Objectives of Planning

Planning is important because it enables the organization to service and grow in the dynamic, changing environment. It is important to plan because of the following reasons:

1. Achievement of organizational objectives:

Planning helps the organization to achieve its objectives. Planning provides the path for achievement of organizational goals with minimum waste of time, money and energy. It bridges the gap between where we are and where we want to go.

2. Fulfillment of organizational commitments:

Organization have long-term and short- term commitments towards society, depending on their nature. A defense organization, for example, has long- run commitments while a retailer is more interested in short term goals or responsibilities. These commitments or goals of the organization can be fulfilled through planning.

3. It facilitates decision making:

Managers have to make decisions like: what to produce and how to produce. What are the organizational resources and how can they be effectively allocated over different functional areas. What are their primary goals- profit or social responsibility and many more? Planning helps to decide a course of action that will clove the specific problem,.

4.  It provides stability to organization:

Organizations that plan their operations ate more stable than others. Managers foresee risk and prepare their organizations to face them when they occur.

5. Overall view of the organization/Coordination:

Organization is a structure of relationships where each person’s authority and responsibility is clearly defined. Planning coordinates the functions performed by individual human beings and departments and unifies them into a single goal-the organizational goal. It unifies inter- departmental activates so that all departments work according to plans.

6. Optimum utilization of resources/efficiency of operations:

Organizations work with limited resources. Planning allocates these resources over different objectives and functional areas (production, personnel.finance and marketing) in the order of priority. This results in optimum utilization of scarce organizational resources (men, material, and money etc. ) and effective conversion into productive outputs.

7. Development of managers:

Planning involves imagination, thought and creativity by managers. while planning, managers develop their conceptual and analytical skill to coordinate organizational activities with external environment.

8. Promotes innovation/creativity:

Planning involves forecasting. Managers foresee future. analyze the strengths of their competitors and think of new and innovative ways of promoting their products. Planning promoters new ideas, new products, new relationships and thus, promotes innovation and creativity.

9. Basis for control:

Planning frames standards of performance and control ensures achievement of standards. Controlling involves measurement o factual performance, its comparisons to make better plans for future. Unless there are plans, there will be no control. Planning is, thus, the basis for control.

10. Reduction of risk:

Risk is a situation where moderately reliable information is available about future but it is incomplete. Uncertainty, on the other hand, is a situation where no information is available about future. Changes in government’s policies are a situation of uncertainty while entry of competitors in the market with a better technology represents a situation of risk. Planning helps to reduce risk through techniques of forecasting.

11. Morale boost up:

If organizational plans succeed and goals are achieved, managers and employees feel satisfied and morally boost up to further concentrate on organizational activities. Successful planning, thus, promotes success of the organization.

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