What were the immediate consequences of centralised planning ?
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Centralized planning means that decisions are not taken independently at local level, but holistically at a more central level.
Why optimize Centralized planning?
The advantage is that planners can optimize over multiple locations, and by this, apply synergies, e.g. transport optimization over depots, or improve employee efficiency by reassigning them to another location. In general it implies that planners are physically at a centralized location, hence not near a location where the production or services take place. It is easier for the planners at a central location to exchange best practices, to increase transparency of the way of working, and increase the span of control. Also in this way unnecessary costs can be avoided (hiring extra employees in one location, while having overcapacity in the other) as well as leveraging in purchasing through the economies of scale.
Why optimize Centralized planning?
The advantage is that planners can optimize over multiple locations, and by this, apply synergies, e.g. transport optimization over depots, or improve employee efficiency by reassigning them to another location. In general it implies that planners are physically at a centralized location, hence not near a location where the production or services take place. It is easier for the planners at a central location to exchange best practices, to increase transparency of the way of working, and increase the span of control. Also in this way unnecessary costs can be avoided (hiring extra employees in one location, while having overcapacity in the other) as well as leveraging in purchasing through the economies of scale.
NashiS:
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