Importance of Planning in Management | Why Planning is Important?

Importance of Planning in Organization, Management. Why Planning is Essential? 

Planning

Planning is when a person thinks of something is to be done & prepares ways to perform the activity. It is the primary function of management in every workforce. Good planning could lead the organization to the specified goals within specified time. Fluctuation in planning cause adverse affect to functioning in the organization. Let’s point out the importance of planning;

Importance of Planning 

1) Focus on goal 

Every organization has it’s own certain goals or objectives. You may think for your personal goals or objectives too. The main task of planning is to focus on goal, helps the organization to lead towards the predefined objectives. Planning helps an organization to achieve these aims, along with some ease and promptness. It defines clear link of action and responsibility. It helps to draw the attention of the managers and employees to the defined goals. 

2) Reduces risk and uncertainties 

In process of every activity, there may be uncertainties and handling that piece of activity could be risky too. Planning helps to forecast these types of risks and uncertainties. It also helps to take the necessary precautions to avoid these risks and prepare for future uncertainties in advance. 

3) Maintain effective control and establishes standards 

By determining the objectives of the organization through planning all the people working in the organization and all the departments are informed about ‘when’, ‘what’ and ‘how’ to do things. 

Standards are laid down about their work, time and cost, etc. The control function of management is directly linked to planning. It helps to evaluate the actual achievement and identify the deviation between planned and actual performance. It makes control effective and meaningful. 

4) Promote innovation and creativity 

It is obvious that planning selects the best alternative out of many available ones. All these alternatives do not come to the manager on their own, but they have to be discovered. While making such an effort of discovery, many new ideas emerge and they are studied intensively in order to determine the best out of them. Thus planning helps managers to express their creativity and innovation. 

5) Improves organizational efficiency and effectiveness 

Planning helps optimum utilization of all available resources and reduces wastage of valuable resources. It also helps duplication of any piece of work in the workforce. It defines the maximum gains at the lowest possible cost. 

6) Avoids business failures 

The main theme aim of planning is to overcome the business failure. Strategies and plans are developed overhand to avoid the problems. Thus it reduces business failure. 

7) Team building 

Planning promotes team building and a spirit of cooperation. When the plan is completed and communicated to members of the organization, everyone knows what their responsibilities are, and how other areas of the organization need their assistance and expertise in order to complete assigned tasks. 

8) Helps in decision making 

Making a selection or choosing something means to take a decision. In course of planning, various alternatives are discovered and the best alternative is chosen. The planning sets the target for decision making. It also lays down the criteria for evaluating courses of action. Hence planning facilitates decision making. 

9) Creates Competitive Advantages 

Proper planning helps organizations get a realistic view of their current strengths and weakness relative to major competitors. It then sets out the team that sees where competitors may be vulnerable and then crafts marketing strategies to take advantage of these weakness. Spying competitor’s actions can also help organizations identify opportunities they may have overlooked, such as emerging international markets or opportunities to market products to completely different customer groups.