- Primacy of Planning: Planning precedes all other managerial functions. Since managerial operations in organizing, staffing, directing, and controlling are designed to support the accomplishment of organizational objectives, planning logically precedes the execution of all other managerial functions.
- To Offset Uncertainty and Change: There is continuous change in the environment and the organization has to work in accelerating change. This change is reflected in both tangible and intangible forms. Tangible changes are in the form of changes in technology, market forces, government regulations, etc. Intangible changes reflect in changes in attitudes, values, cultures, etc. In order to cope up with the requirements of such changes, organization must look ahead for its future course of action which is basically provided by planning process.
- To Focus Attention on Objectives: Planning focuses on organizational objectives and direction of action for achieving these objectives. Sometimes people in the organization may not be specific about its objectives because of lack of clarity and precise definitions. For example, often we take profit as the objective of a business organization. It is too abstract to be pursued. In order to enforce managerial actions, this should be defined more precisely.
- To Help in Coordination: Though all managerial functions lead to coordination in the organization, real beginning is made at the level of planning stage. Well-considered overall plans unify interdepartmental activities and consequently restrict the area of freedom in the development of purely departmental plans. Thus, various departments work in accordance with the overall plan, and harmony is achieved.
- To Help in Control: Control involves the measurement of accomplishment of events against plans and the correction of deviations to assure the achievement of objectives as set by the plans. Thus, control is exercised in the context of planning action as standards against which actual results are to be compared are set up through planning. At the control stage, an attempt is made to monitor the performance on continuous basis so that immediate action is taken if anything goes wrong.
- To Increase Organizational Effectiveness: Planning ensures organizational effectiveness in several ways. The concept of effectiveness is that the organization is able to achieve its objectives within the given resources. Thus, for effectiveness, it is not only necessary that resources are gut to the best of their efficiency but also that they are put in a way which ensures their maximum contribution to organizational objectives. In fact, this can be done by taking appropriate planning. Planning states the objectives of the organization in the context of given resources.
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