Operations

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Common Challenges in Operational Planning

A lack of collaboration with sales leaves operations teams blindfolded leading to  inefficiencies, missed opportunities, and financial instability.

#1: Mismatch between supply and demand

This is arguably the biggest challenge. Without sales' input on anticipated demand, operations cannot accurately plan for production levels, raw material procurement, or staffing needs. This results in either: (a) Overproduction, which leads to wasted materials, excess inventory, storage costs, and potential obsolescence or (b) Underproduction, which leads to stockouts, lost sales, dissatisfied customers, and damage to brand reputation. In service-based businesses, Operations won't know when to hire, train, or reallocate staff if they don't have a reliable projection of workload driven by sales. This can lead to overworked employees, burnout, and high turnover during peak periods, or idle staff during slow periods.

 
#2: Logistical bottlenecks

Without knowledge of where and when products need to be delivered, operations may struggle with efficient logistics, leading to delays, increased shipping costs, and customer dissatisfaction.

#3: Poor Technology and infrastructure planning

Decisions about investments in new equipment, software, or facilities will be made in a vacuum, potentially leading to underutilized assets or insufficient capacity to meet future demand.

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