Question

Explain briefly the external limitations of planning.

Answer 1

External Limitations of Planning:

Sometimes planning fails due to following limitations on which managers have no control.

(i) Natural calamity:

Natural calamities such as flood, earthquake, famine etc. may result in failure of plan.

(ii) Change in competitors’ policies:

Sometimes plan may fail due to better policies, product and strategy of competitor which was not expected by manager.

(iii) Change in taste/fashion and trend in the market:

Sometimes plans may fail when the taste/fashion or trend in market goes against the expectation of planners.

(iv) Change in technologies:

The introduction of new technologies may also lead to failure of plans for products using old technology.

(v) Change in government/economic policy:

Managers have no control over government decisions. If government economic or industrial policies are not framed as expected by manager then also plans may fail.