Final answer:
Planning is often seen as less valuable by some firms due to the never-ending nature of the planning process, uncertain return on investment, and the high risk associated with long-term forecasts, especially when variable inflation impacts price stability and market equilibria.
Step-by-step explanation:
Some firms view planning as a waste of time because the process is never-ending and the return on investment is too low. A primary concern is that business environments are rapidly changing, and long-term planning can be rendered obsolete by new technologies or market shifts. High and variable inflation adds another layer of complexity, weakening the incentives for firms to plan far into the future due to uncertain future costs and prices. Markets are more likely to adjust unpredictably, leading to surpluses and shortages that can derail long-term plans.
Further, firms face the challenge of making current investments to earn future profits, which requires raising financial capital upfront. This creates an inherent risk, as the future financial landscape is unpredictable. With no certain returns, firms might find the planning process less rewarding compared to opportunities available in the short run.
Lastly, the idea of a static master plan is often unrealistic in the face of the dynamic nature of markets and economies. A steady state economy might be an ideal concept, but in practice, businesses need to adapt continuously to survive, thus making extensive long-term plans less appealing in environments characterized by rapid change and uncertainty.