In simple words, planning is deciding in advance what is to do, when, where, how, and by whom it is to be done. From the various lists of functions of Management, Planning IS the primary function of management. Its purpose is to ensure optimum utilization of human and economic resources in the basic processes. It precedes all other activities of the business undertaking It is a sort of drawing out a future course of business operations by out ming the sequence of events forecast with a reasonable degree of certainty. It involves not only anticipating the consequences of decisions but also predicting events that may have effects on a business. Thus planning is deciding in the present what to do in the future.
Planning is the determination of a course of action to achieve the desired results is a deliberate and conscious research used to formulate the design and order sequence of actions through which it is expected to reach the objectives All planning involves anticipation of future course of thinking before doing. It leads to the events. It is the determination of objectives and steps necessary to achieve them.
Planning bridges the gap between where we are to where we want to go. Planning is a mental process requiring the use of intellectual faculties, imagination foresight, and sound judgment. In the words of Peter F. Drucker Planning function of management is “the continuous process of
making present entrepreneurial (risk-taking) decisions systematically and with the best possible knowledge of their futurity, organizing systematically the efforts needed to carry out these decisions, and measuring the results of these decisions against the expectations through
organized systematic feedback.’ ‘
According to Koontz and O’Donnell; “Planning is an intellectually demanding process; it requires the conscious determination of course of action and the basing of decisions on purpose, knowledge and considered estimates.”
Planning requires both creativity and analysis in defining business opportunities and constraints. Hence it is called the art of the possible. It is the process of guiding the business enterprise towards clearly specified objectives with the clearest possible view of the future. Deciding what is desired and determining the actions required are both involved in planning.
Characteristics of Planning
The following are the characteristics of planning—
- Planning is looking into the future.
- Planning involves a pre-determined line of action.
- Planning discovers the best alternatives out of available many alternatives.
- Planning requires considerable time for implementation.
- Planning is a continuous process.
- Planning’s object is to achieve pre-determined objectives in a better way.
- Planning integrates various activities of the organization.
- Planning is done for a specific period.
- Planning not only selects the objectives but also develops policies; programs and procedures to achieve the objectives.
- Planning is required at all levels of management.
- Planning is an inter-dependent process which co-ordinates the various business activities.
- Planning directs the member of the organization.
Objectives of Planning
Objectives are keys to effective planning in any business organization. In fact, planning has no meaning unless it is related to certain well-defined objectives or goals. Objectives are not only useful in planning but also in other managerial functions like organizing, directing, and controlling. They are an important aid in decision-making in any area of business. Clear-cut objectives encourage consistency – in decision-making in the long run.
The achievement of objectives is a must for the survival’ and growth business organization.
- Beneficial in facing the competition–Planning helps in forecasting the competition which will have to be faced by the organization. It also helps in deciding the strategy to face the competition successfully.
- Certainty in Activities–ln every organization Planning decides the policies, describes the procedures and makes the rules for the activities of all the employees of the organization: This is helpful in bringing certainty and surety in the activities of the organization.
- Helpful in fulfilling the budgets—Planning helps the management in accomplishing the pre-determined budgets of the organization in a systematic and planned way.
- To provide a specific’ direction—Proper planning gives a specific direction to all the activities of an enterprise by making the outlines of these activities well in advance.
- Beneficial in Forecasting—Planning is to make plans for the enterprise on the basis of Forecasting. Planning helps in effective forecasting.
- Economy in Management—proper planning guides the management and all the employees of the organization in their activities. Planning establishes the co-ordination, among all the activities of the organization. It helps in maintaining effective control and discipline; it helps the comparison of actual results with the pre-determined Proper planning can also have a check on all types of wastages and it brings an economy in management.
- Helps in providing crucial information— All the workers and all the outsiders dealing with an organization can get all the important information regarding objectives, policies, and programs of the organization.
- To help in Risk-Forecasting—Through effective planning management can forecast the risk that may appear in the future. By forecasting the threats and risks, the strategies may be made to treat with them successfully and efficiently.
- To maintain healthy competition—Planning helps in providing healthy competition among all the employees of the organization and also among all the activities. It creates a healthy competition among the employees in their efforts towards the achievement of the pre-decided goals of the organization.