What is the importance of planning and organizing as a function of management?

Planning is a procedure which comes from your thinking, actually from organized thinking. It will help you to create a proper plan for your business organization. It also provides you the way to think on how you will maintain your business organization. Planning is like a map. Seeing the map, you will conduct your journey, and reach the desired destination

Why Planning is The Most Important Function in Management

• It is the doorway for your business: you know where to start, and what your goals are. So, it is clearly defined why you are going to give efforts.
• It provides you directions: you also have your defined strategies. You know what to do, and what not to.
• You have your defined goals: you have done enough brainstorming. Now you know what your goals are. You can also change your goals if needed because you have enough time to think.
• It reduces the risk from your organization: when you define your strategies, you choose the most flexible ways. Also, you avoid the risk ways of achieving those goals. This gives you way to reduce the business risks.
• You can use your resources efficiently: you can find out ways of utilizing your resources fruitfully. You can ensure the most efficient way of utilizing those resources.
• You can achieve innovative ideas: As you have enough time to think before starting the business, you can find out innovative ideas.
• Fewer difficulties in decision making: As you already know what you are going to do, you will take less time on additional decision making.
• You can set standards for controlling: you can set standards to control your business activities in advance.

Planning is the most important function of management. A good business plan can show you a proper way to define business goals and strategies on how to achieve those goals.

Faizul Haque

Sheikh Faizul Haque is an internet entrepreneur and the founder of The Strategy Watch; Graduated from North South University with a double major in Accounting & Finance in Bangladesh.

With a strong interest in developing and improving Business Strategy and to Conduct Business Analysis.

Organizing is the function of management which follows planning. It is a function in which the synchronization and combination of human, physical and financial resources takes place. All the three resources are important to get results. Therefore, organizational function helps in achievement of results which in fact is important for the functioning of a concern. According to Chester Barnard, “Organizing is a function by which the concern is able to define the role positions, the jobs related and the co-ordination between authority and responsibility. Hence, a manager always has to organize in order to get results.

A manager performs organizing function with the help of following steps:-

1. Identification of activities - All the activities which have to be performed in a concern have to be identified first. For example, preparation of accounts, making sales, record keeping, quality control, inventory control, etc. All these activities have to be grouped and classified into units.
2. Departmentally organizing the activities - In this step, the manager tries to combine and group similar and related activities into units or departments. This organization of dividing the whole concern into independent units and departments is called departmentation.
3. Classifying the authority - Once the departments are made, the manager likes to classify the powers and its extent to the managers. This activity of giving a rank in order to the managerial positions is called hierarchy. The top management is into formulation of policies, the middle level management into departmental supervision and lower level management into supervision of foremen. The clarification of authority help in bringing efficiency in the running of a concern. This helps in achieving efficiency in the running of a concern. This helps in avoiding wastage of time, money, effort, in avoidance of duplication or overlapping of efforts and this helps in bringing smoothness in a concern’s working.
4. Co-ordination between authority and responsibility - Relationships are established among various groups to enable smooth interaction toward the achievment of the organizational goal. Each individual is made aware of his authority and he/she knows whom they have to take orders from and to whom they are accountable and to whom they have to report. A clear organizational structure is drawn and all the employees are made aware of it.

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