Every business enterprise has its own predetermined objectives to be achieved. In order to achieve the objectives in the best possible manner, it requires a lot of mental exercise based upon imagination, foresight and judgement for deciding the tasks to be undertaken and the techniques to be adopted. No doubt, the success lies in the effective and sound planning, which undoubtedly is determining future course of action.
Meaning and definition
Planning is to decided future course of action. It is the very first function of management, Planning is a systematic activity which determines, when, how and who is going to perform a specific job. It is sort of detailed programme, regarding task to be completed in future. It studies and analyses the work to be done, makes the arrangement of requisite men, machine, material, money and methods, so that the job can be completed effectively. It is rightly said the well planned is half done, because planning takes into consideration the available and prospective human and physical resources of the organisation and gets their effective co-ordination, requisite contribution and perfect adjustment.
Features of planning
An effective planning is the key to success, so it is necessary that an efficient management must take into consideration the following characteristics of planning.
Planning is an intellectual process : A good plan in based upon collection, study and analysis of the requisite facts, evaluating alternative combination of factors and depending upon the ability and intelligence of the management.
Planning is goal oriented : Planning is made to achieve the desired objectives of the business. The goal established should have general acceptance otherwise individual efforts and energies will be misguided and misdirected. Management being a team work, effective co-ordination and adjustment of individual and group efforts towards the cherished goal of the business in necessary.
Planning is the primary function of management : The management has to formulate plans first and afterwards it has to make arrangement of necessary resources, select and appoint the most suitable persons for every specific job and direct their efforts and energies towards desired goal. The actual performance is compared with the planned performance, to discover deviations and finally apply remedial measures. Necessary adjustments in the plans may also be made if required.
Planning pervades all managerial activities : Planning is essential for every sort of business activities. Every department whether, Purchase, Sales, Accounts, Auditing, Marketing etc. needs systematic planning. Co-ordination of different departmental plans and direction of their integrated energies towards the desired goal of the business depend on planning. Effective organisation, staffing, direction and controlling needs planning.
Planning is selective in nature : Planning is choice making of the best possible alternative out of the various alternatives. In order to accomplish the predetermined objectives of the business, there can be various alternative possible courses of action. Every line of action has its own plus and minus points. Planning studies and evaluates every alternative with reference to its needs and resources. Finally it decides the most suitable line of action to be adopted by the enterprise.
Planning is always forward looking : No doubt, we always plan for future. We anticipate future requirement and availability of resources. While determining the future demands, we have to take into consideration the existing and prospective resources of the business and fiscal, monetary and industrial policy of the Govt. Plans are always put to practice in future. It is only a setting, thinking and arrangement in advance for the future. Planning in this way is looking ahead.
Planning is a continuous process : Planning always continues in the organisation in one or the other form. The actual business situations may demand certain amendment or moderations in the plans, therefore, plans are modified. The controlling may also point out certain deficiencies in the plans and they are framed accordingly. The completion of one plan requires the other plan to be undertaken. In this way, planning is a continuous process.
Merits
Planning is beginning and end of all managerial activities. The importance of planning in management can be justified on the following grounds:
Planning is helpful in achieving business objectives : Planning anticipates future demands and evaluates existing and prospective resources. It makes effective co-ordination between physical and human efforts and channelises them towards the desired goal of the business.
Planning reduces future uncertainties and enables to face it : It is the planning which pre-assesses the future uncertainties and also enables the organisation to face these uncertainties with minimum wastage of resources. In the absence of planning for future uncertainties, the losses being suffered may be greater.
Planning enables the best possible use of resources : Planning evaluates the alternative uses of the available and prospective resources of the business and makes their most appropriate use. It is the planning which determines the specific use of individual resources.
Effective co-ordination : Planning determines the activities of different individuals, groups and departments in such a way, that maximum co-ordination between physical and human resources may emerge.
Planning facilitates decision making and promotes creativity : Planning assesses future requirements. In order to avail of the opportunities in an appropriate way concentrated efforts are made and as such new ideas, methods and techniques emerge.
Helpful in development an expansion : Planning tries to avail of all opportunities available by making the effective utilisation and integration of resources, which makes the expansion of business easy.
Effective organisation and control : Planning helps in determining the authorities, responsibilities and duties of individual employees. It has predetermined goal with which the actual performances are compared to find out deviation and suggest remedial measures.
Demerits
The limitations of planning given here under:
Planning depends upon fore-casting: Planning is based upon the anticipated fiscal and industrial policies. Any change in the anticipated situations may render plans ineffective.
Hindrance in the development of initiative : Planning strangulates the initiative of workers and compels management to work with inelastic methods. The employees have to work in conformity with plans and therefore it is incompetent to avail of the existing opportunities.
Government policies and technological changes create problem in planning : Planning anticipates future. It takes into consideration the possible political changes. If the political changes and the government policies are not as expected, planning becomes ineffective. Unexpected changes in the technological field of production and marketing etc. make the plan unsuccessful.
Planning is an expensive process : Collection, analysis and evaluation of the different information, facts and alternatives involve a lot of expense. According to Koontz O’Donnel expenses on planning should never exceed the estimated benefits from planning.
Machinery of planning can never be free from bias : Every planner has its own likes, dislikes, preference, attitudes and interests, which are reflected in the plans. If the planning machinery itself is biased, plans may not suit the general interest of the enterprise.
Unsuitability for certain businesses: Certain businesses like fashionable articles, where situations change rapidly, planning has limited scope. In a small business house which is itself short of finance, planning will prove to be a burden.
Shopping Cart
