- In the previous installment we have been looking at marketing, we have also looked at human resources management
- It is time to look at another important business function namely operations management
- Operations management is often colloquially referred to as production
- However, while operations management covers the conversation of inputs (typically raw materials in a business that produces physical goods) and their conversion to finished goods, it encompasses more than that as you will see later on
- Operations management is the process of managing the production of goods and services.
- It involves planning, organizing, and controlling all the activities involved in the creation of products and services.
- Operations managers are responsible for ensuring that the organization’s resources are used efficiently and effectively to meet the organization’s goals.
What is Operations Management?
- Operations management is the design, management, and control of the production process.
- It is concerned with the transformation of inputs (raw materials, labour, capital) into outputs (goods and services).
- Operations managers are responsible for overseeing the entire production process from start to finish.
Relationship with other functional departments:
- Operations management is closely related to other functional departments such as marketing, human resources, finance, and accounting.
- Marketing and operations management work together to develop new products and services that meet customer needs.
- Human resources and operations management work together to recruit, train, and retain employees who can help the organization meet its production goals.
- Finance and operations management work together to ensure that the organization’s financial resources are used efficiently.
Main Aims of Operations Management:
- To improve the efficiency and effectiveness of the production process.
- To reduce the costs of production.
- To increase the quality of products and services.
- To meet customer demand in a timely manner.
- To ensure that the organization’s resources are used efficiently and effectively.
Why Operations Management is Important:
- Operations management is important because it directly impacts the organization’s ability to compete in the marketplace.
- By improving the efficiency and effectiveness of the production process, operations managers can reduce costs and improve the quality of products and services, which can give the organization a competitive advantage.
- Operations management is also important because it ensures that the organization is able to meet customer demand in a timely manner.
Main Objectives of Operations Management:
- To ensure that the organization’s resources are used efficiently and effectively.
- To improve the quality of products and services.
- To reduce the costs of production.
- To ensure that the organization is able to meet customer demand in a timely manner.
- To ensure that the organization is able to compete effectively in the marketplace.
- All the above can be summarised effectively into three main categories:
- Efficiency of production – produce at the lowest possible cost
- Quality – maintain quality standards and keep improvising
- Flexibility and innovation – keep adapting to the dynamic business environment
