Most Important Case Study Questions of Planning
Q1. Tata started offering a discount of Rs. 11,000 on purchases from India. In response to this, Maruti started with a scheme of free DVD players with every Wagon R.
Identify the type of plan highlighted in the given statement.
Ans. Strategy.
Q2. Identify the type of plan in the following statements:
(a) They are ends that the organization wants to achieve by its operations.
(b) Girls will be given a rebate of 5 percent cut off for admission to the college.
(c) It facilitates the comparison of actual results with the planned results.
(d) The library will issue at one time only 4 books for 15 days
(e) Any employee found logging into any social networking site in the office will be punished.
(f) Coca-Cola reduces the prices of its products in response to the price cut by Pepsi.
Ans. (a) Objectives (b) Policy (c) Budget (d) Policy (e) Rule (f) Strategy
Q3. Verma Ltd. Has to develop its organizational plan for the coming year. For this purpose, the company hires professionals from Singapore. Huge money is incurred on their fees, collection of data, surveys, etc. This entire process of planning has already proved to be a very costly affair and the total cost may exceed the benefits derived from the plan.
(a) Should Verma Ltd. Continue with existing planning? Why?
(b) Which limitation of planning is highlighted in this case? Explain it.
Ans. (a) No, it should stop because the cost of planning is likely to exceed the benefits expected from it.
(b) Planning involves huge costs.
Q4. The workers of a factory are planning to go on strike. Suppose you are the production manager and somehow, the plan of strike has reached your ears.
How will you provide for such apprehension in the planning process?
Ans. As a production manager, I will consider the possibility of a worker’s strike under ‘Planning Premises.’ If the workers go on strike, the production targets will not be achieved. So I will take the following steps to avoid the threat of a strike.
(a) I will find out the worker’s grievances.
(b) I will provide for the genuine demands of the workers in the plan.
(c) if their demands are not genuine, I will convince them of the reality and bring them around in favor of the company.
Q5. An electronic company ABC Ltd. Is facing the problem of declining market share due to increased competition from other new and existing players in the market. Its competitors are introducing lower-priced models for mass consumers who are price-sensitive. For quality-conscious consumers, the company is introducing new models with added features and new technological advancements.
Name the type of plan the company is preparing. Identify the steps involved in such a plan.
Ans. The type of plan required to be prepared under this situation is ‘strategy’.
The steps involved in preparing this plan are:
(a) Determining Long-Term Objectives: the company may set up a long-term objective of capturing more and more quality-conscious consumers.
(b) Adopting a particular Course of Action: The company must import the latest technology or spend more on the R and D department to innovate the latest technology to make their goods superior then those of the competitors.
(c) Allocating Resources Necessary to Achieve the Objectives: The company must allocate extra funds to their research and development and appoint people with the latest knowledge to innovate new technology.
Q6. Grover Ltd. Has a plan to increase profits by 25%. For this, it has incurred a lot of time and money. However, the competition started increasing, so it could not change its plan to beat its competitors because a huge amount of money had already been spent on the pre-decided plan. It caused losses to the company.
Identify and explain any two limitations of planning highlighted in the above case by quoting the lines.
Ans. (a) Planning is a time-consuming process. It also involves huge costs.
‘For this, it has incurred a lot of time and money.’
(b) Planning leads to rigidly. Following a pre-decided plan, when circumstances change, may not turn out to be in the organization’s interest.
‘The competition starts increasing, so it could not change its plan to beat its competitors because a huge amount of money had already been spent on the pre-decided plan.’
Q7. In, Chak De India’s movie, Shahrukh Khan becomes the coach of the girl’s hockey team. He knows he has to prepare the girls for the international hockey matches and bring the World Cup after winning. For this, he prepares a long-term plan and thinks the way how to beat the competitors. He coaches the girls to play in different ways like defensive, offensive, etc. At the outset of a match, he explains who will open the match, and how the ball will be passed from one player to another step by step.
Identify the different types of plans by quoting the lines from the above para.
Ans. (a) Objective
‘…. Bring the World Cup after winning.’
(b) Strategy
‘For this, he prepares a long-term plan and thinks the ways how to beat the competitors.’
(c) Method
‘He coaches the girls to play in different ways like defensive, offensive, etc.’
(d) Procedure
‘At the outset of a match, he explains who will open the match, and how the ball will be passed by one player to another step by step.’
Q8. New-Generation Limited is a company manufacturing garments. While making its plan, the company takes into consideration the business environment. It constantly adapts itself to changes in the environment by making changes in its plan. However, it becomes difficult for the managers of the company to accurately foresee future trends in the environment. Competition in the market upsets its financial plan; then sales targets have to be revised and, accordingly, cash budgets also need to be modified since they are based on sales figures.
(a) Name and explain the limitation of planning highlighted in the above para.
(b) Identify and explain the two types of plans mentioned in the above para by quoting the lines from it.
Ans. (a) Planning may not work in a dynamic environment.
(b) (i) Strategy
‘While making its plan, the company takes into consideration the business environment.’
(ii) Budget
‘Competition in the market upsets, its financial plans; the sales targets have to be revised and, accordingly, cash budgets also need to be modified since they are also based on sales figures.’
Q9. At what stage of the planning process feasibility and consequences of an alternative course of action is checked? Identify the step and explain the next step followed by the above.
Ans Evaluating alternative courses of action.
Selecting an alternative.
Q10.Recently, a well-known company has launched drinks of 10 different categories like Lichi, Nimbu Pani, Jaljeera, Aam Panna, etc. to beat its competitors. After taking this step the company’s profits and market share starts increasing rapidly. Mr. Monu, the marketing manager of the company suggest the idea of launching new drinks for the growth and prosperity of the business.
(a) Identify and explain the type of plan highlighted in the above case.
(b) Identify the importance of planning mentioned in the above case by quoting the lines.
Ans. (a) Strategy
(b) Planning Promotes innovative ideas.
‘Mr. Monu, Marketing Manager of the company suggests the idea of launching new drinks for the growth and prosperity of the business.’
Q11. Sandeep Ltd. Believed that the phrase failing to plan is planning to fail. Therefore, the top management always advocated for its subordinates to plan for success.
The junior managers followed the advice and made monthly, quarterly, and yearly plans. Everyone in the company was told to follow the detailed plans. After three months, it was found that the company had lost several orders. It was found that clients had demanded a 13% discount as compared to the 10% discount offered by the company but the salespersons refused them. No new suggestion came in this period for improving sales of the company. The company decided to rely on its tried and tested channels of selling through two-level channels.
However, sales managers were finding it difficult to obtain orders as other firms were using e-tailing and m- m-tailing to attract customers.
Identify and explain the limitations of planning highlighted in the above case which are responsible for the lack of success of Sandeep Ltd.
Ans. (a) Planning leads to rigidity.
(b) Planning may not work in a dynamic environment.
(c) Planning reduces creativity.
(d) Planning does not guarantee success.
Q12. Forever Ltd. Is a product leader of the electronic world. It deals in all types of electronic devices. It is afraid of declining market share due to increased competition from other new and existing players in the market. After considering this warming signal, it has decided to shift from the image of being a market leader to a product leader. For this, they have to involve new dimensions in their products and have to take first mover advantage. For this, the CEO of the company has kept meeting and asking their managers to brainstorm and give productive suggestions. It also involved lower-level employees to find out the technical feasibility of ideas suggested by them. After the whole exercise, they came up with one innovative idea of manufacturing ONE TOUCH FREEZER ONE TOUCH REFRIGERATOR- a revolutionary smart convertible refrigerator with just one touch of a button we can utilize empty freezer space by converting it into a refrigerator. The CEO of the company appreciated it and decided to raise extra money from the capital market for this purpose.
(a) Name the type of plan the company is preparing. Also, name the steps that the company follows to implement this plan quoting the lines from the above para.
(b) Identify and explain the importance of planning highlighted in the above case.
Ans. (a) Strategy
Steps which the company follows to implement this plan are:
(i) Determining Long Term Objectives.
‘…it has decided to shift from the image of being a market leader to a product leader.’
(ii) Adopting a particular Course of Action
‘After the whole exercise, they have come up with an innovative idea of manufacturing ONE TOUCH FREEZER ONE TOUCH REFRIGERATOR – a revolutionary smart convertible refrigerator by just one touch of a button we can utilize empty freezer space by converting it into a refrigerator.
(iii) allocating Resources Necessary to Achieve the objectives.
‘The CEO of the company decided to raise extra money from the capital market for this purpose.’
(b) Planning promotes innovative ideas.
Q13. Association of Commerce Teachers (ACT) is a non-profit making, self-reliant, and voluntary organization established with the chief objective of professional excellence of the commerce teacher’s fraternity. Mr. Gurpreet, Chairperson of this organization has decided to introduce the Commerce Olympiad at the school level to promote learning and applications of commerce. For this, he has prepared long-term plans and discussed with other members different ways to make it successful. In meetings, he has discussed in detail the outline of this idea and explained to everyone about disciplines involved in the paper, the weightage of topics, the time to be allocated, the evaluation system, etc. They have also estimated in advance the cost and time required to make this idea a reality.
Identify the four types of plans that are highlighted in the above case, quoting the lines from it.
Ans. (a) Objective
‘Mr. Gurpreet, chairperson of this organization has decided to introduce Commerce Olympiad at the school level to promote learning and application of commerce.’
(b) Strategy
‘For this, he has prepared long-term plans.’
(c) Method
‘….. and discussed with other members different ways to make it successful.’
(d) Budget
‘they have also estimated in advance the cost and time required to make this idea a reality.’
Q14.If you fail to submit your homework for the third time in succession you will be required to pay a fine, stay back, and complete your homework. What type of plan is it?
Ans. Rule
Q15. Employees of Savita Ltd. Are directed to strictly follow the plans formulated by the top management. No employee representative in the team prepares plans for the organization. Name and explain the limitation of planning indicated here.
Ans. Planning reduces creativity.
Q16. ‘To increase awareness of the company’s products in the market and customers, Mr. Harsh the CEO has decided to advertise in all the leading newspapers in every state of India for the Next four months.’ Identify and explain the type of plan highlighted by this statement.
Ans. Strategy
Q17. ‘Those employees who are eligible for promotion have to appear for an internal written test and an interview.’ Identify and explain the type of plan reflected here.
Ans. Procedure
Q18. The ‘Le Meridian’ hotel has decided to employ female staff for handling kitchen affairs and male staff for marketing issues. Identify and explain the type of plan highlighted by this statement.
Ans. Policy.
Q19. ‘As part of the training program for newly appointed sales executive career Ltd. Fixes the responsibility of sales managers as mentors to take the executives for a visit to their some existing customers and help them to learn the skills required to do the job.’ Identify and explain the type of plan highlighted by this statement.
Ans. Method
Q20. Vivaan is a Marketing Head at Desire Ltd. He prepares sales targets for the upcoming year. For this, he analyzes the previous year’s sales data, the growth trend of the company, market demand, competitor’s strategy, etc. Which characteristic of planning is highlighted here? Explain it.
Ans. Planning is a mental exercise.
Q21. Lakshay, Production Manager of Future Ltd. Is planning to install a new machinery for increasing production capacity. He compares various models and brands of machinery available. He also discusses with supervisors, and workers, and compares the initial cost, maintenance cost, and other overheads before making a final decision about the machinery to be installed.
Identify and explain the step of the planning process performed in the above para by quoting the lines from it.
Ans. Evaluating alternative courses.
‘He compares various models and brands of machinery available. He also discusses with supervisors, and workers, comparing initial cost, maintenance cost, and other overheads before making a final decision about the machinery to be installed.’
Q22. Peter Ltd. has imported its raw materials from Iraq for five years. But now there is a change in the government and the new government imposes a ban on imports from Iraq. All plans of Peter Ltd. Regarding import from Iraq have failed. The company looks for another source to obtain the raw material.
Identify and explain the limitation of planning highlighted in the above case.
Ans. Planning may not work in a dynamic environment.
Q23. Siddhart, a supervisor in a factory is given a pre-determined production schedule and the method to be followed. Siddharth knows that if one more worker is employed the productivity will improve but he does not act as the production manager has told him to do a pre-planning.
Identify and explain the limitation of planning highlighted in the above para.
Ans. Panning reduces creativity.
Q24. Rahul, a worker, is given a target of assembling two computers per day. Due to his habit of doing things differently, an idea struck him, which would not only reduce the assembling time of computers but would also reduce the cost of production of computers. Rahul’s supervisor, instead of appreciating him, ordered him to complete the work as per the methods and techniques decided earlier as nothing could be changed at that stage.
The above para describes one of the limitations of the planning function of management. Name and explain the limitations
Ans. Panning reduces creativity.
Q25. Mr. Gaurav, the Managing Director of ‘Yes We Can Ltd.’ Called a meeting of the managers of all the departments. The following issues have been taken for discussion in the meeting:
(a) Which source of recruitment of employees should be preferred – internal or external?
(b) How should the employees be promoted- based on performance or age?
(c) On what basis should the employees be transferred?
Identify and explain the type of plan highlighted in the above description.
Ans. Policy
Q26. ABC Ltd. Gave its sales Executive the difference that they could sell the goods on credit. Also, it told them very clearly to inform the customers that if up to one month, they did not make the payment, after the completion of this period, they would have to pay interest for the whole period at the rate of 12% per annum.
Identify and explain the types of plans mentioned above by quoting the lines.
Ans. (a) Policy
‘A company gave …. Sell the goods on credit.’
(b) Rule
‘If up to one month …… interest for the whole period at the rate of 12% per annum.
Q27. ABC Ltd. A mobile company is facing a problem of declining market share due to increased competition from existing and new players in the market. The competitors are introducing low-priced models for price-sensitive consumers. At the same time, for quality-conscious customers, the competitors are introducing new models with added features.
Identify and explain the type of plan ABC Ltd. It should be used to gain its market share.
Ans. Strategy
Q28. Nidhi bought a vacuum cleaner from an authorized dealer of a company. While using it she identified a defect in the product. She went to return it to the dealer the next morning. At the shop, it was written that “Np products will be returned before 2 pm.”
Identify and explain the type of plan highlighted in the above case.
Ans. Rule
Q29. ABC Ltd. An electronics goods manufacturing company decided to close down its customer care service cell in Chandigarh because of the adverse business environment. However, it also wants to expand its services at Gurgaon Center.
The company needed 200 additional trained employees at the Gurgaon center. The top management of the company based its decision on the stability provided by the new government, the positive attitude of newly elected representatives in government, the strengthening of the dollar, no drastic change in tax rates in the next financial year, etc.
The top management identified that they could shift employees from Chandigarh to Gurgaon, hire new candidates directly from universities, or contact a human resources agency.
(a) which function of management was performed by the top management?
(b) Identify the steps of the function that have already been performed by quoting the lines from the above case.
(c) State the other two steps followed by the above to be taken by the top management.
Ans. (a) Planning
(b) (i) Setting objectives- ‘However, it also wants to expand its services at Gurgaon center.’
(ii) development Premises- ‘The top management of the company based its decision on stability provided by the new government, positive attitude of newly elected representatives in governments, strengthening of the dollar, no drastic change in tax rates in next financial year, etc.’
(iii) Identify Alternative Courses of Action- ‘The top management identified that they could shift employees from Chandigarh to Gurgaon, hire new candidates directly from universities, or contact a human resource agency.’
(c) (i) Evaluating alternative courses of action.
(ii) Selecting an alternative.
Q30. The CEO of ABC Ltd. An automobile company dreams of his company becoming the best player in the future, for which he sets the objectives, forecasts the future and develops various courses of action.
(a) Identify the management function which is highlighted here.
(b) What are the various values the CEO is striving to achieve?
Ans. (a) Planning is the management function
(b) the values highlighted in the above-mentioned paragraph are:
(i) Hard work helps individuals to turn their dreams into reality.
(ii) Initiative, confidence, commitment
Q31. On a visit to a restaurant, some youngsters were found smoking despite a sign board indicating ‘No Smoking Zone.’
(a) Name the type of plan highlighted in the above statement.
(b) suggest the values that will help the youth to become responsible citizens of the nation.
Ans. (a) Rule
(b) Value Points
(i) Obedience (ii) Self-discipline
(iii) Concern for the health of other people
(iv) Respecting the law of the land.
Q32. A reputed car manufacturing company in NCR is facing the problem of a decline in its market share due to its internal mismanagement. Therefore, it has planned to increase its production capacity at its Gurgaon plant by manufacturing low-priced eco-friendly cars for price-sensitive consumers and introducing new models with added features for quality-conscious consumers.
(a) Name the type of plan followed by the management of the company.
(b) Enlist any three values that are incorporated in the company’s decision to achieve its objectives.
Ans. (a) Strategy
(b) Value Points
(i) Sensitivity (ii) Responsible behavior (iii) Celebrating diversity: ideas
(iv) Nurturing environment (v) Sustainable development
Q33. Natural Ltd. Is a company working on the principle of ‘Best out of Waste’ is engaged in utilizing waste materials, like used CDs, thrown-away cardboard, plastic thermocouples, and almost everything to make innovative and useful products like pen stands, lamp shades, decorative pieces, boxes, etc. The company has already engaged a few uneducated workers to get such useful waste materials. So, at negligible cost of procuring raw material, and use of labor-intensive techniques of production, it can obtain good prices for its products.
(a) identify and explain the type of plan highlighted in the above para.
(b) Identify any two values reflected in the above para.
Ans. (a) Method
(b) Values
(i) Optimum utilization of waste material (ii) Environmental protection
(iii) Recycling (iv) Promoting eco-friendly products
Q34. A reputed car manufacturing company in Gujrat is facing the problem of a decline in its market share due to its internal mismanagement. Therefore, it has planned to increase its production capacity at its Gujrat plant by manufacturing law-priced eco-friendly cars for price-sensitive consumers and introducing new models with added features for quality-conscious consumers. For this, the company issues shares to the public and raises Rs. 200 crores. The company purchases more machinery required to increase production.
(a) Identify the type of plan the company is preparing.
(b) State the steps involved in this plan by quoting lines from the above case.
(c) State any one value that the company wants to communicate to society.
Ans. (a) Strategy
(b) Steps involved in preparing a strategy are:
(i) Determining Long-term objectives- ‘… it has planning to increase its production capacity at its Gujrat plant.’
(ii) Adopting a particular Course of Action- ‘… manufacturing low priced eco-friendly cars for price-sensitive consumers and introducing new models with added features for quality conscious consumers.’
(iii) Allocating Resources Necessary to Achieve the Objectives – ‘… the company issues shares to the public and raises Rs. 200 crore. The company purchases more machinery required to increase production.’
(c) Values
(i) Sensitivity towards the environment (ii) Socially responsible behavior
Q35. Most of the company’s manufacturing cars have faced a sharp decline in the sale of cars over the past few years. A company did a thorough research and came to know the rising rate of petrol and interest rates on loans are the major causes of the decline.
(a) What suggestions you would give to the company to overcome the situation?
(b) what name of the plan you will give to your suggestion?
(c) State any one value which is highlighted in your suggestion.
Ans. (a) The company is suggested to manufacture highly efficient eco-friendly small diesel cars at affordable prices and may offer various schemes to attract customers.
(b) Strategy.
(c) Values
(i) Dynamic (ii) Adaptability
Q36. Rajesh reported at his office at 9 am as usual. At 11 am he received a telephonic message from his wife informing him about the accident of his father.
Rajesh rushed to his manager, Dinesh. Dinesh offered him a seat and a glass of water to drink. Dinesh asked what happened then Rajesh told him about his father’s accident. Dinesh replied to Rajesh not to worry about medical expenses as the same would be borne by the company. Rajesh left immediately for the hospital on one week’s leave.
Later, Paras, the assistant manager reminded Dinesh of a circular put on the notice board stating ‘no leave will be allowed before prior sanction.
Dinesh replied that his decision was based on ensuring employees’ welfare, fulfilling their needs, and addressing their grievances without disturbing the company’s operations.
(a) Identify and explain the type of plan that is highlighted in the above case by quoting the lines.
(b) Identify any two values displayed by Dinesh.
Ans. (a) Rule
‘Later Paras, the assistant manager reminded Dinesh of a circular put on the notice board stating ‘no leave will be allowed before prior sanction.’
(b) Values
(i) Cooperation (ii) Empathy towards employees
(iii) Mutual understanding (iv) Motivation
Q37. The Delhi government put restrictions on selling fast food in school canteens.
(i) Identify the type of plan the Delhi government has implemented.
(ii) Identify any two values which the Delhi government wants to communicate to the society.
Ans. (a) Policy
(b) Values
(i) Concern for children’s health (ii) Responsible behavior
(iii) Develop healthy food habits
Q38. A T-shirt manufacturing company wants to become a leader in the market, and for this detailed planning is done. The first step is to set targets for the three-month duration of selling a maximum number of t-shirts in the market which they set as Rs. 1,00,000. The team did not want to make any mistakes so they decided to do proper planning. They decide to chalk out alternate plans so that they can arrive at the best possible plan. However, the team is surrounded by doubts. To remove doubts, it goes for judging the plans to get the most profitable one. The plan is taken to the whole organization and the concerned persons and the best plan is finalized. Finally, it is put into action. Without much caring for the results the company starts working on the other project simultaneously.
(a) Identify the steps involved in the planning process that have been applied by the organization in the above case by quoting the lines.
(b) Identify the steps of the planning process which have not been indicated.
Ans. (a) (i) Setting objectives.
‘The first step … set as 1,00,000.’
(ii) Identifying alternative courses of action.
‘They decide to chalk out alternate plans…. Could arrive at the best possible plan.’
(iii) Evaluation of alternative courses of action.
‘To remove doubts…. most profitable one.’
(iv) Selecting an alternative.
‘…. The best plan is finalized.’
(v) Implementing the plan
‘Finally …. put into action.’
(b) (i) Developing premises.
(ii) Follow-up action.
Q39. Shenoy is the Chief Executive officer of Star Ltd. He by the other board members decides to formulate a general statement which will guide the thinking of employees. He further goes on to formulate many such statements in the next six months. These statements could be divided into two categories.
(a) Identify and state the type of plan highlighted above.
(b) Also give two types of this plan.
Ans. (a) Policy
(b) (i) major policies (ii) Minor policies
Q40. Lakshay is a supervisor at ‘Orange Ltd.’ He works at the supervisory level. He teaches on-the-job training methods in which a task has to be done by the workers at the supervisory level. He meets his boss on a weekday and gives him a numerical statement quantifying the amount required in various activities at the supervisory level for the next six months. The boss approves his requirements and gives him a job to set targets in figures about the next plan he thinks is good for the manufacturing unit.
(a) Identify and explain the two types of plans highlighted above by quoting the lines.
(b) Identify and state the step of the planning process highlighted above by quoting the line.
Ans. (a) (i) Method
‘He teaches …. supervisory level.’
(ii) Budget
‘… gives him …. Six months.’
(b) Setting objectives
‘The boss… manufacturing unit.’
Q41. Sagar is at the real point of decision-making in the course of his planning. He has arrived at this point after identifying various alternative courses of action. Then after doing this, he was thoroughly involved in the evaluation of each of these alternatives. He got involved in several permutations and combinations of various alternatives to arrive at this point.
(a) At which stage of the planning process is Sagar going through? Explain.
(b) Also explain the next two steps of the planning process.
Ans. (a) Selecting an alternative
(b) (i) Implementing the plan
(ii) Follow-up action.