What Is The Role of Planning In A Business Organizations?

What Is The Role of Planning In A Business Organizations?

The Planning Function in a Business Organization can be defined as the process by which an organization develops a strategy to achieve its objectives. It is an important operational function and often one of the first activities planned by management teams. 

Creating business plans:

There are many reasons for creating such plans, but three are probably the most important. These are described below.


‘Preparation’ is one of the key reasons why many business organizations will undertake a planning function. They do this because they need to understand the direction in which their organization is going, its resources, and the threats that may come it’s the way. 

Therefore, it is imperative for any manager to clearly understand what each of these three things is before taking any actions.

Business planning during crisis:

Many organizations will not participate in such planning until a crisis has happened or a set of goals have not been met. Therefore, it is necessary first to define planning in an organization before discussing and developing any method to achieve these goals.

Planning a Two-way process

 When we say that planning is a process, it is a two-way process. It should start as a strategic idea, and it should be a priority at all levels of the organization. 

  • It should be the driving force that keeps the organization going forward. Only a robust planning process can ensure that this happens.

How do you make planning a strategic process? 

The first step is to set up a proper planning function. It can be done by a simple discussion between higher-ups and lower-level managers. 

  • They should take inputs from everybody in the organization to come up with a common understanding. 
  • It will lay the foundation for an organized approach towards achieving the goals.

The next step to answer the question: 

What is the role of planning in business organizations? 

The planning function of an organization should involve not only people at the top management level but also the lower-level workers: 

  • They play a crucial role in the day-to-day activities of the organization. 
  • Planning must include working capital management, inventory management, budget planning, human resource planning and development, and production planning. 
  • This process must be made part of the overall strategy and known to everybody in the organization.
The large-scale planning process involves long-term strategies:

 If such a long-term planning process is not part of your strategic planning, you might end up with an irrelevant document that might not provide any useful information in the future. 

  • You might even find that implementing your long-term strategies will be more costly than you anticipated and, therefore, not serve the organization’s overall goals.
Why does an organization need to implement a long-term strategic planning process? 

A planning process can give you a complete picture of your company’s needs, present and prospects. And provide a more holistic view of the entire organization. Therefore, a planning process should be part of the overall strategic planning activity of the company. 

Impacts of No planning:

Without a planning process, your strategic perspectives are not sure to be clouded. You might find that your strategic decisions are not well aligned with reality.

In Crux:

Role of planning in business organizations

 It is not enough to set up a planning process. So, if you do not know what you want your company to be like in the future. Therefore, your organization needs to analyze its current market position, quality. And however, competitive positioning to determine the necessary changes to make your company more competitive and efficient