Tag: Need

  • Business Forecasting Definition, Types, and Need

    Business Forecasting Definition, Types, and Need

    Explore business forecasting with insights on its meaning, definition, types, and the need of forecasting for strategic planning and informed decision-making. What is Business Forecasting? It is an estimate or prediction of future developments in business such as sales, expenditures, and profits. Given the wide swings in economic activity and the drastic effects these fluctuations can have on profit margins. It is not surprising that business forecasting has emerged as one of the most important aspects of corporate planning.

    The Concept of Management explains Business Forecasting in the points of Meaning, Definition, Types, and Need.

    In this article discussing Business Forecasting: First Meaning of Business Forecasting, then the second Definition of Business Forecasting, the third Types of Business Forecasting, and finally Need of Business Forecasting. Forecasting has become an invaluable tool for business people to anticipate economic trends and prepare themselves either to benefit from or to counteract them.

    If, for instance, business people envision an economic downturn, they can cut back on their inventories, production quotas, and hiring. If, on the contrary, an economic boom seems probable, those same business people can take the necessary measures to attain the maximum benefit from it. Good business forecasts can help business owners and managers adapt to a changing economy.

    Meaning of Business Forecasting:

    Business forecasting is an act of predicting the future economic conditions on the basis of past and present information. It refers to the technique of taking a perspective view of things likely to shape the turn of things in the foreseeable future. As the future is always uncertain, there is a need for an organized system of forecasting in business.

    Thus, scientific business forecasting involves:

    • Analysis of the past economic conditions, and.
    • Analysis of the present economic conditions; so as to predict the future course of events accurately.

    In this regard, business forecasting refers to the analysis of the past and present economic conditions with the object of drawing inferences about the future business conditions.

    Definition of Business Forecasting:

    In the words of Allen,

    “Forecasting is a systematic attempt to probe the future by inference from known facts. The purpose is to provide management with information on which it can base planning decisions.

    Leo Barnes observes,

    “Business Forecasting is the calculation of reasonable probabilities about the future, based on the analysis of all the latest relevant information by tested and logically sound statistical econometric techniques, as interpreted, modified and applied in terms of an executive’s personal judgment and social knowledge of his own business and his own industry or trade.”

    In the words of C.E. Sulton,

    “Business Forecasting is the calculation of probable events, to provide against the future. It, therefore, involves a ‘look ahead’ in business and an idea of predetermination of events and their financial implications as in the case of budgeting.”

    According to John G. Glover,

    “Business Forecasting is the research procedure to discover those economic, social and financial influences governing business activity, so as to predict or estimate current and future trends or forces which may have a bearing on company policies or future financial, production and marketing operations.”

    The essence of all the above definitions is that business forecasting is a technique to analyze the economic. Social and financial forces affecting the business with an object of predicting future events on the basis of past and present information.

    Types of Business Forecasting:

    Various types of Business Forecasting are –

    General Business Forecast:

    No business is completely independent and hence general business forecast is undertaken. It helps to read the future conditions for business and to predict the probable changes in business conditions that are likely to occur in the near future. Every business is affected by the conditions of the c community in which it is located.

    We should not be under the impression that only business conditions influence the general business. Political conditions, fiscal policy, controls, population, and national income etc. have a direct bearing on the business. So, it is necessary for the manager to take into consideration all these factors. While forecasting the prospects of his enterprise.

    Sales Forecast:

    This type of forecasting decides the fate of the organization as the sales determine the success of the company. Therefore, sales forecasting should be undertaken with due care and precaution. So as to see that whatever planning department has decided is carried out to promote the sales. It is from this point of view only that sales forecasting has been deemed to be as a guiding factor in planning an important aspect of the organizational setup. 

    In this connection O’ Donnell points out that,

    “It is the sales forecast that must set the stage for internal planning, business expenses, capital outlays. Policies of all kinds are made the purpose ordinarily of maximizing profits obtainable from expected sales, whether this forecast is for a period of months or for a period of years; it is the key to future business plans.”

    Capital Forecast:

    Every business enterprise will have to think of its financial plans. It should be determined so as to meet the needs of the company. With this object in view, forecasting of capital requirements has become a necessity and is taken as a primary step in the organization.

    In every business concern, the capital is required not only to meet fixed and working capital. But also for depreciation, replacement, development, reorganization etc. Thus accurate forecasting helps the organization to employ its capital to the fullest extent and can get the optimum returns on its investment.

    The Need for Business Forecasting:

    Some of the important needs of business forecasting are listed below:

    Production Planning:

    The rate of producing the products must be matched with the demand which may be fluctuating over the time period in the future. Since its time consuming to change the rate of output of the production processes, so production manager needs medium range demand forecasts to enable them to arrange for the production capacities to meet the monthly demands which are varying.

    Financial Planning:

    Sales forecasts are driving force in budgeting. Sales forecasts provide the timing of cash inflows and also provide a basis for budging the requirements of cash outflows for purchasing materials, payments to employees and to meet other expenses of power and utilize etc. Hence forecasting helps finance manager to prepare budgets taking into consideration the cash inflow and cash outflows.

    Economic Planning:

    Forecasting helps in the study of macroeconomic variables like population, total income, employment, savings, investment, general price-level, public revenue, public expenditure, the balance of trade, the balance of payments and a host of other macro aspects at national or regional levels.

    The forecasts of these variables are generally for a long period of time ranging between one year to ten or twenty years ahead. Much would depend on the perspective of planning, longer the perspective longer would be period of forecasting. Such forecasts are often called as projections. These are helpful not only for planning and public policy making. But they also include likely economic environment and aid formulation of business policies as well.

    Workforce Scheduling:

    The forecast of monthly demand may further be broken down to weekly demands and the workforce may have to be adjusted to meet these weekly demands. Hence, forecasts are needed to enable managers to get tuned with the workforce changes to meet the weekly production demands.

    Decisions Making:

    The goal of the forecaster is to provide information for decision making. The purpose is to reduce the range of uncertainty about the future. Businessmen make forecasts for the purpose of making profits. In business, the forecast has to be done at every stage.

    A businessman may dislike statistics or statistical theories of forecasting, but he can not do without making forecasts. Business plans of production, sales, and investment require predictions regarding demand for the product, the price at which the product can be soled and the availability of inputs. The forecast for demand is the most crucial.

    Operating budgets of various departments of a company have to be based upon the expected sales. Efficient production schedules, minimization of operating cost and investment in fixed assets is when accurate forecasts recording sales and availability of inputs are available.

    Controlling Business Cycles:

    It is commonly believed that business cycles are always very harmful in their effects. Abrupt rise and fall in the price level injurious not only to businessmen. But to all types of persons, industries, trade, agriculture. All suffer from the painful effects of depression.

    Trade cycle increase the risk of business; create unemployment; induce speculation and discourage capital formation. Their effects are not confined to one country only. Business forecasting reduces the risk associated with business cycles.

    Prior knowledge of a phase of a trade cycle with its intensity and expected period of happening may help businessmen, industrialist, and economists to plan accordingly to reduce the harmful effects of trade cycle’s statistics is thus needed for the purpose of controlling the business-cycles.

  • What is the Purpose and Importance of Recruitment?

    What is the Purpose and Importance of Recruitment?

    Importance of Recruitment; Recruitment means to estimate the available vacancies and to make suitable arrangements for their selection and appointment. The Concept of the study Explains – the Purpose and Importance of Recruitment: Need, Purpose, Importance, and Strategy. Recruitment is understanding as to the process of searching for and obtaining applicants for the jobs, from among whom the right people can select. Also learn, What is the Purpose and Importance of Recruitment?

    Understanding and Learn, What is the Purpose and Importance of Recruitment? with Need!

    Importance of a strong recruitment process: Successful recruitment is a direct reflection of the legitimacy and professionalism of your business. Employing the right people for your business is the most important part of your organization. It is necessary to have a good recruitment process to attract the right kind of staff for the needs of your business. Your recruitment process must be cost-effective as well as time-consuming. Recruitment and training can be expensive and time-consuming, so when you are recruiting, make sure that you are making the right choice.

    A good recruitment process can reduce the time involved in searching, interviewing, recruiting, and training. It can streamline these procedures and make your search more efficient for viable candidates. Also, Creating a positive image for your customers, peers, and competitors is very important. New employees must list the skills needed to fulfill their duties. To get better and successful results in your recruitment process, promote specific criteria relevant to the job.

    Always evaluate the skill of your candidate for the position of recruitment for knowledge, skill, and ability “KSA”, this is a great assessment tool for recruiting the right candidate for your business. There is no guarantee that your selection will be correct, but you can reduce your risks and maximize your ability to rent the right candidate. If you have a successful recruitment process then you can find a good, qualified, reliable staff for your company. Be sure to follow an organized recruitment path and you will find candidates who prove to be a great asset to your business.

    Need for Recruitment:

    Every Company in the world knows the importance of the recruitment step in increasing. Also, The performance of the company and increasing the productivity of the products. In this part of the project we will mention some important point about the importance of the recruitment step in any organization:

    • It helps the organization by finding the need for requirements by job analysis activities and personnel planning.
    • To collect many job candidates with less cost.
    • It helps to organize applications by dividing them by underqualified or overqualified, to increase the possibility of increasing and choosing the successful person to the right place.
    • Employing new and better-qualified staff often the only effective long-term strategy for improving operational performance.
    • Also, the Capabilities and commitment of employees ensure an organization’s success.
    • Raise organizational and individual value in the short term and long term.

    Purpose of Recruitment:

    • Determine current and future needs: To determine the present and future needs of the organization, with the combination of their plan and job analysis activities. Also, This is one of the most important objectives of recruitment.
    • Increase in the job pool: To increase the pool of job candidates at the minimum post cost.
    • Assistance in increasing success rate: To help increase the success rate of the selection process by reducing the visible number of under-qualified or exaggerated job applicants.
    • Help reduce the probability: To help reduce the likelihood of job applicants, once recruited and selected, only after a short period they can cure the organization.
    • Meet the organization’s social and legal obligation: it should fulfill the organization’s social and legal liability towards the combination of its employees
    • Start identifying job applicants: Identifying job applicants and preparing for potential job applicants will be suitable candidates.
    • Increase effectiveness: To increase organizational and personal effectiveness in the short-term and long-term.
    • Evaluate effectiveness: To evaluate the effectiveness of various recruitment techniques, all types of jobs are the source for the applicants. Also, This is the ultimate purpose of recruitment.

    The Purpose and Importance of Recruitment:

    Following a few points is explaining:

    • Determine the present and future requirements of the organization in conjunction with its personnel planning and job analysis activities.
    • Also, Increase the pool of job candidates at minimum cost.
    • Help increase the success rate of the selection process by reducing the number of visibly underqualified or overqualified job applicants.
    • Help reduce the probability that job applicants, once recruited and selected, will leave the organization only after a short period.
    • Meet the organization’s legal and social obligations regarding the composition of its workforce.
    • Begin identifying and preparing potential job applicants who will be appropriate candidates.
    • Also, Increase organizational and individual effectiveness in the short term and long term.
    • Evaluate the effectiveness of various recruiting techniques and sources for all types of job applicants.

    What is the purpose of the Recruitment Strategy?

    What is the issue of any strategy? A strategy defines big and important questions. Who, what, when, and why Who is doing when? And why are they doing this? Your recruitment strategy is hoped that the skilled use of company resources will be prepared to give your business the best talent to get a job. Also, Your strategy can generate productive benefits in your market!

    So, what’s the purpose? A recruitment strategy creates activation and clarity of purpose in the process of attracting and selecting talent for your business and aligns business goals with talent acquisition goals. Also, An employee strategy starts with understanding and understanding the value of your company to best understand and understand the behavior of those employees that you want to attract.

    A recruitment strategy clarifies the purpose or vision of the company for the future. A well-executed recruitment strategy will align employees with specific behaviors that are encouraged in the company.

    More to know…!

    A different purpose of deciding a recruitment strategy is how talent will be identified and business will be attracted, how the employer brand will be marketed for talent, and ultimately how it will be evaluated for employment for candidates. Attracting talent depends on your recruitment brand. How will you present your company and its brand authentically and describe it? Where do you propagate your company? Also, This is where good job descriptions, scorecards, job postings, recruitment techniques, and recruitment partners come into play.

    Today, no one can be the best in their entire strategy. Evaluating talent is also a big part of your recruitment strategy. Do you want your manager to talk with recruitment about how they get into the business and sell more about why your company is great? Or will you define the questions and role of your managers because you make the recruitment team? Always define team roles in evaluating talent. Also, Determine evaluation procedures and standards in continuous ways to attract and evaluate talent!

    What is the Purpose and Importance of Recruitment - ilearnlot
    Image Credit to ilearnlot.com.

  • Explain essay on the Co-Ordination of an Organization!

    Learn, Explain essay on the Co-Ordination of an Organization!

    Before start studying, you must know what common question types asked around the place. Essay for Articles: What is the Essay on the Meaning of Co-Ordination? What is the Essay on the definition of Co-Ordination? What is the Essay on the Need for Co-Ordination? What is the Essay on the Techniques of Co-Ordination? What is the Essay on the Nature of Co-Ordination? and What is the Essay on the Importance of Co-Ordination? Also Learned, Explain essay on the Direction of an Organization! That is similar to Explain essay on the Co-Ordination of an Organization!

    Now Explain it:

    #The Essay on the Meaning of Co-Ordination:

    Co-ordination is the process of synchronization and harmonization of the different activities within the enterprise with reference to time, the progress of work, performance standards, etc. If the objectives of the business are to be realized with a minimum of friction and a maximum of cooperation, a system of coordination through the establishment of the formal relationship among different individuals and departments has to be instituted.

    #The Essay on the Definition of Co-Ordination:

    Henri Fayol, Louis A. Allen, and Ordway Tead considered coordination as a separate managerial function. James D. Mooney considered coordination as the first principle of organization. According to Mooney and Railey, “Co-ordination is the achievement of orderly group effort and unity of action in the pursuit of a common purpose.”

    It is that process whereby an executive develops an orderly pattern of the group effort among his subordinates and secures unity of action in the pursuit of common purpose. “It is the orderly synchronization of efforts to provide the proper amount, timing and quality of execution resulting in harmonious and unified actions towards a stated objective.”

    George R. Terry and Theo Haimann regard coordination as a permeating function of management passing through the managerial functions of planning, organizing, staffing, directing and controlling.

    #The Essay on the Need for Co-Ordination:

    It is a pervasive function. The managers seek to achieve co-ordination through planning, organizing, staffing, commanding and controlling. Performance of any of these functions is an exercise towards coordination. When all these functions are related to each other harmoniously into a unified whole, co-ordination is achieved.

    In fact, managers at all levels, preside over the “nerve centers” of co-ordination in respect of their own spans of control. This means that coordination is the function of all levels of management and not merely of the top management.

    #The Essay on the Techniques of Co-Ordination (How to Achieve Co-Ordination?):

    #Clearly Defined Goals:

    The goals of the enterprise should be laid down clearly. Every individual in the enterprise should understand the overall objectives and the contribution of his job to these objectives.

    #Precise and Comprehensive Programmes and Policies:

    Laying down well-defined programmes and policies is another measure for achieving effective coordination. This brings uniformity of action because everybody understands the programmes and policies which act as guides for taking decisions.

    #Clear Lines of Authority and Responsibility:

    An enterprise is composed of several vertical and horizontal authority relationships. Authority flows from the top through various positions down to the level of operative workers. There is a line of authority in every enterprise which indicates that who is accountable to whom. This line of authority and responsibility should be clearly defined to achieve co­ordination.

    #Effective Communication:

    Effective communication is key to proper coordination. The channel of communication used in the enterprise should be reliable so that they are able to create proper understanding in the mind of the receiver. As advised by Mary Follett, personal contacts should be encouraged as it is the most effective means of communications for achieving coordination.

    #Effective Leadership and Supervision:

    Management can achieve better coordination through effective leadership and supervision. Effective leadership ensures coordination both at the planning and the implementing stage. Effective supervision is also necessary to guide the activities of individuals in the proper direction. This will bring unity of action which is essential to coordination.

    #The Essay on the Nature of Co-Ordination:

    Co-ordination means an orderly synchronization of efforts of the people working in the organization for the achievement of organizational objectives. It is a continuous process of achieving unity of purpose in the organization.

    It includes all such deliberate efforts on the part of management whereby efforts of various parts of the enterprise are so blended that they move harmoniously towards the accomplishment of an organizational objective.

    Where a number of persons are working for the achievement of a common purpose, coordination is essential to achieve the purpose and synchronize their efforts. Co-ordination is an all-inclusive principle of organization. It is also the all-inclusive function of management and not just one of its functions.

    Management seeks to achieve co-ordination by performing various functions like planning, organizing, directing and controlling. When all these functions are related to each other harmoniously, co-ordination is achieved. As a matter of fact, coordination is the essence of managing.

    #The Essay on the Importance of Co-Ordination:

    In order to achieve coordination among the subordinates and sub-units, the management performs the functions of planning, organizing, staffing, directing and controlling. Coordination is required in every function of management. Plans of different departments and divisions must be properly coordinated, otherwise, the objectives of the organization as a whole cannot be accomplished,

    Co-ordination is equally important in organizing. All activities required to achieve the desired objectives must be properly grouped and assigned to the right people. In staffing, a balance must be attained between job requirements and the qualities of the personnel who are placed on different jobs.

    The direct function of management is an attempt at achieving coordination. Supervision, motivation, leadership, and communication are designed to secure unity of action in a group. Co-ordination is also involved in controlling. Corrective measures must be synchronized with the cause and time of deviations from the desired performance.

    Thus, coordination is the silken thread running through the entire process of management. That is why it is called the essence of management.

    Co-ordination results in the creation of a true whole that is larger than the sum total of its parts. The analogy of the conductor of a symphony orchestra is appropriate here. The conductor by his coordinating skills of vision, leadership and simultaneous attention to the totality of the orchestra group and its individual instrument players, creates a living musical performance and not mere noise.

    In any case, management has no alternative but to perform mediating, moderating and motivating roles in securing coordinated action. Mediation with the external environment, moderation while controlling internal environment and motivation of individual organizational members are integral coordinating functions of management.