Question

A standing plan is usually developed once but is modified from time to time to meet business needs as required. Which of the following is a standing plan?

• A. Project
• B. Budget
• C. Strategy
• D. Policy

Hint:

Standing plans provide ongoing guidance for recurring decisions.
Key standing plans to remember: Policies, Procedures, Rules, and Methods.

Answer 1

The Correct Option is D

Concept:
Plans are categorized based on their frequency of use into two primary categories: Single-use plans and Standing plans.
Understanding this taxonomy helps managers apply the appropriate planning tools for recurring versus unique operational situations.

Step 1: Distinguishing Single-use and Standing Plans:
$\bullet$ Single-use Plans: Designed for non-recurring situations or one-time programs to achieve specific objectives within an allocated time frame. Once the project or event concludes, the plan is retired. Examples include Budgets, Projects, and Programmes.
$\bullet$ Standing Plans: Designed for recurring operational situations to provide standard guidelines for organizational decisions over an extended period. Examples include Objectives, Policies, Procedures, Rules, and Methods.

Step 2: Evaluating the Listed Options:
$\bullet$ Project (A) is a single-use plan formulated to execute a specific, non-repetitive task.
$\bullet$ Budget (B) is a single-use statement of expected results expressed in numerical terms for a defined future period.
$\bullet$ Strategy (C) is a comprehensive, broad master plan designed to position the firm against environmental challenges.
$\bullet$ Policy (D) is a general guideline that provides broad parameters for managerial decision-making in recurring situations, making it a recognized standing plan.

Step 3: Final Selection:
Among the given options, Policy represents an established standing plan.

Step 4: Final Answer:
The correct answer is option (D).