What is Planning?

“In 5 years’ time I need to get a job”. ” In 10 years I need to save enough to retire”. “In 15 years I need to able to break Sachin’s record of 100 centuries.” One way or the other all of us have desires of what to do in the future like the three mentioned above. But what some of us don’t have are Plans. We have desires but not plans. And when you have plans you tend to succeed more. Plans are not just desires, they are desires supplemented by the means to achieve them. Planning plays a important role in everyday life. From deciding when to get up for all that all important interview to deciding what to wear all gets involved in the process of planning. Like every human being a business also needs plans to materialize its objectives and succeed.

Planning refers to a process of looking into the future or presuming what will happen in the future under the existing circumstances and being prepared for it. For instance, consider there is a government regulation from buying a particular kind of machine because it is not eco-friendly. Then there is a good chance a machine similar to the banned one in emissions and posing the same kind of danger will be come down upon too unless that machine is indispensable. Hence a business can make plans accordingly and not invest there. Planning thus essentially involves deciding what to do and how to do something by making rational studied presumptions about the future. It is a creative process that intends to bridge the gap between where the business currently is and where it desires to be.


Systematic planning precisely considers available & prospective resources of the organization to manage effective delineation, coordination, & execution.

Planning is amongst the primary functions of management. It is required practically at all levels of management. With growing sizes of the organizations and increasing complexities in their structure, planning even becomes more crucial. Also, constantly changing and uncertain market further augments to the need of planning.

Importance of Planning Function of Management

The process of planning is the primary function of management and cannot be dispensed with. The following lists the importance of planning for any business enterprise:

Creation of Goals

Planning involves the process of creating realistic goals to be achieved. Thus it makes a business goal oriented. The importance of being goal oriented is the fact that everyone knows what their end is and can work towards it. Planning thus becomes the basis of all other functions of management.

Planning Provides Direction

The apparent purpose of planning is to provide directions where the efforts should be channelized to achieve the desired results in the most efficient manner possible. The objectives of the organization are defined in simple and clear words during communicating the established plan.

Direction is the process of giving instructions as to what to do. Planning plays a very important role in discharging this function. When a manager doesn’t know what is to be done, then he cannot ask an employee to do the work essential to achieving the end result. This leads to a situation where there is total havoc in the business with no one knowing what exactly to do and thereby compromising the stability and growth along with the success of the business.

With a proper plan in place, the efforts of all the managers and employees gain focus towards the attainment of their individual objectives, making the achievement of website launch target a certainty. However, in the absence of a concrete plan, otherwise would be a case.

Planning Tackles Uncertainty

As elaborated above, planning involves making predictions with the amount of information we actually have. This allows for a business to bring about a certain degree of certainty to the uncertain future. When the business anticipates a risk or a chance of loss in the future it can avoid such risk and make a better route to achieve its goals. This is how successful business ride the tide and become successful.

Planning always carries future perspective and the future is uncertain. Planning should accommodate all anticipated future events and accordingly acknowledge them by assigning appropriate activity to all such events. It reduces (not eliminates) overall risk of future uncertainties.

Planning Reduces Overlapping and Wasteful Activities

As already discussed, planning aims at executing the future course of actions in most efficient manner possible. Since, the questions of when, where, how, what and why are already addressed, disorder and shocks can be taken care of beforehand. Effective planning would always prevent any overlapping and duplication of efforts and resources.

Subsequently, wastage reduces, efficiency increases and costs decline. For example, if a particular resource has been allocated to design the homepage of the website, it would not be attempted by anyone else. Even if someone really has an idea for the homepage, he/ she would communicate to the allocated person rather creating it on own. In absence of planning, if more than one resource designs the homepage, first of all, there has been the duplication of efforts and secondly additional efforts might be required to now adjudge the better homepage.

Planning Promotes Innovative Ideas

Today’s world and markets are growing dynamic every day, in order to exceed competition, out of the box ideas are required to manage the functions of the enterprise. Not necessarily, does the enterprise need to discover a new product rather just the idea of differently managing operations resulting in a lot of cost saving/efficiencies.

Sometimes, it may be about selecting the best alternative out of the available options. Still, these alternatives are not necessarily the obvious ones and the managers would need to discover creative options. With such efforts, newer ideas emerge which are studied intensively.

Planning Facilitates Decision Making

Planning play a integral role in making important decisions. Whenever a manager has to make a decision he has to think about the bearing of such a decision on the overall plan and the business’ trajectory. Thus planning acts as a guide to make efficient and accurate decisions.

Planning Establishes Standards for Controlling

Planning plays a important role in facilitating the functions of controlling and coordination. Controlling is often considered as an extension of the process of planning because of the interdependence of controlling on planning and vice versa. Without a solid objective created by virtue of plans a business will not be able to scrutinize where it went wrong and thus will not be able to take corrective action to ensure success.

Similarly without planning within departments coordination will not be possible. Coordination involves aligning all the activities of the business in such a way that the end result is achieved in the optimum manner. If a department within the business makes plans understanding the plans made by the other department then such alignment frankly becomes impractical and becomes one of chance. This thereby prevents wasteful and overlapping activities.

Planning is a complicated process with multiple restrictions especially because of its futuristic nature. But its importance in a business cannot be overstated. It is better to prepare for the uncertain future in some certain terms than to not prepare at all.

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