8 Importance Of Planning Function Of Management - Tyonote

Why Planning is Important? 8 Importance of Planning

Importance of Planning Function

Planning is a primary and inseparable function of management. It ensures smooth performance and the best utilization of resources including manpower. It defines a clear line of action so that the wastage of resources can be minimized.

Good planning is the foundation of an organization and a sign of efficient management. It contributes to bringing smoothness in the future course of action. The followings are the major importance of planning function of management.

  • Focus on goal
  • Minimize uncertainty
  • Effective control
  • Innovation and creativity
  • Organizational effectiveness
  • Economy in operation
  • Facilitates coordination
  • Avoids business failure

Let’s understand the importance of planning individually,

Focus on Goal

Every organization is founded with a specific goal in mind, and all of the organization’s operations are focused on achieving those goals. Plans aid in drawing the manager’s and other employees’ attention to the same goals.

At all levels of management, it establishes a clear path of action and responsibility. It removes ambiguity and unplanned behaviors. It makes it easier to bring all of the work units together in action and coordination. As a result, good planning is a hallmark of goal-oriented management.

Minimize Uncertainty

To reduce future risk and uncertainty, planning is essential. It entails predicting and anticipating future changes and uncertainties. The future is well-recognized to be uncertain and changeable.

As a result, every firm must operate in a constantly changing social environment. The value of planning is that it allows you to predict future changes and make the required preparations to deal with them.

Related: Types of Planning in Management

Effective Control

Control begins with planning. It establishes the quality of work to be done. Management gives direction and training for doing work based on the plan. It is useful for comparing actual performance to projected performance.

It also aids in determining the gap between expected and actual performance. It is impossible to maintain control without prior planning. Control, on the other hand, is more effective and significant when it is planned.

Innovation and Creativity

Planning, as an intellectual exercise, enables managers to think creatively and innovate. Managers are forced to consider the best objective and alternate course of action while designing a successful plan. This is a must if you want to grow and extend your business.

It aids in the development of staff motivation and morale. Maintaining an up-to-date position in business operations and dealing with business complexity is also critical. As a result, a well-thought-out strategy aids in the development of novel ideas and creative action.

Organizational Effectiveness

Planning aids in the elimination of waste and the most efficient use of existing resources. It leads to increased productivity and lower output costs. The foundation of the successful accomplishment of organizational actions is planning. It improves the effectiveness and efficiency of all organizational activities.

As a result, good planning aids in lowering production costs and increasing organizational efficiency.

Economy in Operation

Planning eliminates the need for trial and error. It chooses a course of action that is advantageous from an organizational standpoint. It lays up a clear path for all levels of management to follow. It aids in the implementation of a system within the organization, which in turn aids in the development of all members’ working efficiency.

Facilitates Coordination

Planning is a major function that ensures collaboration with other management tasks. It clearly describes the goals and strategies to be pursued, as well as putting other management responsibilities into action.


Planning is also critical for maintaining tight working relationships among all departments. This is required in order to foster a sense of belonging among all members of the organization.

Avoids Business Failure

Last but not least, the importance of planning is it reduces business failures. The primary goal of planning is to reduce the risk of a business failing. The basic goal of the planning process is to choose the optimal course of action from the many options available. Furthermore, it establishes a clear path of action for each member.

It aids in the maintenance of organizational unity and improved coordination among all members. It reduces performance uncertainty and risk, as well as a waste of organizational resources. In the end, it helps to increase productivity while lowering production costs.

Read Next: What is Organizing in Management?

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