Madhu completed her food technology degree two years ago. Initially, she worked in a company manufacturing chutneys, pickles, etc. After working in that company, she decided to venture into a organic food processing unit. Setting specific objectives and targets, Madhu devised a plan to achieve them. One key objective was to achieve a 8% profit in the first year. To facilitate this, Madhu planned to source raw materials like fruits, vegetables, and spices on a two-month credit from farmers engaged in organic cultivation. Additionally, she opted to manage the marketing of her products through her own outlets. In the organizational setup, Mohani took on the role of Production Manager, responsible for determining the precise procedures for production activities. Mohani also calculated the required workforce throughout the year based on Madhu's sales targets for different products and areas in the upcoming quarter. Maintaining a focus on safety and hygiene during production, Madhu implemented a penalty of ₹50 per day for failure to wear the mandatory caps, gloves, and aprons. This measure aimed to ensure a clean and secure working environment in the factory.

'Mohani also calculated the required workforce throughout the year based on Madhu's sales targets for different products and areas in the upcoming quarter.'

Which plan is highlighted in the above statement?

Budget

The correct answer is option 3 i.e. budget.

Mohani prepared the statement which shows the number of workers that will be required in the factory in the whole year. It is expressed in number which mean it is budget.

A budget is a statement of expected results expressed in numerical terms. It is a plan which quantifies future facts and figures. For example, a sales budget may forecast the sales of different products in each area for a particular month. A budget may also be prepared to show the number of workers required in the factory at peak production times. Since budget represents all items in numbers, it becomes easier to compare actual figures with expected figures and take corrective action subsequently. Thus, a budget is also a control device from which deviations can be taken care of. But making a budget involves forecasting, therefore, it clearly comes under planning. It is a fundamental planning instrument in many organisations.

* Programmes are detailed statements about a project which outlines the objectives, policies, procedures, rules, tasks, human and physical resources required and the budget to implement any course of action. Programmes will include the entire gamut of activities as well as the organisation’s policy and how it will contribute to the overall business plan. The minutest details are worked out i.e., procedures, rules, budgets, within the broad policy framework.

* Rules are specific statements that inform what is to be done. They do not allow for any flexibility or discretion. It reflects a managerial decision that a certain action must or must not be taken. They are usually the simplest type of plans because there is no compromise or change unless a policy decision is taken.

* Policies are general statements that guide thinking or channelise energies towards a particular direction. Policies provide a basis for interpreting strategy which is usually stated in general terms.