What is the limitations of planning

Internal limitations of planning are:

• Planning leads to rigidity Once the plans are made it is difficult to change them.
• Planing does not work in dynamic environment Business environment is constantly changing. Planning cannot foresee everything and thus, there may be obstacles to effective planning.
• Planning reduces creativity Planning in done by top management. Middle level management merely follow the plans and are not permitted to act on their own. Thus, initiative and creativity gets lost in the process.
• Planning involves huge costs A lot of expenditure in the form of research, meetings, etc is incurred.
• Planning is a time consuming process Sometimes a lot of time is taken in drawing up plans and hardly any time is left for its implementation.
• Planning does not guarantee success Mere making of plans and not implementing them in their true sense, makes the plans useless.

External limitations of planning are:

• Unforeseen events Natural calamities like floods, earthquakes, etc are beyond the control of managers, that cause failure of plans.
•  Political outlook Political outlook towards industries and their intervention also affects the company’s plans.
• Environmental changes Changes in social, economic, legal and technological environment may affects forecasting and planning.
• Competitors’ strategy Sometimes, a change in the strategy of competitors may lead to failure of planning.