Step 1: State what we need to identify.
We are told that "developing premises" is the second step in the process of a particular management function. We need to name that function by recognizing where this step appears.
Step 2: Define what "premises" means in management.
Premises are assumptions or forecasts about the future environment, including expected economic conditions, market demand, competitor actions, government policies, and technological changes, that serve as the background against which plans are drawn.
Step 3: Recall the step-by-step process of Planning.
The standard planning process in management follows this sequence: (1) Setting objectives, (2) Developing premises, (3) Identifying alternative courses of action, (4) Evaluating alternatives, (5) Selecting the best alternative, (6) Implementing the plan, and (7) Follow-up or evaluation.
Step 4: Confirm that developing premises is the second step here.
After an objective is set (step 1), the very next logical action is to forecast and establish the conditions (premises) under which the plan will be executed. This confirms that developing premises is indeed the second step in the Planning process.
Step 5: Verify no other management function has this step.
Organising, Staffing, Directing, and Controlling do not have "developing premises" as any of their sequential steps. This step is exclusive to Planning.
Step 6: Conclude the answer.
Since developing premises is the second step in its process and it is specific to Planning, the management function being identified is Planning.
\[ \boxed{ \text{Planning} } \]