Business Studies XII Content
Importance of Planning
1. Focus on objectives: –Planning is related to the organizational objectives. All the operations are planned to achieve the organizational objectives. Planning facilitates the achievement of objectives It requires the clear definition of objectives so that most appropriate alternative courses of action are chosen.
2. Reduction of Uncertainties/ change: –Future is full of uncertainties. A business organization can operate successfully if it is able to predict the uncertainties. Some uncertainties can be predicted by undertaking systematic analysis and systematic forecasting. Thus, planning helps in reduction of uncertainties which may be caused by changes in all micro and macro level of environment.
3. Economical: – Planning assists in reducing the cost of performance by the selection of only one course of action amongst the different courses of. It removes hesitancy, avoids crises, eliminates false steps and protects against improper deviations.
5. Effectiveness: –Planning promotes organizational effectiveness which ensures that the organization is in a position to achieve its objective due to increased efficiency.
6. Co-ordination: Plans unify the activities for development of various sub-plans. Various departments work in accordance with the overall plans of the organization. There is harmony in the organization and duplication of efforts are avoided.
7. Innovation: – Planning helps innovative and creative thinking amongst the managers because many new ideas come to the mind of a manager when he is planning. It creates a forward-looking attitude amongst the managers.