Long-range planning is nowdays seen as an academic exercise Essay

Long-range planning is nowdays seen as an academic exercise - Essay Example It must be understood that planning is done to achieve certain goals. Long term goals can specify where the organization would like to be a few years in the future. Goals are stated as the intention of the organization that are specific, measurable, cover key result areas, challenging, and should have defined time periods. For individuals and workers at a given company, the goals may be linked to rewards (Welch, 2005). At the same time, planning specifies the means for achieving the organization’s goals (Daft, 2000). However today’s businesses operate in a highly volatile environment and managers are concentrating more and more on short term results. The statement given at World Economic Forum correctly suggests that ‘Long-range planning is nowadays seen as an academic exercise’ and this is fast becoming a widely accepted truth. Nevertheless in the interest of business as a going concern, the validity of the statement and legitimacy of long range planning needs to be re-evaluated. This paper focuses on discussing the merits and demerits of long range planning and aims to answer if it still is a necessary exercise or merely an academic exercise which can be ignored if other functions of management continue to perform at or better than expected levels. Before such an analysis is undertaken, it is important to know why the focus on the short term results is so predominant. Long term planning is getting more difficult and focus is shifting from it due to basic reason of increased volatility in the worldwide corporate as well as business environment. On top of that, the present financial community including stock/company analysts and mutual fund managers often evaluate the performance of many securities based on short term results. This means that a company presenting strong short term results can have its stock be given better performance reviews by peers. For individuals within the company, rewards such as bonuses, promotions and the like could