Learn and Understand, Explain are the Nature and Features of Planning in Business!
Modern managers are facing the challenge of designing a sound action plan for their organizations to achieve their organizational goals. Planning gives a scientific direction to managers as to where the firm has to move to attain its objectives. A good organizational plan minimizes risk, reduces uncertainties surrounding business conditions, and it classifies the consequences of related action. Also learn, Concepts of Management, Explain are the Nature and Features of Planning in Business!
Planning increases the degree of success and establishes co-ordinated effort in the organization. It makes the managers future-oriented and their decisions co-ordinated. Good planning makes the organizations reach their objectives. In this backdrop, various issues of planning are narrated in the following paragraphs.
A careful analysis of the above definitions of planning reveals that:
- Planning is concerning with future and its essence is looking ahead.
- It involves thinking and analysis of information.
- It involves a predetermined course of action.
- It’s concerning with the establishment of objectives to attain in the future.
- It’s fundamentally a problem of choosing after a careful study of alternative courses.
- It involves decision-making.
- Its objectives are to achieve better results, and.
- It is a continuous and integrated process.
For instance, we find that the head of the family plans his expenditure, the housewife plans her daily chores, the teacher plans his teaching work, the student plans his studies and the farmer plans his agricultural activities. In the business field, the need for planning is all the more because of various factors such as fluctuations in demand, growing competition, the introduction of new products, scarcity of resources, changing technology, change in prices, government policy, etc. Organisational activity without a plan is likely to be ineffective and will drift without achieving success. Hence, planning is a must for business organizations.
Few Main Nature and Features of Planning in Business!
The following facts come to light about its nature and features:
(1) It is Focuses on Achieving Objectives:
Management begins with planning and planning begins with the determining of objectives. In the absence of objectives, no organization can ever think about. With the determining of objective, the way to achieve the objective is deciding in the planning.
In case, it is necessary to change the previously decided course of action for the attainment of objectives, there is no hesitation to do so. It is thus clear that planning is helpful in the attainment of objectives.
For example, a company decides to achieve annual sales of? 12 crores. After deciding upon this objective, planning to achieve this objective shall immediately come into force. It was thought to achieve this objective by giving advertisement in the newspapers.
After some time it comes to know that the medium of advertisement appeared to be incapable of achieving the target. In such a situation the medium of advertisement can change and it can shift from newspapers to television in this way, every possible change is made through the planning activities for the purpose of achieving the objective.
(2) Planning is Primary Function of Management:
Planning is the first important function of management. The other functions, e.g., organizing, staffing, directing and controlling come later. In the absence of planning, no other function of management can perform.
This is the base of other functions of management. For example, a company plans to achieve a sales target of 112 crores a year. In order to achieve this target the second function of management, i.e., organizing comes into operation.
Under it, the purchase, sales, production and financial activities are deciding upon. In order to complete these activities, different departments and positions are deciding upon. The authority and responsibility of every position are deciding upon.
After the work of organizing, information about the number of different people at different levels require to achieve the objective shall have to provide. This job will perform understaffing. Similarly, planning is the base of other functions like directing and controlling.
(3) It is Pervasive:
Since the job of planning is performing by the managers at different levels working in the enterprise, it is appropriate to call it all-pervasive. Planning is an important function of every manager; he may be a managing director of the organization or a foreman in a factory.
The time spent by the higher-level managers in the process of planning is comparatively more than the time spent by the middle-level and lower-level managers. It is, therefore, clear that all the managers working in an enterprise have to plan their activities.
For example, the decision to expand the business is taken by the higher-level managers. The decision to sell products is taken by the middle-level and lower-level managers. Also read, The Theory of Human Relationship Management!
(4) It is Continuous:
Planning is a continuous process for the following reasons:
(a) Plans are preparing for a particular period. Hence, there is the need for a new plan after the expiry of that period.
(b) In case of any discrepancy, plans are to revise.
(c) In case of rapid changes in the business, environment plans are to revise.
(5) Planning is Futuristic:
Planning decides the plan of action what is to do, how is it to do, when it to do, by whom is it to do all these questions are related to future. Under planning, answers to these questions are found out.
While an effort is making to find out these answers, the possibility of social, economic, technical and changes in the legal framework is kept in mind. Since planning is concerning with future activities, it is called futuristic.
For example, a company is planning to market a new product. While doing so it shall have to keep in mind the customs and the interests/tastes of the people and also the possibility of any change in them.
(6) Planning Involves Decision Making:
Planning becomes a necessity when there are many alternatives to do a job. A planner chooses the most appropriate alternative. Therefore, it can assert that planning is a process of selecting the best and rejecting the inappropriate. It is, therefore, observed that planning involves decision making.
For example, Mr. Anthony lives in a town where only commerce stream is taught in schools. His daughter has passed matrix and wants to get admission in 10 + 1. It is evident that there is only one option for her, i.e., commerce. Do you know about, What is Financial Management?
She doesn’t have to think or plan anything. On the other hand, if all the three faculties’ art, science & commerce were available in the schools, she would have to definitely think and plan about the subject of study. It would have been nothing but decision making in this case.
(7) It is a Mental Exercise:
Planning is known as a mental exercise as it is related to thinking before doing something. A planner has mainly to think about the following questions:
(i) What to do? (ii) How to do it? (iii) When to do it? (iv) Who is to do it?