Why planning is important in management

For example, suppose a company fixes a sales target under the process of planning. Now all the departments, e. In this way, the attention of all the managers will get focused on the attainment of their objectives.

This will make the achievement of sales target a certainty. Thus, in the absence of objectives an organisation gets disabled and the objectives are laid down under planning. Planning is always done for future and future is uncertain.

With the help of planning possible changes in future are anticipated and various activities are planned in the best possible way. In this way, the risk of future uncertainties can be minimised. For example, in order to fix a sales target a survey can be undertaken to find out the number of new companies likely to enter the market.

By keeping these facts in mind and planning the future activities, the possible difficulties can be avoided. Under planning, future activities are planned in order to achieve objectives. Consequently, the problems of when, where, what and why are almost decided.

This puts an end to disorder and suspicion. In such a situation coordination is established among different activities and departments. It puts an end to overlapping and wasteful activities. Consequently, wastages moves towards nil, efficiency increases and costs get to the lowest level. For example, if it is decided that a particular amount of money will be required in a particular month, the finance manager will arrange for it in time.

In the absence of this information, the amount of money can be more or less than the requirement in that particular month. Both these situations are undesirable. In case, the money is less than the requirement, the work will not be completed and in case it is more than the requirement, the amount will remain unused and thus cause a loss of interest.

It is clear that planning selects the best alternative out of the many available. All these alternatives do not come to the manager on their own, but they have to be discovered. The question about whether managers really plan and the observation that many times they are simply too busy to retreat to the mountaintop and reflect on where the organization should be going and how it should get there miss the point: there are different types of planning.

What is the process where managers establish goals and outline how these goals will be met called?. How do the internal and external environments of the organization and its strengths and weaknesses impact the planning process? Why should managers plan? Understand the importance of planning and why organizations need to plan and control.

Planning is the process through which managers establish goals and detail how these goals will be attained. Skip to content Organizational Planning and Controlling. Prepare for Employees in the Boardroom.

Principles of management: An analysis of managerial functions. New York: McGraw-Hill, — Management planning and control. New York: McGraw-Hill. Why Should Managers Plan? Dalton, D. Absenteeism in remission: Planning, policy, culture [Electronic version]. Human Resource Planning, 10 2 , Do Managers Really Plan? Harvard Business Review, 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.

They see how their work contributes to the success of the organization as a whole and can take pride in their contributions. Individuals are less likely to resent budgetary targets when they had a say in their creation. Planning helps organizations get a realistic view of their current strengths and weaknesses relative to major competitors. The management team sees areas where competitors may be vulnerable and then crafts marketing strategies to take advantage of these weaknesses.

When a company has a planning process and a plan to follow, leaders are better equipped to prepare for the future. A business plan creates a focus for the company, uniting employees toward common goals. Planning helps a business identify its goals, according to Management Study Guide. Preparing for the future allows business leaders to consider the impact they would like the company to have and to find a way to get there. When a team works together to set goals, it allows everyone to be on the same page, working toward a common, shared purpose.

Workers are better able to recognize ways to work to achieve goals, as well as behaviors to avoid that could prevent the company from reaching its objectives.