There are number of challenges facing many manufacturing companies today. Operations management has posed more challenges to operations managers/directors. The dynamics pose serious threat to the survival of the company and strategies have to be put in place to cope with these various challenges.
The market is continually changing and the conditions are quite scary. The market has shifted and keeps shifting. This calls for continual market study and quick response to the needs of the market. Production materials prices keep fluctuation/rising thereby causing unstable product prices. Buyers are luxurious products are coming down to buy standard products, and those buying standard products are now demanding for budget-priced products. The bulk of buyers for budget-priced products cannot afford them anymore and thus create vacuum in sales. This has greatly affected company's sales.
In Nigeria, for example, while recession is biting hard, prices have gone up and no increase in income. Income could not be raised for salary earners to curtail the rising USD rate to Naira and inflation. With raw materials prices changing every day, manufacturing company that largely depend on imported materials could not fully put all cost on products as customers may shift to a more inferior products as substitute. This calls for putting survival strategies in place.
The rate at which things are changing is unimaginable - prices, market, labour, machines, exchange rate, interest rate, etc. Many companies have to fold up. The protection of company's capital is becoming difficult. Other companies are relocating to neighboring countries where the environment and government legislation are favorable to their businesses.
Another challenge to modern manufacturers is that of global competition. Many companies have to cope with competing low-priced imported products. The cost of local production of many fast moving consumer goods is very high, starting with cost of power, especially in Nigeria and other African countries. Many of the big multinationals produce high volume of products and could afford to dump them in any country, especially those with poor import control and boarder problems.
These and more are the challenges facing modern manufacturers and operations chiefs need to be proactive. It is time to develop and deploy more strategies around operations - review strategies existing strategies to know those that are still working and relevant and discard those that obsolete. Operations managers have to keep abreast of future (coming) challenges to their business and prepare-ready to confront these challenges and still be able to maintain the company's balance.
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