Why planning is an essential leadership skill

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The reaction is interesting when the topic of planning is raised with leaders. Are you one of those leaders who rub their hands together in anticipation or rolls their eyes thinking about the amount of work that lies ahead of you? And, for many leaders it raises the questions about why is planning such an essential skill to have?

Over the years the range of reasons from leaders in response to this question are many and varied. Leaving aside the all too familiar clichés about planning some of the recurring reasons offered include: the need for clear direction, set out a game plan, plan expenditure, avoid mistakes, ensure you have adequate capital, value creation, and plan for growth. All of these are reasonable reasons, however they only go part of the way to answering the question.

The reason why planning is an important skill for leaders is that proper planning gives leaders the confidence to commit. Commit what you ask? Resources is the answer. In broad terms when we consider any business, in any industry, there are four core resources required for it to function ; people, money or capital which has to be budgeted and allocated, materials in all shapes and forms that are used to support converting inputs into outputs e.g. computers, and last is time which is finite.

Lack of attention to planning means leaders risk making decisions that will impact the allocation and use of these valuable resources. The ‘knock on’ effects from poor resource allocation resulting from poor planning are far reaching and considerable:

  • Poor choices;
  • Focus placed in the wrong areas;
  • Increased costs;
  • Lost opportunities;
  • Decreased leverage;
  • Loss of efficiency;
  • Staff motivation and satisfaction are adversely impacted.

Ultimately poor planning impacts on the nature and quality of customer service provided because the resources are not available to meet existing customer needs or respond quickly to ever changing customer needs.

Far too much attention is placed on ensuring whatever plan template is being used is completed correctly, yet a correctly completed template that contains a poorly constructed plan is not likely to instil confidence. In planning the emphasis must be on thinking critically about how to best allocate available resources so as to maximise returns. As a leader, only when you are satisfied there has been adequate quality thinking undertaken should you commit your plan to paper because you will have built the confidence to commit your organisation’s valuable resources?

Vivente Australia enables leaders and managers develop the bond between people and performance, creating a powerful advantage: the synergy between people, leadership, management, and culture, produces performance that allows your business to achieve its best.

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