Business – 4.1 The nature of operations – Operations methods | e-Consult
4.1 The nature of operations – Operations methods (1 questions)
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Key problems include:
- High capital investment – purchasing and installing new machinery requires large upfront expenditure, which can strain cash flow and increase financial risk.
- Skill mismatch and training needs – existing staff may lack the technical skills to operate and maintain automated equipment, leading to the need for extensive training programmes or recruitment of specialised personnel.
- Disruption to output – the transition period often involves downtime, trial runs and teething problems, causing a temporary fall in production volumes and possible loss of market share.
- Resistance to change – employees may fear job loss or feel insecure about new technology, which can lower morale and increase turnover.