The Problem with Central Planning

Centralized planning is a logical consequence of the application of Industrial Age principles and the state of the art of communications and computing in the Industrial Age. But centralized planning does not work well when faced with very dynamic and complex situations. Centralized planning does not work well in a coalition environment where the participants have overlapping objectives but different priorities, perspectives, and constraints.

Centralized planning is a manifestation of a belief in the ability to optimize. For centralized planning to work, it must be possible for a relatively small group of people to do all of the following: make sense of the situation, maintain this understanding in the face of a dynamic environment, predict the future, develop an appropriate response strategy, decompose the response into a coherent set of executable tasks, allocate resources, task subordinates, monitor execution, and make adjustments as required, all in a timely manner. In fact, despite a belief in the power of reductionism and a strong desire to optimize, centralized planning has evolved into a set of processes that often prevent optimization. Ironically, centralized planning processes are designed to deconflict tasks and elements of the force so that they will not get in each other’s way or do harm to one another. They prize deconfliction over synergy. This prevents simultaneity and the synergies necessary to perform anywhere near optimality. Centralized planning is antithetical to agility because it (1) is relatively slow to recognize and respond to changes in the situation, (2) results in ill-informed participants, and (3) places many constraints on behavior.

Source: Power to the Edge: Command and Control in the Information Age (Information Age Transformation Series) (2003) by David S. Alberts and Richard E. Hayes.

This is why communism failed and why socialism in all manifestations will always fail. Central planning is the antithesis of ingenuity and spontaneity.