Importance of planning
1. Increases efficiency: Planning increases efficiency of the organisation by doing right things at the right time. Because of planning the departments in advance can know the work to be done. It helps to increase the efficiency.
2. Reduces Risk: It reduces risk involved in business activities. Planning is for future use and future is uncertain. While planning future uncertainties, adequate provisions must be made to meet the same. So it helps to reduce risk.
3. Facilitates Co-ordination: In the organisation works are done by teams. Individuals want to attain the goals set for him. When individual works are grouped the departmental goal can be achieved. On integrating department goal Organisational goal can be reached. Thus planning explains the responsibility of each individual, department and organisation. It provides scope for co-operation and co-ordination in organisation.
4. Helps Organising: It aids in organizing all recourses available in the organisation properly i.e., men, material, machinery, and money. So the works can be done effectively and efficiently without delay. It also helps to show the relationship between the workers in the organisation.
5. Gives right direction: It shows right direction to reach the goal, and avoid wastage. Because of planning the goals can be reached without delay in the cheapest way. It helps to use the available resources to the maximum.
6. Keeps good control: Planning is the first function of management and controlling is the last function. Planning without control is useless and control without planning is meaningless. Thus planning provides the basis for control.
7. Helps to achieve objective: Once the objective of the organisation is fixed, sub plans are prepared to attain the main goal. When employees follow the plan they are able to achieve the goal easily.
8. Motivation: planning helps to distribute work evenly throughout the year to every individual. Once the goal was set the employees will do their work without delay. They will be motivated to complete the work allotted to them. It helps to improve production.
9. Encourages creativity and innovation: It encourages creativity and innovation at the top levels. When ample space is given to the top level executives, they can try new methods to attain the goal and implement the quality ideas which they have.
10. Helps decision making: Several options are selected while making decision. Planning helps to select the best option among the alternatives, considering the available resources of the organisation.