Planning can be defined as “Thinking in advance what is to be done, when it is to be done, how it is to be done and whom it should be done”. This is a futuristic action i.e. it is done for the future. In which, we have to identify what to do, when to do it, and how to do it. Planning is the first step in a function among the five functions of management.

Feature/ Nature/ Characteristics of Planning

  1. Planning Contributes to The Objective - Planning helps in achieving the objective. We cannot think of achieving any objective without any kind of planning. Planning is one of the foremost important primary steps in accomplishing the organisation.

  2. Planning is The Primary Function of Management - Planning is the first step that any manager or anyone adapts to use it to move towards any goal.

  3. Pervasive - Planning is universal. Planning is there in every organization, whether it is a small size, mid-size or large size or at whatever level it is, every manager, every individual employee plans on at his/her level.

  4. Planning is Futuristic - We do planning for the future. Hence it is called a futuristic process. We always stay in the present and plan for the future. Planning is never done for the past.

  5. Planning is Continuous - We plan to achieve any goal. We do the planning, staffing, directing, and then controlling. As soon as one goal is achieved, then we start planning for the next goal or objective. Hence it is called Continuous Process. All the time, planning is done at every level for the future course of action.

  6. Planning Involves Decision Making - In planning, function managers evaluate various alternatives and select the most appropriate way to manage things.

  7. Planning is a Mental Exercise - In planning, assumptions and predictions regarding the future are made by scanning the environment properly. This activity requires a higher level of intelligence.

Importance/ Significance of Planning

  1. Planning Provides Direction - Planning provides us direction. How to work in the future includes planning. By stating in advance, how work has to be done, planning provides direction for action.

  2. Planning Reduces the Risk of Uncertainties - Uncertainty means any events in the future that change our course of action. Planning helps the manager to face uncertainty. We cannot remove such uncertainty from our life. However, due to planning, we can work on such uncertainty. Just like an unforeseen event is going to come in which we are going in loss. So, if we are already ready, we have made funds for it, then we will be able to use it to fight that unforeseen situation.

  3. Planning Reduces Overlapping and Wasteful Activity - Overlapping means the working relationship has not been allocated specifically. If we plan, our time will not be wasted.

  4. Planning Promotes Innovative Ideas - If you are planning, then you get feedback from your senior managers or juniors, from there you can get innovative ideas. Besides, if you make your employees part of the decision making, then you can get new creative ideas from there too.

  5. Planning Facilitates Decision - Planning helps in decision making. The more efficient you plan, the more right you will be in the decision. With good planning, our decision making gets an accuracy, it gets feasible and it also gets improved.

  6. Planning Establishes a Standard for Controlling - Controlling is incomplete without planning and planning is incomplete without controlling. If you have done the planning but you do not oversee that the thing is happening or not, then the planning is useless. In case, there is no planned output then the controlling manager will have no base to compare whether the actual output is adequate or not.

  7. Focuses Attention on Objectives of that Company - Through planning, efforts of all the employees are directed towards the achievement of organisational goals and objectives.

Limitations of Planning

  1. Planning Leads to Rigidity - Once the planning is made, then it gets very difficult to change something in it.

  2. Planning May Not Work in a Dynamic Environment - If continual changes are happening in the environment, then planning will not be effective as things will not run according to the plan we have prepared. We have made a plan according to the situation but it is based on the environment, whether it is external or internal. If there are continual changes, then the right prediction, right planning becomes almost impossible.

  3. It Reduces Creativity - Planning reduces the creativity of employees of any organization because employees have to work the same set which is already decided, they do not get the opportunity to show their creativity or their innovativeness. Therefore, they become rigid, uncreative and innovative ideas stop coming.

  4. Planning Involves Huge Costs - When we have to take a very important decision and we have to hire experts from outside to take those positions, their fees are very high, due to which planning becomes costly. If we purchase equipment for planning, which is very coastal, then in that sense, planning becomes very costly to us.

  5. It is a Time-Consuming Process - Sometimes when long term plans have to be done or some important plan has to be made in which high level and low level are also included. Then it takes a lot of time to do that and that’s why planning is a time-consuming process.

  6. Planning Does Not Guarantee Success - Planning only provides a base for analysing for the future. It is not a solution for the future course of action.

  7. Lack of Accuracy - In planning many assumptions are made to decide about the future course of action. Sometimes planning is not accurate. Assuming for the future cannot be 100% accurate.

Planning Process

  • Setting up the Objective - Till the manager does not have an objective, he cannot do the planning, so Goal should always be clear, it must be set up.

  • Developing Premises - Premises means making assumptions for the future. The manager can make the assumption good and developed by studying the past decision and studying the facts.

  • Listing the Various Alternatives for Achieving the Objectives - After setting up objectives, the managers make a list of alternatives through which the organisation can achieve its objectives.

  • Evaluation of Different Alternatives - Now the manager will see the positive and negative of the option he has chosen, and then he will follow one or two of those plans so that he will execute and implement that plan.

  • Selecting an Alternative - Now the step, where the manager will select that alternative, where he will get the most positive, he will select that plan and he will reject the plan where he will get the most negative.

  • Implement the Plan - Now the manager who has chosen the alternative is acquitted to implement it, he will execute it.

  • Follow up - What we had kept thinking, if it is not possible in reality, if there is a difference between them, then we make adjustments to it and follow up in it.

FAQ (Frequently Asked Questions)

1. What Are The Characteristics of Planning?

There are so many characteristics of planning. Those are: 1) Planning contributes to the objective, 2) Planning is the Primary Function of management, 3) Planning is futuristic, 4) Planning is continuous, 5) Planning involves decision making.

2. What is the Importance of Planning?

The importance of planning is as follows- 

  • Planning leads to rigidity

  • Planning may not work in a dynamic environment

  • It reduces creativity

  • Planning involves huge costs

  • It is a time-consuming process

  • Planning does not guarantee success 

  • Lack of accuracy

3. Break Down The Entire Planning Process.

There are several steps to be followed in planning something. These are -

  • Setting up the objective

  • Developing Premises

  • Listing the various alternatives for achieving the objectives

  • Evaluation of different alternatives

  • Selecting an alternative

  • Implement the plan

  • Follow up