Effective and efficient planning is essential for organizational success and improved productivity. Many people think plans and planning are the same, but there is a difference between planning and plans.
What is the difference between planning and plans?
The difference between planning and plans is that a plan is a document that involves a list of activities needed to be done to achieve the given objective. While planning is a continuous process that produces, executes, and adjusts the plan if required.
Planning and plans may be used alternatively, but planning is a more significant aspect than plan. Let’s read further to understand the difference between planning and plans in more detail.
💡 Helpful Statistics About Planning: ● Companies with written business plans grow 30% faster. ● Businesses with a plan are far more likely to get funding than those that don’t have a plan. ● 67% of well-formulated strategies failed due to poor execution. (HBR) ● 60–90% of strategic plans never fully launch. ● 48% of leaders spend less than a day on strategy each month. (HBS) ● 95% of employees don’t understand their company’s strategy. (HBR) ● 61% of executives feel they are not prepared for the strategic challenges. (HBR) ● 77% of successful companies translate their strategy into operational terms and evaluate it on a day-to- day basis. (Palladium)
Table of Contents
Explanation of Difference between Planning and Plans
Before understanding the difference between planning and plans, we need to understand planning more holistically. Planning is a primary management function that serves as a backbone of other managerial functions.
Planning determines what to do, when to do it, how to do it, and who should do it. Hence, it gives you power over the future.
Planning provides a clear vision of where the business is right now and where it wants to reach. So, you prepare for the future while living in the present.
Planning involves:
- Establishing goals/objectives
- Developing strategies to accomplish those goals
- Allocating and managing resources
- Ensuring effective communication among concerned people
Does planning add value to the organization? The answer is yes. If a company has a formal written plan, the chances of its sales growth are increased by 30%. Therefore, planning and plans have great value in organizational success. (Henricks, 2008)
Plans are the result documents of the planning process. It is the declaration of the steps to be taken. Also, plans state the timing and order in which things are done to attain a given objective.
Comparison between planning and plans
Planning is a continuous process that includes ongoing evaluation, review, and adjustment of activities/steps towards defined goals.
It also considers the organizational assets, human resources, equipment, location, and relationship with vendors and suppliers. Furthermore, planning helps to mitigate the risk and chaos.
The difference between planning and plans is that a plan is a list of actions based on the current resources of the business to achieve the given objective. On the other hand, planning is the active process of carrying out that plan, analyzing it, and adjusting it.
Hence the term plan is a theoretical concept, whereas the term planning has practical implications. Planning doesn’t guarantee success, yet it is necessary to avoid chaos.
According to Boone and Koontz, the two management scholars, plans are the natural outcome of planning. Plans state the required detailed actions to achieve the objectives.
Planning Vs. Plans
Let’s see side to side the main aspects of planning and plans.
| PLANNING | PLAN |
|---|---|
| The process of establishing a plan to achieve goals | The document contains a list of activities. The plan is the product of planning. |
| Planning is an intellectual activity | The plan is a theoretical practice |
| Planning is a continuous task that executes the plan, reviews it, and revises it if needed | The plan involves a list of actions that need to be done in order to achieve the given objective |
| Planning is an active way of setting objectives, strategies, and procedures to accomplish goals | Plans need to be updated regularly based on the progress |
| Planning involves the capacity to think ahead | Plans help perform the mentioned activities |
| Determines where a business wants to go | Following a plan helps businesses reach their goal |
Planning is mainly an intellectual activity. Managers start planning future events way before these events happen.
So, planning involves anticipation and preparing for things in advance. Additionally, managers consider foreseeable risks and chaos while planning for the future.
In planning, managers determine:
- What is the business trying to achieve? — objectives
- How will the organization achieve its objective? – strategies
- How will the company know it is achieving its set goals? – performance measurement
The end result of all this planning is a plan. A plan is a resource everyone in the organization can use for guidance. It also defines responsibilities and roles for the given project.
Therefore, a plan is a blueprint for your business in the short and long-run.
A plan has two main components:
- Outcome statements/goal statements
- Action statements
Outcome statements refer to the end result; the goals managers want to accomplish.
Action statements represent the means by which a business moves forward to accomplish the defined goals.
Is planning necessary to devise a plan?
It is famously said, “A goal without a plan is just a wish.” Plan and planning are not opposites; they are part and parcel.
Planning is so essential in our lives that we unknowingly do it. We even plan our days, vacations, dinner menus, etc. So, a plan is critical for running things smoothly.
The plan is the product of planning.
Another critical aspect of the plan is that it is not hardwired. As the business grows and the surrounding environment changes, you must review and revise the plan to meet the latest needs. One can make adjustments in the plan to make performance better. Hence, planning is mandatory for making a plan and running a business efficiently.
Let’s take a simple example of planning. Say a small denim company wants to increase its sales:
1. Determine the goal. The goal is to sell 15000 pairs of jeans in a month.
2. Determine the strategy. The strategy is to focus on its marketing.
3. Determine the financial and human resources.
4. A plan will be produced when all these affairs are set in order.
A good plan will identify your customers and what services you can offer them.
The plan will also help you enhance the quality of your services and products. As well as empower you to manage your operations in a better way.
You cannot make a plan without planning; a product is not produced without a process. One goes through a comprehensive process to reach its final product, which in this case is a plan.
Why should managers plan?
Regardless of the size of an organization, managers always want to run the business effectively and efficiently. But, it is not possible without planning. If you are not devising a plan before starting a business, then the chance of your failure increases drastically. Hence, managers plan to steer organizations towards successful and profitable futures.
Although it is hard to see managers planning because it is a mental activity, a lot of stuff goes into planners’ minds: the internal organizational environment, size of the organization, external turbulence, competition, economy, etc.
In addition, the planner must think about past events and keep future opportunities in mind. Planners have to consider possible threats, risk factors, and environmental changes.
Also, planning involves taking into consideration the company’s strengths and weaknesses. A sound plan will help the business change their weakness into strengths.
According to a study conducted by two well-known institutions, Indiana University and Cornell University, businesses’ most significant problem is the lack of planning. So, managers should plan because it benefits the company, its growth, productivity, and profitability.
Failing to plan is like planning to fail. Therefore, planning is the fundamental process and coordinates other operations.
The importance of planning and plans
There are several reasons managers devise a plan for the organization, themselves, and employees. Some organizations fail not because of a lack of resources but because of a lack of planning.
It is important to plan because the future is uncertain. No one can anticipate the future with 100% accuracy. Hence, planning helps in handling risk and uncertainty.
Planning helps:
- To deal with risk, uncertainty, and change
- To coordinate and communicate
- To focus on organizational goals and objectives
- To improve organizational effectiveness
- To control damage and loss
- To grow and expand
- To organize all financial and human resources
Planning is the fundamental requirement for the survival and growth of any business. Managers formulate a course of action based on the developed plan.
So, the plan not only helps in increasing the business’s efficiency but also helps in controlling the activities performed. The plan also helps the employees maintain their focus on accomplishing organizational goals.
Another important factor behind planning and plans is the organization of all resources. Planning helps coordinate all employee activities and create a systematic road map for further actions.
In addition to that, plans mitigate future risks and uncertainty. Plans are also updated regularly to meet the needs better.
Planning encourages a manager’s creativity and gives a chance for innovation. Plans are also super helpful in the process of decision-making. Plans lead to better decisions, and better decisions lead to better performance.
Conclusion
Planning is vital for accomplishing objectives for any company and plans are the result of planning sessions. Planning and plans are used interchangeably, but the truth is there is some difference between planning and plans.
The difference between planning and plans is that a plan is a document that involves a list of activities needed to be done to achieve the given objective. While planning is a continuous process that produces, executes, and adjusts the plan if needed.
Planning may not guarantee success because the future is uncertain, but it certainly is essential for moving forward. You cannot run a business blindly without determining your goals and strategies.
Plans are a framework that defines the activities to attain the goal. Plans can be revised, changed, and updated according to the situation.
In a nutshell, planning and plans are necessary for running your business smoothly and efficiently. It can not only reduce the risk factor but will also increase productivity.