its objectives. It is a management tool that allows optimizing the use of resources and is aimed at obtaining results.

Plans can be formulated in the short term (less than 1 year), medium term (1 to 3 years) and long term (3 to 5 years).

The three types of plans must coexist and be complementary. In this way, to achieve long-term objectives it will be necessary to establish and overcome immediate and intermediate milestones.

Administrative planning must be a flexible instrument, to be able to adapt to a constantly evolving environment.

For the success of management planning, it is essential to involve the organization at all levels, including from workers to shareholders.

Stages

In administrative planning the following stages can be distinguished:

- Carry out a diagnosis of the sector.

- Determine the mission, vision and objectives.

- Define strategies to achieve these objectives.

- Choose the necessary tools to implement the strategies.

- Design a monitoring system.

- Implement the plan.

- Evaluate the plan.

- Adapt the plan.

The diagnosis allows knowing the market and identifying potential risks; This information will condition planning.

In this stage, all the factors that can influence the company are studied: demography, economy, politics, society, technology, among others.

The mission of a company is its reason for being and marks an achievable goal. On the other hand, the vision is the set of ideals that guide the organization, a utopian end.

The mission of the company must be reflected in a series of concrete objectives, which will help to achieve it. These objectives must be achievable, quantifiable and measurable.

In addition, the organization must define the strategies and tools that will allow it to achieve the objectives. Implementing the plan will require describing the activities and scheduling them according to a schedule.

The necessary resources must be allocated, including personnel, funding and material means. It is also important to identify those responsible for carrying out each action.

To measure the success of administrative planning, indicators are defined to measure the degree of achievement of the objectives.

The plan must be continually reviewed, updated and corrected, to improve it and adapt it to changing circumstances. In case of detecting errors, corrective measures must be designed.

Main types of administrative planning

Depending on its scope, administrative planning can be strategic, tactical or operational.

Strategic planning

It is carried out at the company level and is focused on senior management. This is usually long-term planning.

Tactical planning

It is done at the department level and is aimed at middle managers. The time horizon is the medium term.

The most common subtypes of tactical planning are:

- Financial plan

Through the financial plan, the investment strategies and expenses of the company are designed, and the sources of financing are identified.

- Marketing plan

The marketing plan identifies market opportunities and determines the value propositions that the company will offer. It also proposes the marketing mix (product, price, promotion and distribution).

- Production plan

The production plan determines the lead times, the personnel and material resources required, and the stock level to meet the demand forecasts.

- Human resources plan

The human resources plan determines the recruitment, motivation, communication, direction, compensation, training and evaluation policies that will be followed in the organization.

Operational planning

It is carried out at the section level and is oriented towards operational controls. It is planned in the short term.

Techniques

There are numerous techniques that allow you to carry out proper administrative planning in your company. Some of the most used are the following:

Growth matrix - BCG share

The parent classifies the different activities of the company according to its market share and the growth of said market.

Depending on the position of a certain business within the parent company, the model recommends increasing, maintaining or withdrawing the investment.

Porter's 5 forces model

It allows to evaluate the five factors of influence in a market. These forces are customers, suppliers, substitute products, new competitors, and level of rivalry.

Product life cycle

The product is conceived as an organic element that goes through several phases depending on the volume of sales. These phases are introduction, growth, maturity, and decline.

PEST analysis

Evaluates the impact of the macro environment (economy, politics, society, technology, among others) and the micro environment (customers, suppliers, substitute products and competitors) in the company.

SWOT analysis

Technique that is based on identifying the opportunities and threats that the company faces, as well as the way to face them taking into account its own strengths and weaknesses.

Porter's value chain

It allows to compare the performance of each activity of the company with that of competitors. The goal is to increase the added value offered to customers.

References

1. Aileron. 2011. Five Steps to a Strategic Plan. Forbes. Available at: forbes.com
2. Alonso, M. 2013. Keys for the management of firms and professional firms. Spain: Almuzara.
3. Mata, G. Strategy: The rules of the game in business. Available at: gustavomata.com
4. Silbiger, S. 2013. The Ten-Day MBA. United States: Portfolio.
5. UNESCO. 2010. Strategic Planning: Concept and Rationale. Paris: International Institute for Educational Planning.