It is true that departmentation is helpful to the enterprise in many ways. But it is not free from limitations. Its main limitations are:
- There is the problem of co-ordination. The greater the number of departments, the more difficult will be the task of co-ordination.
In this connection, it may be noted that the lack of proper co-ordination would impair the managerial efficiency and the overall results of the enterprise.
- There is also the problem of communication. The work of communication becomes more difficult.
- Under departmentation, there is also the problem of supervision and control.
- Departmentation is expensive in terms of money and efforts. In other words, it increases the cost of managing the concern.
- Under departmentation, because of the layering of executives, the operative personnel are far removed from the top management.