importance of planning in management

A number of empirical studies provide evidence of organizational success being a function of formal planning, the success being measured by such factors as return on investment, sales volume, growth in earnings per share, and so on. If there is any difference among various departments of company to launch new products then this yardstick of customer orientation can be used to sort differences and to arrive at a decision that gets the cooperation of everybody in the organization. Thus, management is complex and requires substantial advance planning. Planning involves identifying alternatives and choosing among those courses of action that are necessary for carrying out a given tasks. Any attempt to control without plans is meaningless, since there is no way for people to tell whether they are going where they want to go (the result of the task of control) unless they first know where they want to go (part of the task of planning). Planning increases the efficiency of an organization. Without a solid objective created by virtue of plans a business will not be able to scrutinize where it went wrong and thus will not be able to take corrective action to ensure success. Importance of planning in management are: Planning is the first and most important function of management. As already discussed, planning aims at executing the future course of actions in most efficient manner possible. Planning reduces rethinking, last minute troubles, especially for repetitive or routine matters. Planning being an all-pervasive function improves effectiveness of all other functions of management and ensures co-ordinated efforts throughout the orga­nization. Similarly without planning within departments coordination will not be possible. Planning means deciding, which further implies determining in advance, the actions and resources (human and physical) required to reach a goal. Organizations that plan in advance are more likely to succeed than those which fail to plan for the future. Planning is a philoso­phy of managing by objectives. To run a modern business undertaking there is a need for large number of people with different specialisation and complex machines. For example, If a firm decides to use its internal production capacities to meet its requirements as well as to outsource the same supplies, only plans give proper direction for when to outsource and when not. There is no way to control without plans. A firm may have a large number of options to exercise. It facilitates innovative and creative thinking among managers. Planning plays a important role in facilitating the functions of controlling and coordination. With growing sizes of the organizations and increasing complexities in their structure, planning even becomes more crucial. Controlling is often considered as an extension of the process of planning because of the interdependence of controlling on planning and vice versa. Uploader Agreement. significance of planning in the management and development of an organization. It permits control by expectation. According to Koontz and O’Donnell-”Plans are selected… course also which the management desires to co-ordinate group action. Say for example the government plans on promoting cottage in… Planning facilitates the function of controlling and, therefore, it is considered the foundation of control. This makes it necessary for the management to depend on planning to get a clear idea of what is to be done, when it is to be done, where it is to be done and how it is to be done. Planning gives a sense of direction; the working of the organisation and saves it from going astray or drafting about aimlessly. Planning is important in management because it allows managers to use resources efficiently and prepare for the unexpected. Business environment is constantly changing. A significant aspect of any formal planning process in collection of relevant information for the purpose of forecasting the future as accurately as possible. Importance of Planning The importance of plannings cannot be overemphasized for an organization or even for an individual. Planning states what is to be accomplished, and control systems are developed to evaluate how plans are progressing. Planning thus becomes the basis of all other functions of management. 5 Important Tips, What is Coordination? The important advantage of planning is that it makes it possible to utilise the available resources in an organisation in a better way. This hard work and dedication increase their reputation in the organisation and they come to acquire an identity of their own. As elaborated above, planning involves making predictions with the amount of information we actually have. A properly framed plan takes care to integrate different functions of an organization so that benefits of unified actions can be reaped. It is forward looking function based on forecasting in which plans are drawn after anticipating future events. Content Guidelines 2. These various alternatives do not come to the managers of their own; they have to be found out. It is very rare for an organization to succeed solely by luck or circumstances. following are the importance of planning 1.Primacy of planning Planning exit in all the managerial function while performing any function like organizing, directing, staffing, motivating, controlling one has to plan first. For example, when Cavincare Company (based in South India) wished to introduce shampoos in rural markets in south and where bottled shampoo were perceived to be bulky and expensive, Cavincare introduced their shampoos in sachets worth 50 paise that were easier to carry and used by many members in a household. “In 5 years’ time I need to get a job”. We have desires but not plans. Plans prepare against any such uncertainties based on prediction for future and plans can be as good as the predictions. Thus, it helps people take future oriented decisions. For example, a coffee business decides to expand across the country in different states. Planning is always made in respect of future which is always uncertain. In this way planning encourages the process of thinking. Formation of major plan and framing of overall policies is the task of top level managers whereas departmental … For example, car manufacturers control the production of passenger vehicles (cars for consumers) depending upon the calendar dates of festivals and accordingly control the purchasing costs of auto- components and raw materials, human resources, etc., by planning ahead. Components of Decision Support Systems (DSS), Importance of Planning Function of Management, Planning Reduces Overlapping and Wasteful Activities, Factors Affecting Decision Making Process of Consumer, Planning Establishes Standards for Controlling, Strategic Management – Meaning, Features and Important Concepts, Principles and Importance of Organizing Function of Management, 10 Popular Ways to Love Physical Education as Homeschoolers, How To Manage Your Studies with Part-Time Job? Not necessarily, does the enterprise need to discover a new product rather just the idea of differently managing operations resulting in a lot of cost saving/efficiencies. It facilitates the coordination of activities. Objectives provide a direction and all planning decisions are directed towards achievement of these objectives. Planning is a pre-requisite not only for achieving success but also as for surviving in a complex and competitive world. Plans elaborate the actions necessary for achieving organizational objectives and thus, help in deciding the activities to be taken up in the future. Planning plays a very important role in discharging this function. Planning helps the manager in carving out the future course of action and this brings a higher degree of certainty and order into the organisation than would be present without planning. With the help of planning, an enterprise can predict future events and make due provision for them. It has been observed that companies engaged in formal planning consistently out performed those firms with no formal plan­ning. Because planning acts as a foundation for the management function. Report a Violation 11. The importance of planning is stated as under: Any planning starts with making the statement of its objectives as enterprise as a whole and that for each department in the organization. Importance # 1. On the other hand every manager understands significance of planning in the management and development of an organization. Planning Importance in Management. As a result of this economy in operation is natural. Planning always carries future perspective and the future is uncertain. All round, effective planning at the beginning of a project is … With planning, managers can anticipate future events and develop plans of action to be used if and when those events occur. The three levels are; Strategic planning – oftentimes it is called supply chain design or strategy. This would minimize the chances of haphazard decisions. satyendra; August 1, 2015; 0 Comments ; controls, management function, planning, plans, risks, systems,; Planning – A Management Function . Planning facilitates other functions of management. Plans serve as standards for the evaluation of performance. Planning the development and management of natural resources should involve the broader development goals of the community aiming to improve the living conditions of the local population (such as marketing opportunities for the cultivated crops). Success and growth of an organization is mainly based on the planning function of the management and their leadership style. Planning minimiz­es costs because of the emphasis on efficient operation and consistency. Today’s world and markets are growing dynamic every day, in order to exceed competition, out of the box ideas are required to manage the functions of the enterprise. Sometimes the tastes of the consumers undergo a change and sometimes the techniques of production experience changes. In a fast changing environment the need for planning is all the more important because risk and uncertainty increase. Still, these alternatives are not necessarily the obvious ones and the managers would need to discover creative options. However, at its core, planningcan prove to be of great help to everyone. It improves performance by focusing management’s attention on adjectives and by helping management established priorities and cope with the ever-changing external environment. Would communicate to the following reasons: planning is the high level of planning is a process which the... With different specialisation and complex machines from ‘ non-managers ’ develop plans of action and resources that could lead business! A direction and all other functions of management and can lead to using in! 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