Tuesday, 27 September 2016

The importance of planning in business

Hello readers, today I am going to be telling you about the benefits of planning. It is important to plan before embarking on any project as it will help you formulate strategies you will use to achieve your business goals. Planning in this context can be defined as a situation that predetermines actions to be taken in order to achieve business goals. Without a plan, you might not achieve your business goals. As such planning is essential to the success of your business. Thus, managers and business owners should always make plans.

Planning in business helps you to know what actions you need to take in order to improve your business. It also helps management allocate resources appropriately, as a plan will let you know what projects are likely to succeed. It will also let you know the ones that are likely not to succeed. Thus, it encourages management to spend adequate funds on the projects that are likely to succeed. It contributes to the management of finance within an organisation. 

It also helps management communicate with subordinates, as the plan made by the management lets subordinates know the actions they will be taking to contribute to the overall success of the business. Thus, employees can feel good about their own contributions, so in all a plan can serve as a motivational tool. It also reduces conflicts within a team as each team member knows what tasks they are suppose to execute in order to contribute to the overall success of the team. When tasks have been allocated to each team member by management, no conflict will arise over tasks being carried out.

It also helps a business to see opportunities which it can embark on. When opportunities are spotted, taking advantage of it helps the business to grow. Strategies for this opportunity can be developed as a result of the plan. Then it will also encourage the business formulate ways to implement the strategies as well as direct the business activities, so that the opportunities will contribute to overall success of the business.

Planning provides a medium through which a business can see if it is performing well as the target defined in plans serve as a yardstick to compare result with. A company will do better eventually if they can compare there result with the planned result. A favourable variance (actual result exceeds planned result) will show that a company is doing well and they will motivated to keep it up, however, when planned result exceeds the actual result it will motivate the business to do better.

That is all for today, thank you for reading this article. Keep checking out my blog regularly, cheers!

No comments:

Post a Comment