7 Importance of Planning for the development of your business:
Planning is the first function of management. Hence, it has importance due to ever changing environment for the organizations.
1. To offset uncertainty and change:
As the future is uncertain, planning becomes a necessary instrument. Even if the future is certain it is necessary to have plan at hand to make things clear. According to Koontz O’Donnell, “even when the future is highly certain some planning is usually necessary”.
2. To focus attention on objectives:
As planning is to be goal oriented it must be directed to achieve the objectives, that is what an enterprise aims at achieving in a given period.
3. To facilitate control:
Through planning control can be effectively applied. It is planning that provides specific standards in terms of predetermined goals to check measure and control. Koontz O’Donnell says, “a manager cannot check on his subordinates’ accomplishments without having planned goals against which to measure”.
4. To obtain economical operations:
Planning is economical and it avoids wastes and reduces costs. Haimann points out that “Planning makes for purposeful and orderly activities. All efforts are directed towards desired result, haphazard approaches are minimized, activities are coordinated, and duplications are avoided”.
5. To stimulate awareness:
Planning makes the managers to be aware of today and what will happen tomorrow. It helps managers to establish a relationship with the environment and controls events that pose risk and uncertainty.
6. To foster unity:
Within an organisation there are functional departments like production, material, finance, personnel and marketing. Each one has to coordinate their activities by planning their programme incorporating the corporate plan.
7. To forecast:
Planning helps the organisation to foresee and identify those areas of potential and challenging opportunities, risks and uncertainties and thus directs its efforts to minimize such risks and uncertainties.