Even corporate giants tend to utilize their resources carefully. Hence, the management at most organizations emphasizes the importance of planning. Ask yourself the following questions to understand how you can utilize resources better:.
What are the resources that need to be allocated to different departments to enable them to achieve their target? The goals should push everyone out of their comfort zones and inspire them to work hard. However, they should not be impossible to reach or else they will lead to failure. Organizations grow by setting higher targets and planning how they will meet them. A well-made plan can enable a team to improve its productivity tremendously. One of the most important functions of planning is that it helps in managing risk.
The ability to predict, prevent, or manage risks and contingencies is an essential need of any business. For instance, the government could bring regulatory changes during the current pandemic to mitigate damage. Or the financial markets could be unpredictable as a result of disruptions due to the pandemic. Planning empowers businesses to overcome such unforeseen challenges. Organizations that understand the importance of planning take steps to improve their human resource management and work culture as well.
By planning work efficiently and thoughtfully managers can create well-knit and self-sufficient teams that have the necessary resources and knowledge to carry out their responsibilities. Such workforce planning leads to the success of the team and the organization as a whole. Strategic planning helps companies identify their core competencies as well as the areas they need to do better to hold on to their market position.
Research-based planning can be used by organizations to spot competitor weaknesses and turn them into opportunities for growth. What is planning without successful implementation? If you want to manage the performance of your organization, you need to be able to execute your strategy as well. Hence , managers at all levels remain attentive towards achieving the goals.
Besides, business planning goes on attracting the attention of the managers of all levels towards achievements of Goals. Planning is on the basis of forecasts , which also provides guidance during the uncertainties of the future. Planning is required to safeguard the dangers of uncertainties. This uncertainty may be in respect of any element of the business, like competition, demand, costs, expenditure, government policy, etc. Similarl y , uncertainty may be due to various natural reasons, like the flood, drought, storms, tsunamis, fire, epidemics, etc.
Plans are formulated for safeguarding against these uncertainties, to the maximum possible extent, on the basis of well-conceived estimates.
Planning gives emphasis on the maximum utilization of human and physical resources available with the enterprise or the institution.
Duplication is also stopped by planning wastage are avoiding, organizational power is scientifically used. Natural resources are adequately utilized. Besides , coordination between various resources is also established through planning in business. The financial economy in various activities may be achieved through planning. By planning, unproductive, irrelevant and unnecessary activities may be abolished.
As a result, the maximum utilization of limited resources becomes possible and costs get reduced. Similarly , wastage in the field of production, distribution , finances, and personnel may be avoided and the financial economy may be gained in operation of all the activities.
Planning is helpful in improving the competitive strength of the institution, through which an institution may strongly face the competition of other Institutions. Planning in business is helpful in working out such a strategy, which may result in achieving success in the competitive economy.
Through planning, new products may be produced, plans capacity may be enhanced, modalities may be changed, quality of the product improved, style of the product may be changed, by which, the competitive strength of the institution may be improved. Planning has a quality of pervasiveness. Planning is necessary for each function of management.
Hence , the managers carry out the function of planning, by taking the result of planning for each managerial function. If planning is found to be inconsistent, its review is also provided for, and it is revised also. On the contrary, in the absence of planning, the managers will not be able to properly test the consistencies and inconsistencies.
Without plans, managers cannot know how to organize people and resources effectively. They may not even have a clear idea of what they need to organize. Without a plan, they cannot lead with confidence or expect others to follow them. And without a plan, managers and their followers have little chance of achieving their goals or knowing when and where they stray from their path.
Controlling becomes an exercise in futility. Too often, faulty plans affect the future of the entire organization. Planning is crucial. Organizations are typically managed according to two types of plans.
Strategic plans are designed by high-ranking managers and define the broad goals for the organization. Operational plans contain details for carrying out, or implementing, those strategic plans in day-to-day activities.
For instance, at Federal Express a strategic plan might address how products and services will be positioned against UPS and anticipated new competitors, whereas operational plans would deal with aircraft maintenance schedules and modernizing package-handling equipment.
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