Question

benifits of planning​

Answer 1

Answer:

There is ample empirical evidence regarding the importance of planning in organisational success. It has been observed that companies engaged in formal planning consistently out performed those firms with no formal plan­ning. The performance/superiority is usually measured by such factors as net return on capital employed, sales turnover and growth in earnings per share.

Once the organisational objectives are set the planning process involves the development of appropriate methods for accomplishing them. Plans continuously reinforce the importance of these objectives by focusing attention on them.

We have already noted that there is a close relation between planning and forecasting. An important aspect of the planning process is the collection of relevant information to be used for forecasting purposes. Herein lies the importance of scenarios and contingency planning.

Answer 2

Answer:

1. Attention on Objectives:

Planning helps in clearly laying down objectives of the organization. The whole attention of management is given towards the achievement of those objectives. There can be priorities in objectives, important objectives to be taken up first and others to be followed after them.

2. Minimizing Uncertainties:

Planning is always done for the future. Nobody can predict accurately what is going to happen. Business environments are always changing. Planning is an effort to foresee the future and plan the things in a best possible way. Planning certainly minimizes future uncertainties by basing its decisions on past experiences and present situations.

3. Better Utilization of Resources:

Another advantage of planning is the better utilization of resources of the business. All the resources are first identified and then operations are planned. All resources are put to best possible uses.

4. Economy in Operations:

The objectives are determined first and then best possible course of action is selected for achieving these objectives. The operations selected being better among possible alternatives, there is an economy in operations. The method of trial and error is avoided and resources are not wasted in making choices. The economy is possible in all departments whether production, sales, purchases, finances, etc.

5. Better Co-ordination:

The objectives of the organization being common, all efforts are made to achieve these objectives by a concerted effort of all. The duplication in efforts is avoided. Planning will lead to better co-ordination in the organization which will ultimately lead to better results.

Explanation: