Importance and limitations of business plan

Just like management is  continuous activity  in the same way  o  needs continuers  updates and  planning as the  business  moves on we need to  adjust  as per the  situation arrives. We can say that business planning is one of the most important factors of management. It also sets up the arena for all upcoming functions of management like organizing, directing etc. We will understand the perception of business planning.

●       We know that business planning or planning means in planning we decide what has to be done in future and we can say it decides what has to be done in future in order to achieve what the organisation or business wants to be.

●       So we can say that business planning helps to set the objective of the business and it develops a plan of action to achieve the desired results. Once the  planning is  done it  becomes  clear what  is  expected from the  people  working in an organization like  manager and worker they get the  clear picture of what is  expected from them  and  what  has  to  be  done to achieve the  desired objective.

●       Managers are very vital for the functioning of the business planning. It requires improvement, imagination and the ability to do multitasking especially from the managers. And planning is a function which managers of all levels should perform.

●       Business Planning is Important : Planning is very important and  plays a role  in management. It explains to  the  manager where the business is  heading. It also reduces the uncertainty in the organization. Now Let us discuss some important factors of planning.

●       Planning provides a Direction:  planning is predetermined planning for the organization. It explains how and what work is   to be done. Planning provides direction to workers and managers, without planning their actions will be clumsy and not organized.

●       Uncertainty is reduced by planning: Planning creates the objectives and at the same time it anticipates the future changes in the organization. So manager’s get the chance to prepare themselves for the future and planning also helps them to deal with the uncertainties. Planning helps to understand present, past and upcoming trends and deal with the uncertainty in the market.

●       Planning reduces the waste of time: The complete plans are made according to the needs of all departments. Planning ensures that all departments are connected and all the activities are coordinated, because of planning there is clarity in action and all work is carried out without any interruptions or waste of time.

●       Planning helps in Innovation: Planning in reality involves a lot of innovation on the side of the managers. Being the first purpose of management it is a very tricky activity. It supports the manager to expand their horizons and helps them to think another way. So the manager has to be imaginative, keen and inventive.

●       Planning makes the decision easier: In business planning the objective of the business has been set, a plan of action has been developed and even calculations are made for the future. This helps all the managers to make decisions easily. Decisions are taken fast because  of  business Planning.

●       Establish goals and Standards: Business Planning helps to set goals and standards. Business planning helps managers to check performances according to the standard. This will help the business to understand goals have been achieved or not. So planning is a precondition for controlling the business.

●       Business planning is significant and necessary for all business: but it has some limitations also below are some limitations of business planning.

●       Rigidit: once the business planning is done and the plan of action is set generally managers are working on the same business plan. The manager may not be in position to change the plan if required in certain circumstances, or the manager is not willing to change the business plan. This kind of rigidity is not best for any business.

●       Not perfect in vibrant Conditions: In an economic environment nothing is stagnant. Most of the time conditions keep changing like economic, political, environmental and legal these all conditions do change. In such a vibrant environment it becomes difficult to calculate future changes. And if a manager cannot predict precisely, the business plan may fail.

●       Planning can also reduce creativity: Business plan takes away the creativity from managers as they work according to business plan and they follow it blindly. Managers do not change the plan if the situation demands, sometimes they even don’t suggest to management that some changes are required in the business plan as per the situation so the manager reduces his creativity.

I have  explained about business  planning and some  limitation  of  business  planning end of the  day  it  depends  on planning and change the  business  plan if required or  condition  arrives to  do so well it’s  all about  proper  business  planning to become successful entrepreneur.

 

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