Business Planning is an important aspect of every business organization. The following article discusses about the basic components required for planning function of management.
Being one of the most important functions of a business management, planning is an essential part of it, which leads a business to a level which is wanted or intended. Effective planning enables business management to design the activities in such a manner as to facilitate the process of monitoring and curtailing time and efforts while it aids a business management in attaining the predefined goals and objectives successfully.
Planning is composed of some important components. Such as, Mission; Objectives; Policies; Procedures and Budgets.
Mission: It refers to the purpose of a business which is expressed in a few words generally. In this way, the objectives of a business firm are communicated in order that its people may follow them constantly.
Objectives: Objective is a purpose that each and every employee or department or division needs to fulfill in a way as is expected. Attaining the specific objectives leads the employees to contribute greatly to the common goals of a business entity.
Policies: Policies serve as guidelines for the objectives to be attained. They direct the employees about how to work and behave in a business organization.
There are various policies that a business needs to formulate in terms of sales, production, marketing and accounting and financial policies.
Procedures: Procedure refers to the process of a particular task. It is a direction to the employees as to how they can accomplish the tasks following the related ways or customary methods.
Budget: Budget is nothing but a plan prepared for both purposes, such as, planning and controlling. It must be noted that the process of planning involves preparing different budgets as per the requirement. By means of preparing the budget the comparison between the actual performance of a business and the expected performance is made
Effective planning is necessary for a business entity for its growth and survival in the market and being in the money constantly. A business should also strive to increase its productivity, as productivity is a measure of efficiency leading to generate greater revenues. It must be noted that productivity is the result of effective planning as well. As it goes in these words, “Productivity is never an accident. It is always the result of a commitment to excellence, intelligent planning, and focused effort.”
K. A. Fareed (Fareed Siddiqui)
Writer, Trainer, Author, Software Developer
BBA, MBA-Finance, MPhil-Financial Management, (PhD-Management)
Level 1 - Leadership and Management ILM – UK
Individual Member of Institute of Management Consultants of India
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