Describe the reasoning behind contingency plan. why did it emerge?
Answer:
Contingency plans are plans that you make when things don't go well, or in case of extreme pressures. Example say you build a new facility and plan for people to come and pay tickets to get in for whatever reason. You estimate that 500,000 people a year will visit. So when you finance the building you use the estimate in order to fit you loan options. When the 500,000 people doon't show then you need a contigency plan that states what will be done in order to make payments on the loan. There are many implications for managerial education. Good managers must have contigency plans for all sorts of thing. From when employees go on strike, low production levels etc. It is like a backup plan. Hope this gets you on the right track.
I am sure you heard of Murphy's Law. As much as we want to account in everything, often things don't always work out the way we thought they would. Without plan B, you may not have a chance to "fight another day". For example, you may have a good steady job, but people loses their jobs all the time. A savings account just for the rainy day is sort of a personal contingency plan.
A large organization, private or public without "Plan B" is like rolling the dice and put a lot of peoples livelihood at risk, not to mention the owner's investment.
The military have some of the best planners around. When a business go for the "Hail Mary" and loses, it may go belly up. When the military screws up, people die. Very few military goes into operation without thinking through the options. The thought process is important in managerial thinking both in private and public sectors.
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