Importance of Business Planning

Planning is one of the areas that many businesses fail at. A lack of planning is something that can be a point of contention in a lot of areas of society, but it is an especially crippling thing right in the world of business. Small businesses get hit especially hard right out of the gate, but even the world's largest corporation can be brought down to its knees if planning stops becoming a consideration.

Failing to plan is about the same is planning to fail. This saying is more than cliche, but never the less it is one that has been proven to be true time and time again. To say some businesses have a long term direction would be giving them too much credit. When people talk about how businesses run from day to day, that is more true.

Many companies live for the quarterly reports, profits and losses. Which is important to consider with future plans going forward but also can be a problem if you become a slave for them. Sometimes success is rather slow and requires patience. A long term plan to really move your business forward. You might not make money during this quarter, but at the rate you are going, you may make money a year from now if you stay to this path.

Yet, decisions are made on a snap and on the first piece of bad news. The quick fix rules the business world and sadly, a quick fix will also more often than not mean a quicker death. It is the short term thinking that is devoid of planning, which will derail a company with any amount of resources.

The problem with planning increases when a company goes public and is on the stock market. So many businesses have really changed their direction due to a minor dip right on their company in the stock market. Of course, the stock market is a tricky thing where any losses may be reflective on the market as a whole. When a company moves into panic mode based on stock performance, those who own stock in the company will sense the panic and perhaps get the conclusion that the ship may be secret.

A never ending cycle of panic is created and thus the company will suffer, as their stock drops and investors and consumers alike lose confidence.

A plan should be created a stuck through with six months or a year. By then you should know whether something really works in the business world. One failed long term plan will do less damage in the long term than a half a dozen or more half baked change of directions that really show that it was done out of a panic move.

Planning is a concept which many can do well with. Yet, planning is supremely important right in the business world. A failure to plan is about the same is planning to fail. And a failure to plan is a key reason why many businesses large and small fail.