Business planning process
After making the list of various alternatives along with the assumptions supporting them, the manager starts evaluating each and every alternative and notes down the position and negative aspects of every alternative. After this the manager starts eliminating the alternatives with more of negative aspect and the one with the maximum position aspect and with most feasible assumption is selected as best alternative. Alternatives are evaluated in the light of their feasibility.
The best alternative is selected but as such there is no mathematical formula to select the best alternative. Sometimes instead of selecting one alternative, a combination of different alternatives can also be selected. The most ideal plan is most feasible profitable and with least negative consequences.
After preparing the main plan, the organization has to make number of small plans to support the main plan. These plans are related to performance of routine jobs in the organization. These are derived from the major plan. So, they are also known as derivative plans. These plans are must for accomplishing the objective of main plan. The common supportive plans are plans to buy equipment, plan for recruitment and selection of employees, plan to buy raw material.