by Planning is a continuous process and the primary function of management. Planning in management is all about outlining a future course of action in order to achieve organizational objectives.
Nature of Planning
Pervasiveness of Planning
Planning is pervasive and extends throughout the organization. Every manager has a planning function to perform in his department.
This stems from the fact that he is a manager and that planning is a fundamental function of management. The pervasiveness of planning is commonly overlooked and planning is generally considered as being the function of top-level managers of the organization.
Open System Approach
Planning adopts an open system approach. It takes inputs from the environment, processes these, and exports outputs to the environment. The open system approach of planning indicates that the identification of gaps is influenced by a variety of environmental factors like economic, political, legal, technological, socio-cultural, and competitive.
These factors are dynamic and change with time. Therefore, while adopting an open system approach in planning, managers have to take into account the dynamic features of the business environment.
A Rational Approach
Planning is a rational approach for defining where one stands, where one wants to go in the future, and how to reach there. In an organizational context, planning as a rational approach tries to fill the gap between actual status (current performance) and desired status (desired performance).
Significance:
Planning is primary function of management:
The functions of management are broadly classified as planning, organisation, direction and control. It is thus the first function of management at all levels. Since planning is involved at all managerial functions, it is rightly called as an essence of management.
Planning is a function of all managers:
Every manager must plan. A manager at a higher level has to devote more time to planning as compared to persons at the lower level. So the President or Managing director in a company devotes more time to planning than the supervisor.
Planning as a continuous process:
Planning is a continuous and permanent process and has no end. A manager makes new plans and also modifies the old plans in the light of information received from the persons who are concerned with the execution of plans. It is a never-ending process.
Planning secures efficiency, economy and accuracy:
A pre- requisite of planning is that it should lead to the attainment of objectives at the least cost. It should also help in the optimum utilisation of available human and physical resources by securing efficiency, economy and accuracy in the business enterprises. Planning is also economical because it brings down the cost to the minimum.
Planning and linking factors:
A plan should be formulated in the light of limiting factors which may be any one of five M’s viz., men, money, machines, materials and management.
Planning involves forecasting:
Planning largely depends upon accurate business forecasting. The scientific techniques of forecasting help in projecting the present trends into future. ‘It is a kind of future picture wherein proximate events are outlined with some distinctness while remote events appear progressively less distinct.”
Planning is dynamic (flexible):
Planning is a dynamic function in the sense that the changes and modifications are continuously done in the planned course of action on account of changes in business environment.
Planning as an intellectual process:
Planning is a mental work basically concerned with thinking before doing. It is an intellectual process and involves creative thinking and imagination. Wherever planning is done, all activities are orderly undertaken as per plans rather than on the basis of guess work. Planning lays down a course of action to be followed on the basis of facts and considered estimates, keeping in view the objectives, goals and purpose of an enterprise.
Planning focuses on objectives:
Planning is a process to determine the objectives or goals of an enterprise. It lays down the means to achieve these objectives. The purpose of every plan is to contribute in the achievement of objectives of an enterprise.
Objectives
Forward Bearing:
Planning provides specific forward momentum to all the activities in the organization by chalking out the future working procedure.
Forecast’s the Course:
The most important ingredient of planning is forecasting. This is basically plan development as per policies and requirement of the organization.
Assured Activities:
Planning drafts the policies, working procedure and decides controlling process for the activities in an organization so that confidence level increases in employees & management regarding the accomplishment of predefined goals.
Helps in Establishing Co-ordination:
Planning is the forefront initiator in any organization regarding coordination. This coordinates all the departments and also policies, procedures, objectives, etc. in business or industrial unit.
Forecast’s the Risk:
Planning forecasts the future threats, therefore technical strategies are most often planned and decided in advance to overcome the inconsistency or tackle the problems successfully.
Develops in Facing Competition:
Assists and develops the organization to face competitions of all sorts and in all aspects. This strategic process is part of the objectives of planning.
Present Important Information’s:
Planning makes available adequate information and communicates it to the employees in the organization as well as presents a positive picture of organization, its policies, functioning and results to the outside world.
Managing Budgetary Targets:
Budgetary Targets are executed & achieved as per the planning. It is a helping hand in planned budget utilization.
