The full form of PPBS is Planning, Programming, and Budgeting System.

A description of the Planning-Programming-Budgeting System (PPBS), a management tool to provide a better analytical basis for decisionmaking and for putting such decisions into operation. A PPBS is constituted, basically, of five elements: (1) a program structure — a classification of the courses of action open to an organization for attaining its objectives; (2) an approved program document that includes precise, quantitative data on needs, resource inputs, and program outputs extending a number of years into the future; (3) a decisionmaking process that establishes the functions, rules, and timetables for the actions required by the PPBS; (4) an analysis process for measuring effectiveness and for weighing alternatives; and (5) an information system that supplies the data required to implement the system.

In ancient days, meaning the 1960’s, Planning, Programming, Budgeting Systems (PPBS) was considered an innovation in budgeting. PPBS was first introduced in the Defense Department in the USA in 1961 by Robert McNamara, and in all departments in 1965 until 1975. Though it failed to be widely adopted in government, PPBS is effective is less complex organizations such as NGO’s.

PPBS is an integrated management system that places emphasis on the use of analysis for program decision making. The purpose of PPBS is to provide management with a better analytical basis for making program decisions, and for putting such decisions into operation through an integration of the planning, programming and budget functions. Program decision making is a fundamental function of management. It involves making basic choices as to the direction of an organization’s effort and allocating resources accordingly. This function consists first of defining the objectives of the organization, then deciding on the measures that will be taken in pursuit of those goals, and finally putting the selected courses of action into effect.