Importance of Planning in an Organization

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Importance of Planning in an Organization


Planning refers to drafting out of future plans now. Without proper planning, a lot of trouble and confusion could rein in an organization.

The following reasons explain why planning is an essential part of any organization.

1. Creating competitive advantages
Planning helps an organization recognize their strengths and weaknesses and work on them to have an edge over their competitors.

2. Good use of resources
Resources are always limited for any company. In order to use them well without wastage, planning helps companies prioritize their needs.

3. Goal establishment
Setting goals is not easy for many organizations. Planning helps such organizations to come up with goals that will give them an edge over their competitors.

4. Team building
Planning coordinates all members together. Each person performs his/her work to contribute to the organization’s success.

5. Risk and uncertainty management
Every business faces risk of either low product sales or financial hardships. Planning help businesses come up with a contingency plan during such cases.

6. Assessing opportunities
Planning helps an organization spot new opportunities that can help them increase their profits.

7. For revising and updating plans
Planning is normally done ahead of time. This provides managers an opportunity to update them according to the new changes.

8. To improve performance
Whenever an organization sets up a plan, success comes forth. Planning ensures everything is followed to the letter until all the objectives have been achieved.

9. To become proactive
Proper planning gives organizations an opportunity to respond to challenges by taking the right action.

10. To set direction
Planning serves the purpose of giving an organization the direction to follow. Without a proper plan, people are likely to do things as they like.

11. Checks on products’ standards
A plan normally drafts out the standards that the products should follow. If the products are below those standards, changes are made to address the issue.

12. Enriches managers with knowledge
Managers in most organizations are tasked with planning. Since it involves a lot of creative thinking, managers do plenty of that which makes them more knowledgeable.

13. Promotes innovative ideas
While planning calls for all ideas to be placed on the table, normally the best ones are selected out.

14. Unifies everyone
Organizations are made up of many departments. Even though most of them work on different projects, planning brings all of them under one umbrella. Planning prevents confusion in an organization.

15. Ensures all facets are covered
Large organizations are made up of many sub-units. Planning ensures that the needs of all the departments have been fully included in the organization plans.

16. Allows for flexibility
Novice companies are usually unaware if most of their projects will succeed. Planning provides them an opportunity to draft escape routes.Organizations are extended in structure. Without a plan, it is easier to live some facets out.

17. To drive a particular course of action
Every company has some key goals. Drafting a plan can help a company drive forth an important agenda for maximized profits.

18. For decision-making
A plan helps organizations make sound and unanimous decisions. Absence of a plan can make directors and workers make decisions that swerve outside the organization’s goals

19. Shows progress
Having outlined a plan, an organization can use its plan to see if they are achieving their goals or not

20. Remarkable Rewards
As said earlier, planning ahead of time helps businesses make changes that can help them perform well which denotes remarkable rewards as well.

21. Controls employment, layoffs and addition of new assets
Planning helps organizations know when they should employ or lay off some workers. It also tells them when to buy additional assets.

22. Planning sells your business
A plan helps clients know what an organization sells, what its worth and how it can help them. Without a plan, an organization will have a few less informed clients.

23. For developing new alliances
Planning helps a business organization decide other companies it will establish alliances with.

24. Communicates the message to investors
While non-written plans only exist in the heads of the managers, written down plans help investors know the direction of the business before they can contribute their resources.

25. Motivates personnel
A plan outlines without discrimination how each individual in an organization is to be rewarded with financial incentives. This motivates workers to put in more efforts.

Conclusion: Planning is an essential part of any business or non-business organization. Planning enables people to work in order by following a similar script. Without planning, success cannot be attained.

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