Planning is the basic managerial function. It is the first function of management. It is the process of deciding in advance what to do and how to do. Planning function is performed by managers at all levels.
Planning . The importance of planning in management can be measured from the fact that it is the first step in the management process.
Characteristics and Importance of Planning in Management
- It reduces the risk of uncertainty by preparing forecasts. It enables a manager to look ahead and anticipate changes. Thus it helps to design ways to deal with changes and uncertainty.
- It ensures that goals or objectives are clearly stated.
- It helps avoiding confusion and misunderstanding by ensuring clarity in action and thoughts. The useless and redundant activities are minimized or eliminated.
- It promotes innovative ideas. The new ideas can be take the shape of concrete plans.
- It facilitates the decision making by taking rational decision.
- It provides goals or standards against which actual performance is measured. Thus planning is pre-requisite for controlling.
- It is a continuous process
Limitations of planning
- Plan once formulated cannot be changed at later stages.
- It is a time-consuming process.
Steps in planning process
- The first and foremost step in planning process is setting objectives. The objective specifies what organisation wants to achieve.
- Once the objectives are set, the managers are required to make some assumption about the future. These assumptions are known as premises.
- The next step is to identify alternative courses of action.
- Once alternative courses of action are identified, the subsequent step is to evaluate the each identified course of action. Alternatives are evaluated in the light of their feasibility and consequences.
- The next step is to select the best possible alternative. The best plan has to be adopted and implemented. The ideal alternative would be most feasible, profitable and with least negative consequences.
- The last step is follow up. It involves monitoring the plan to see whether the plan is being implemented according to the schedule.
We hope you liked this article on importance of planning in management. Here are few useful articles for you to read next:
Download this article as PDF
Click to go to RBI Grade B Preparation Page
Tags: Planning process in management, planning and management, planning function of management