Subject: Business Studies
Planning is the primary function of management, which predetermines the future course of action. It provides the foundation for effective management of the organization. It is an important management function. The position of any business organization depends upon planning.
Earning fame and fortune is the dream of every organization. To make this dream come true, measurable goals with achievable deadlines have to be set. This is what planning does. In the absence of planning, organizational activities become mealy random activities producing nothing but chaos.
Planning is the primary function of management, which predetermines the future course of action. It provides the foundation for effective management of the organization.
According to George R. Terry, “Planning is basic to other managerial functions. Without the lining, there would be nothing to organize, no one to actuate and no need to control.”
In the words of Peter F. Drucker, “ A management has no choice but to anticipate the future and attempt to mold it.”
It is a fact that planning does not guarantee success. It does not substitute facts for judgment. The necessity for planning arises because of the fact that business organizations have to operate, survive and progress in a highly dynamic economy where change is the rule, not the exception. Change may be sudden or slow. Such changes often give rise to deal with foreseen problems and unsuccessful struggles with unforeseen problems. The following points emphasize the needs of planning for organizations:
source:management.synergyy.com
Though planning is not a sure bet, in today’s competitive world, those who foresee the future only attain success, earn name, fame. The condition of an organization without a planning function can be well compared with a ship without radar. So there are so many points in favor of planning which are listed below:
To sum up, planning in an indispensable activity for every organization so as to take the advantages as mentioned above. In its absence, business activities become random. Planning works for the organization in the same manner as radar does on a ship.
Despite the essential need for and the unquestioned value of planning, it must be noted that planning is not all on the credit side of the ledger. It will not solve all the problems and guarantee business success. It has some serious limitations. They may be analyzed under the following two categories:
(Neupane, Surendra; Parajuli, Ram Prasad; Jha, Deepak Kumar; Chettri, Tuk Bahadur; Dulal, Gopal Prasad) (Shrestha)
References
Neupane, Surendra; Parajuli, Ram Prasad; Jha , Deepak Kumar; Chettri, Tuk Bahadur; Dulal, Gopal Prasad;. "Business Studies: Class : XII." Kathmandu: Nawakala Publishers, 2011.
Sharma, Surendra Raj; Jha , Surendra Kumar;. "Business Studies : Grade XII." Kathmandu: Sukunda Pustak Bhawan, 2011.
Shrestha, Kul Narsingh. "Business Organization and Management." Kathmandu: Nabin Publication, 2065 BS.
Planning is the primary function of management, which predetermines the future course of action. It provides the foundation for effective management of the organization.
Planning and control functions are said to be the inseparable twins of management. There is nothing to control without planning and without control, planning becomes a futile exercise.
Planning is a must for efficient and effective utilization of scarce resources. Such use of resources can be identified while preparing the plan and selecting the best course of action. Hence the need for planning.
What are the benefits of planning?
Planning is essential to overcome future uncertainties. It enables the organization to face these uncertainties with minimum wastage of resources. Planning is concerned with forecasting the future. It helps to reduce future uncertainties to some extent.
Planning focuses on efficiency and economy in operation. Guess work is banished, facilities used to the best advantage which minimizes costs of performance. It saves time, effort and money.
Planning and control functions are said to be the inseparable twins of management. There is nothing to control without planning and without control planning becomes a futile exercise. Against the backdrop of planning, standards are set, which help in channeling behavior in the right direction.
The plan defines the goals. On its basis, works assignments can be fixed. Once member knows what is expected of them, they can contribute better. Further, planning permits employees to participate in the ‘thinking’ process. This helps them to develop a board mentality which leads to their whole hearted effort.
Planned activities are definitely systematic. Hence they are expected to produce better results in comparison to the non-planned as they are prepared with great exercise based on facts and figures. The result increases in efficiency. It makes the organization strong and capable enough to face competition.
The accomplishment of goals in the absence of coordination is really a difficult task. Well, prepared plans unify interdepartmental activities. Each department knows what it must do to contribute to the objectives of the organization. Without planning such coordination would be a dream, with planning a reality.
Planning develops a system of working. There exists no place for trial and error. The result is a smooth flow of work as an everyday activity is set, controlled and coordinated as well.
What are the needs of planning?
The needs of planning are as follows:
The plan focuses action in the light of objectives. Planning avoids confusion and misunderstanding and ensures unity of action with the assignment of responsibilities and authority at all levels.
Running a business in today’s competitive environments, not an easy task. Planning gives proper direction as to how, what, when and by whom the works are to be done. It makes the job of a manager easy and helps to tackle business complexities.
Planning is basis for effective control. Creative actions of managers require for an organizational goal. Planning is a useful technique for helping managers cope with uncertainty and change by promoting creativity.
Planning involves the selection of the most appropriate alternatives and best objectives. Hence, there is the greater possibility of avoiding business failure through sound planning.
Planning is a must for efficient and effective utilization of the scarce resources by reducing the wastage. Such use of resources can be identified while preparing the plan and selecting the best course of action. Hence the need for planning.
All other managerial activities have no direction in the absence of planning. It is planning which set all management functions towards a move for successfully completing the organizational activities.
What is the limitation of planning?
The fundamental limitation of planning lies in forecasting. Planning, as we know, is concerned with future, which is uncertain and unpredictable. Assumptions regarding future are forecasting which the essence of planning is. The fate of planning depends on the accuracy of the forecast. It is true that no forecast can be unreliable and inadequate information. There is some element of truth in the statement ‘the only certain thing about a forecast is that it will be wrong.’ After all, forecasting is not as exact science. This is the biggest hindrance for drafting a sound plan.
Other limitations are as follow:
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