Features And Limitations Of Planning


Planning is an indispensable activity for businesses. The management of all active firms plans for the future to make various decisions about the factors that affect business activities. Planning is an integral part of all departments of a business. It involves making predictions and forecasts about the future and preparing the present terms based on the predictions and forecasts to meet future goals and aims for the organization.

Planning is also important for the execution of the best practice principles and following the success stories of the other firms in the different markets. That is why companies compare the plans made for themselves with the plans of other companies often to repeat the profit ideas.

Features of Planning

It is a fact that businesses do not have any other option to control and manage their firms without the help of planning. By effectively planning and efficiently employing the terms of the plan, the firm may reach its goals one step at a time.

Following are the features of planning −

Future-oriented goals

Planning is a future-oriented process. The aim of planning is to meet a future goal. By planning ahead of time, managers tend to achieve aims that are set for the future. Every company and every department of a company sets goals for the future and tries to chive them by following the steps included in the planning process.

Pervasive process

Planning or goal setting is a pervasive process. All departments and associated bodies must work in progress to achieve common goals on behalf of the organization. Although the aims and goals of the organization stay the same, the various levels of management work on different aspects of the organization. The top management thinks for the entire organization and sets the bigger outline to be achieved by the employees of the firm. Middle-level managers have to manage the departments while the lower-level management has to oversee the daily activities of the firm.

Objectives must be defined

Objectives of planning must be defined well enough. This is done to move the organization in the required direction. Without objectives, the firm may get disoriented and unorganized. Therefore, defining objectives is one of the most important characteristics of a firm.

The primary function of the management

Among all of the functions that a firm’s management has to perform, planning is the primary among all of them. Planning must be done to prepare and manage other functions as well as to give the organizational processes a stable direction.

Continuous process

Planning is a perpetual process where the needs of the firm have to be ascertained continually to meet the new demands and resources that are deemed suitable from time to time.

Decision making

As feasibility and success of the plan depend solely on decision making, decision making is an integral part of planning. It is therefore obvious that when better outcomes are desired in the future, the decisions taken in the present must be good enough.

Mental exercise needed

Managers have to think critically in order to be successful in planning. Therefore, one needs to do enough mental exercise to become a successful planner. Moreover, since the process of planning is a team task, the management often needs to think in sync. Therefore, mental exercise is an indispensable part of planning.

Achieving the objectives is a goal in itself

Although plans contain objectives it is a matter of note that to achieve the planned objectives, some objectives to stay on track must be followed. By maintaining discipline and staying on the given path of objectives, the final goals of planning may be achieved. Therefore, it is a day-to-day management task to manage objectives while planning for the future of the organization.

Forecasts must be made

Planning is the process of forecasting the future depending on past and present trends. The management looks at present and past records in order to make a forecast for the future which is termed planning. Plans are therefore future-looking or forwarding in nature.

Intellectual process

Planning is an intellectual process where vision, ideas, forecasts, knowledge, imagination, and logical thinking are used. It is different in nature from other forms of activities of the organization.

Limitations of Planning

All firms plan their future and planning is an indispensable part of business organizations. However, there are limitations to planning. Some of the limitations are as follows −

May become dysfunctional

Plannings are sometimes non-functional in a continuous or dynamic system.

For example, in the case of natural calamities, planning may become non-functional and new plans must be made to lead the company to meaningful ends.


Plans are rigid in nature in the sense that employees have to stick to the plans even if they know a better process to perform the task. The management decides the rules and they are applied equally in the departments. The distribution of responsibilities may also not be flexible enough in the organization.

Costly process

Planning is a costly option for firms because taking expert help, acquiring facts and data, and having meetings are costly in nature. Therefore, planning may not be a feasible option for a firm that is yet to incur enough profit.


Planning requires enough time to get completed. As past data, present situations, market conditions, and organizational factors are considered, then collated, and finally implemented in the planning process; it takes a considerably longer period of time to actually be ready.

Lack of creativity

The top-level management usually forms the plans and employees have to follow them. Employees cannot add any suggestions that may be creative in nature. Therefore, planning may be devoid of creative pursuits in nature.

Moreover, as the employees cannot take part in the process of innovation in most firms, the benefit of creativity is lost from the big scenario.

May not guarantee success

Although the management takes enough care while planning, it is an activity related to the future which has no guarantee. The best information, data, and knowledge may not be accurate in defining future trends or situations.

So, planning is a process that is doubtful in terms of the success of an organization. In fact, no one knows what the future holds and hence even the best of plans may go wrong when the winds blow in opposing directions.


It has been observed that companies that plan well in advance have a competitive edge over their competitors. This is so because plans make businesses more disciplined and also give the firm a new direction that is prosperous in nature.

Although plans do not guarantee success; still they are one of the most useful ways to achieve the goals of an organization. That is why firms pay so much attention to planning.

In a nutshell, planning can be a productive process for firms if it is made economically, keeping the nature of business in mind.


Qns 1. Name three distinct features of planning.

Ans. Three distinct features of planning are −

  • They are future-oriented in nature.
  • They are the primary function of an organization, and
  • They are pervasive in nature.

Qns 2. Give three limitations of the planning process.

Ans. Three limitations of planning are −

  • They are rigid in nature.
  • Planning for the future is often costly.
  • They don’t guarantee success.

Qns 3. Why do businesses plan even when there is no guarantee of success due to planning?

Ans. Businesses have no other option than planning to forecast and manage the future better for the organization. Although planning does not guarantee success, skilfully made plans often work well and bring the required changes and profitability to the firms.

Updated on: 13-Oct-2022

1K+ Views

Kickstart Your Career

Get certified by completing the course

Get Started