// September 20th, 2012 // No Comments » // Free essays
Planning is one of the most important functions of management. In the contemporary business environment, the role of planning has increased consistently, because there is a little margin for error today. In such a situation, modern organizations need planning in order to define clearly the major directions of their strategic development and practical objectives and ways of their achievement at the moment. However, the modern process of planning is affected by various factors which have never existed before. In this respect, it is possible to mention globalization as one of the determinant factors that defines the development of modern organizations and planning process.
First of all, the process of planning is very complicated and, simultaneously, planning is crucial for a successful performance of any organization. In actuality, planning comprises the backbone of the organizational performance because it is on the basis of plans the development and progress of the organization occurs and the functioning of the organization aims at the achievement of goals which are set in plans and by means which may be also defined in plans (Peters, 2007). Any way, it is obvious that all other functions of management are practically useless without planning. Obviously, there is nothing to organize or control, if there is no plan. Moreover, without planning the progress of any organization is impossible because the development without a plan occurs spontaneously and there is a high risk of misleading conceptions which may be applied by the organization and which may lead the organization to failure if there is no plan.
At the same time, it is necessary to distinguish difference between plans which are used by modern organizations. In this respect, strategic planning seems to be particularly important because it refers to the strategic development of organizations. In fact, due to strategic planning, modern organizations can define and apply the most effective strategies to achieve their strategic goal, but the achievement of these goals is impossible if tactical and operational planning are ineffective. Tactical and operational planning is focused on more concrete, practical goals which the organization needs to meet (Peters, 2007). For instance, such planning can include the creation of a new production line. In such a way, through the steady and systematic implementation of tactic and operational planning, it is possible to meet goals set by strategic planning.
Furthermore, the planning process is affected by various internal and external factors. At this point, it is necessary to underline that both internal and external factors are equally important for modern organizations. Internal factors, such as organizational culture, interpersonal relations within organizations, productive potential, structure, the qualification of the personnel, etc., determine the potential and opportunities of organizations to grow. Naturally, organizations cannot progress if they have some internal problems (Peters, 2007).
On the other hand, external factors are not less significant. The situation in the market and industry, for instance, affects the functioning of organizations and, therefore, planning should take into consideration external factors (Schein, 1999). Otherwise, organizations are likely to face a serious disparity between its internal structure and potential and external market situation.
In this respect, globalization is probably one of the most substantial factors which define the development of modern organizations. In fact, globalization can affect not only external factors but also internal development of the organization. Effects of globalization are also quite controversial (Schein, 1999). On the one hand, globalization eliminates fiscal barriers and stimulates cooperation of organizations worldwide. In addition, globalization stimulates the development of free trade and international market expansion. As a result, many companies enter new markets worldwide. (more…)