Answer in brief.
Explain any five points of importance of planning.
Attempt the following.
Explain the importance of planning.
Answer the following.
Define the term planning and explain the importance of planning.
Solution:
James Stoner: "Planning is the process of establishing goals and a suitable course of action for achieving these goals."
Importance of Planning:
It is the fundamental function that gives an outline about where to go, how to go, and reduces the risk of an uncertain future with the help of forecasting. The importance of planning is as follows:
1) Helps to set clear objectives:
Planning is concerned with setting objectives, targets, and formulating plans to achieve them.
It helps managers to analyze the present condition of the organization and on that basis to identify the ways of attaining the desired position in the future.
2) Provides path of action:
Planning ensures that the goals or objectives are clearly stated. They act as a guide and they provide direction for doing the right things at the right time with the right way. It helps employees to know what the organization has to do and what they must do for achieving the goals.
3) Planning improves performance:
It helps managers to improve future performances of employees by establishing objectives and selecting a course of action. It is beneficial for the organization. Planning leads to the efficient working of the employees. Due to proper planning, the employees can work according to time guidelines. This improvement in performances results in higher profitability of the organization.
4) Minimizes the risk:
Planning is based on forecasting techniques. It is the process of looking into the future and anticipating future changes. By deciding in advance the tasks to be performed, planning shows the way to deal with changes and uncertain events. Changes or risks cannot be eliminated totally but they can be anticipated and can be tackled with preventive measures. It minimizes the risk of future or uncertainties of the future.
5) Planning leads to optimum utilisation of resources:
Organizational plans are prepared by taking into consideration the availability of resources and the proper allocation of resources for various activities. It also facilitates optimum utilization of resources which brings higher efficiency and better results. One can avoid wastage of resources by proper planning.
6) Helps in decision making:
There are various alternatives in front of management. Achieving goals planning helps the management to select the best alternative by considering all the positive and negative outcomes of all the alternatives. Decisions are taken after selecting alternative courses of action to achieve a predefined goal. It helps the manager to make rational decisions.
7) Useful in setting the standards for controlling:
Planning sets out standards for controlling. So, the actual performance can be compared with the standards and managers can find out the deviation, if any between the actual and the standard performance. Such deviation can be bridged by taking controlling steps. Therefore, planning provides a basis for control. It is also important for maintaining discipline at the working place of the organization.
8) Facilitates Coordination of all activities:
Planning facilitates the coordination of activities. It reduces overlapping among activities.
All activities of business organizations are closely linked with each other which is considered in the process of planning. Sound planning interrelates with all the activities and resources of an organization. Thus, various departments work as per the overall plan, and coordination is achieved.
9) Facilitates other management functions:
Every organization functions towards achieving goal and goal is set at the planning stage.
Unless the plan is ready, other management functions such as organizing, staffing, etc. cannot be undertaken thus, planning facilitates all other functions of management.
10) Promotes innovative ideas:
Planning is the basic function of management. It is a process of decision making that involves the promotion of innovative ideas after critical thinking. Ultimately, these innovative plans result in the attainment of the goals of the organization. It is the most challenging activity for the management as it guides all future actions leading to the growth and prosperity of the organization.
In short, planning plays a vital role in every walk of life of an organization as well as of an individual. The future is highly uncertain and the business environment is changing. With the help of proper planning, the risks and uncertainties can be minimised definitely. Hence, planning is the basic requirement of any organization for survival, growth, and success.
OCM [Organisation of Commerce and Management] Business Studies, XII 12th Standard,
HSC OCM MARCH 2020 BOARD PAPER WITH COMPLETE SOLUTION OMTEX CLASSES
Balbharati Solutions for Organisation of Commerce and Management (OC) 12th Standard HSC Maharashtra State Board
Chapter 1: Principles of Management
Chapter 2: Functions of Management
Chapter 3: Entrepreneurship Development
Chapter 5: Emerging Modes of Business
Chapter 6: Social Responsibilities of Business
Chapter 7: Consumer Protection
