Planning is advantageous to an organization, particularly in the creation of new ventures. According to an often-cited survey, as many as 65 percent of all newly started businesses are not around to celebrate a fifth anniversary. This high failure rate seems primarily a consequence of inadequate planning. Successful businesses have an established plan, a formal statement that outlines the objectives the organization is attempting to achieve. Planning does not eliminate risk, of course, but it does help managers identify and deal with organizational problems before they cause havoc in a business. Which of the following best expresses the main point of this paragraph?
A) Adequate planning eliminates business risk.
B) All ventures have a 65 percent chance of failure.
C) Existing businesses do not derive as much value from planning compared to new ventures.
D) Effective planning helps managers identify and plan for all organizational problems.
E) Companies that plan well appear to have a better chance at success.

Question

Quizplus · Accepted Answer

The paragraph highlights that planning is crucial for the success of new ventures, as inadequate planning is often the reason for their failure. Successful businesses have a formal plan that helps managers identify and deal with organizational problems before they cause damage. Thus, companies that plan well have a better chance at success.

Planning Is Advantageous to an Organization, Particularly in the Creation