Importance of planning
1. Planning provides direction: planning decides in advance how work is to be done. It ensures that goals and objectives are clearly stated, employees know what they are required to do to achieve the objectives, and organizations are able to work in coordination.
2. Planning reduces the risk of uncertainty: Organizations have to face many uncertainties every day. Planners look ahead and anticipate these changes. Planning shows the way to deal with them. So though risk cannot be eliminated, it can be anticipated and reduced.
3.Planning reduces overlapping and wasteful activities; plans are made keeping in mind the requirements of the organization, departments and individuals. Planning ensures clarity of thought and action and thus helps in avoiding confusion and misunderstanding.
4. Planning promotes innovative ideas: planning is a challenging activity that requires high thinking. It forces the managers to think differently and find better ideas and better methods to handle different situations.
5. Planning facilitates decision making: planning helps the managers to look into the future, evaluates alternatives and choose the most profitable proposition. Thus it helps in taking rational decisions.
6. Planning establishes standards for controlling: controlling means comparison between planned and actual output. If there is no planning, then the manager will have no base to compare whether the actual output is adequate or not. So planning is a prerequisite for controlling.