The following are the five limitations of planning:
(i) Rigidity: Planning is rigid in nature. Once a plan regarding the objectives to be achieved and the course of action to be followed is formulated, the manager may not be able to change it. Such rigidity creates hurdles, particularly at times of unforeseen situations. At times of unexpected situations, the managers may require certain degree of flexibility so as to cope with the changes in an appropriate manner. Thus, rigidity in plans sometimes creates obstacles in the accomplishment of organisational objectives.
(ii) Cannot deal with dynamic environment: Business environment is dynamic and uncertain. However, planning cannot foresee such changes and fails at times of changes and uncertainties. This may lead to failure in the accomplishment of objectives. An organisation must adapt its functioning to the changing environment.
(iii) Reduced creativity: In any organisation, planning is often done by the top management, while the lower and middle management just follow these plans. They are not allowed to deviate from the predefined course. They just implement and execute the plans as stated. Thus, they tend to follow the same thinking pattern as others and lose their own creativity. It is possible that they might have better ideas for the accomplishment of the objectives; however, due to lack of involvement in decision making, remain unheard.
(iv) Involve huge costs: Formulation of plans involves huge costs in terms of time and money. As planning is based on future predictions, it requires a lot of thinking and analyzing. Planning involves scientific calculations along with figures and facts, which are to be used in formulating the future course of action. This involves high costs. Moreover, sometimes, it might also happen that the benefits derived from planning fall short of the costs incurred.
(v) False security: Good planning may not guarantee success of an organisation. Often, managers tend to rely on pre-tested plans that have worked well in the past. However, they may not work well in the future as well. Many unforeseen changes can crop up that can fail a plan. Sometimes, managers think that planning can prevent problems from occurring. However, they neglect the fact that planning just provides a base for predicting the future. It does not give straight away answers to problems.