Planning is essentially a process directed toward making today’s decisions with tomorrow in mind and a means of preparing for future decisions so that they may be made rapidly, economically, and with as little disruption to the business as possible.
Though there are as many definitions of planning as there are writers on the subject, the emphasis on the future is the common thread underlying all planning theory. In practice, however, different meanings are attached to planning. A distinction is often made between a budget (a yearly program of operations) and a long-range plan. Some people consider planning as something done by staff specialists, whereas budgeting is seen to fall within the purview of line
managers.
It is necessary for a company to be clear about the nature and scope of the planning that it intends to adopt. A definition of planning should then be based on what planning is supposed to be in an organization. It is not necessary for every company to engage in the same style of comprehensive planning. The basis of all planning should be to design courses of action to be pursued for achieving stated objectives such that opportunities are seized and threats are guarded against, but the exact planning posture must be custom-made (i.e., based on the
decision-making needs of the organization).
Operations management, which emphasizes the current programs of an organization,
and planning, which essentially deals with the future, are two intimately related activities. Operations management or budgeted programs should emerge as the result of planning. In the outline of a five-year plan, for example, years two through five may be described in general terms, but the activities of the first year should be budgeted and accompanied by detailed operational programs.
A distinction should also be made between planning and forecasting. Forecasting considers future changes in areas of importance to a company and tries to assess the impact of these changes on company operations. Planning takes over from there to set objectives and goals and develop strategy. Briefly, no business, however small or poorly managed, can do without planning.
Although planning per se may be nothing new for an organization, the current emphasis on it is indeed different. No longer just one of several important functions of the organization, planning’s new role demands linkage of various parts of an organization into an integrated system. The emphasis has shifted from planning as an aspect of the organization to planning as the basis of all efforts and decisions, the building of an entire organization toward the achievement of designated
objectives.
There is little doubt about the importance of planning. Planning departments are key in critiquing strategies, crystallizing goals, setting priorities, and maintaining control;8 but to be useful, planning should be done properly. Planning just for the sake of it can be injurious; half-hearted planning can cause more problems than it solves. In practice, however, many business executives simply pay lip service to planning, partly because they find it difficult to incorporate planning into the decision-making process and partly because they are
uncertain how to adopt it.
Though there are as many definitions of planning as there are writers on the subject, the emphasis on the future is the common thread underlying all planning theory. In practice, however, different meanings are attached to planning. A distinction is often made between a budget (a yearly program of operations) and a long-range plan. Some people consider planning as something done by staff specialists, whereas budgeting is seen to fall within the purview of line
managers.
It is necessary for a company to be clear about the nature and scope of the planning that it intends to adopt. A definition of planning should then be based on what planning is supposed to be in an organization. It is not necessary for every company to engage in the same style of comprehensive planning. The basis of all planning should be to design courses of action to be pursued for achieving stated objectives such that opportunities are seized and threats are guarded against, but the exact planning posture must be custom-made (i.e., based on the
decision-making needs of the organization).
Operations management, which emphasizes the current programs of an organization,
and planning, which essentially deals with the future, are two intimately related activities. Operations management or budgeted programs should emerge as the result of planning. In the outline of a five-year plan, for example, years two through five may be described in general terms, but the activities of the first year should be budgeted and accompanied by detailed operational programs.
A distinction should also be made between planning and forecasting. Forecasting considers future changes in areas of importance to a company and tries to assess the impact of these changes on company operations. Planning takes over from there to set objectives and goals and develop strategy. Briefly, no business, however small or poorly managed, can do without planning.
Although planning per se may be nothing new for an organization, the current emphasis on it is indeed different. No longer just one of several important functions of the organization, planning’s new role demands linkage of various parts of an organization into an integrated system. The emphasis has shifted from planning as an aspect of the organization to planning as the basis of all efforts and decisions, the building of an entire organization toward the achievement of designated
objectives.
There is little doubt about the importance of planning. Planning departments are key in critiquing strategies, crystallizing goals, setting priorities, and maintaining control;8 but to be useful, planning should be done properly. Planning just for the sake of it can be injurious; half-hearted planning can cause more problems than it solves. In practice, however, many business executives simply pay lip service to planning, partly because they find it difficult to incorporate planning into the decision-making process and partly because they are
uncertain how to adopt it.
