Introductions To Operations Management

SUMMARY OF INTRODUCTION TO OPERATIONS MANAGEMENT
Every business is managed through three major functions: finance, marketing,

and operations management. Finance is the function responsible for managing cash
flow, current assets, and capital investments. Marketing is responsible for sales,
generating customer demand, and understanding customer wants and needs. Most of
us have some idea of what finance and marketing are about, but what does operations
management do?
Operations are the part of the business organization that is responsible for
producing goods and services. Likewise, the Operations Management (OM) is the
management of systems or processes that create goods and/or provide services. It is
the business function that plans, organizes, coordinates, and controls the resources
needed to produce a company’s goods and services. It is a management function which
involves managing people, equipment, technology, information, and many other
resources. Operations management is the central core function of every company.
Without operations, there would be no goods or services to sell to customers. These
goods are the physical items that include raw materials, parts, subassemblies, and final
products. For example, automobile, computer, oven, shampoo. While services are
activities that provide some combination of time, location, form or psychological value
such as air travel, education, haircut and legal counsel.
On the other hand, supply chain is a sequence of activities and organizations

involved in producing and delivering a good or service. It involves managing the flow of
materials and information from suppliers and buyers of raw materials all the way to the
final customer. It is the network of entities that is involved in producing and delivering a
finished product to the final customer. The objective is to have everyone in the chain
work together to reduce overall cost and improve quality and service delivery. Supply
chain management requires a team approach, with functions such as marketing,
purchasing, operations, and engineering all working together.
Furthermore, the role of operations management is to transform a company’s

inputs into the finished goods or services. Inputs include human resources (such as
workers and managers), capital, land, labour, and information. Outputs are the goods
and services a company produces. Basically, operations management is responsible for
all aspects of the process of transforming inputs into outputs. This transformation
process also includes the measurement and feedback to continually adjust the inputs,
the transformation process, and the characteristics of the outputs. This transformation
process is dynamic in order to adapt to changes in the environment.
Therefore, it is important to study Operations Management (OM) because in

every aspect of business is affected by operations. Many service jobs are closely
related to operations such as financial services, marketing services, accounting
services, and information services. Through learning about operations and supply
chains one will have a better understanding of the world he live in, identify the global
dependencies of companies and nations, determine the reasons why companies
succeed or fail and the knowing the importance of working with others.
Moreover, when processes fail to follow a precise pattern it is a leading cause of

quality issues both in transactional and production processes called process variation.
There are four sources of process variation. The first one is the variety of goods or
services being offered. This means that the greater the variety of goods and services
offered, the greater the variation in production or service requirements. Second is the
structural variation in demand which is generally predictable. They are important for
capacity of planning. The third one is random variation or the natural variation that is
present in all processes and it cannot be influenced by managers. Lastly, is assignable
variation that has identifiable sources which can be reduced, or eliminated, by analysis
and corrective actions. Thus, variations can be disruptive to operations and supply
chain processes. They may result in additional costs, delays and shortages, poor
quality, and inefficient work systems. Hence, the role of operations management is
crucial.
In addition, the role of the Operations Manager is critical in implementing the right
processes and practices across the organization. The operations function consists of all
activities directly related to producing goods or providing services. A primary function of
the operations manager is to guide the system by decision making; system design
decisions and system operation decisions. System Design Decisions include capacity,
facility location, facility layout, products and service planning, acquisition and placement
of equipment. These are typically strategic decisions that usually require long-term
commitment of resources and determine parameters of system operation.
Aside from system design is the system operation. These are generally tactical
and operational decisions on management of personnel, inventory management and
control, scheduling, project management and quality assurance. Operations managers
spend more time on system operation than system design.
Moreover, when making a decision, modelling is a key tool used by the

operations manager. Model is an abstraction of reality; a simplification of something.
The common features of models; is they are simplification of real-life phenomena; they
omit unimportant details of the real-life systems they mimic so that attention can be
focused on the most important aspects of the real-life system. Some of the benefits of
models are the following; models are generally easier to use and less expensive than
dealing with the real system. It increase understanding of the problem and enable
managers to analyse “What if?” questions. It also serves as a consistent tool for
evaluation and provides a standard format for analysing a problem.
Additionally, many historical milestones have shaped Operations Management

(OM). Some of these are the industrial revolution, scientific management, the human
relations movement, management science, and the computer age. OM is highly
important function in today’s dynamic business environment. Among the trends with
significant impact are just-in-time, TQM, reengineering, flexibility, time-based
competition, SCM, global marketplace, and environmental issues. OM works closely
with all other business functions.
The scope of operations management ranges across the organization. The

operations function includes many interrelated activities such as forecasting, capacity
planning, facilities and layout, scheduling, managing inventories, assuring quality, and
motivating employees, deciding where to locate facilities and many more.
Along with some ethical issue arise in many aspects of operations management.
These are the financial statements, worker safety, product safety, quality, the
environment, the community, hiring and firing workers, closing facilities and worker’s
rights. While environmental concerns focused on sustainability, using resources in ways
that do not harm ecological systems that support human existence.
Besides, supply chain management (SCM) is the management of the flow of

materials from suppliers to customers in order to reduce overall cost and increase
responsiveness to customers. Some of the issues regarding the supply chain are the
following ; the need to improve operations, increasing levels of outsourcing, increasing
transportation costs, competitive pressures, increasing globalization, increasing
globalization, increasing importance of e-business, the complexity of supply chains, and
the need to manage inventories.
Hence, Operations Management (OM) gives an understanding of how to help an

organization gain a competitive advantage in the marketplace. Regardless of whether
the area of expertise is marketing, finance, MIS, or operations, the techniques and
teach how company can offer goods and services cheaper, better, and faster. Thus,
operations management concepts are far-reaching, affecting every aspect of the
organization and even everyday life.
WORD COUNT: 1,202
REFERENCES:
https://www.youtube.com/watch?v=DEuzzLled6k.Introduction to Operations
Management by Eddy Witzel.

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SUMMARY OF INTRODUCTION TO OPERATIONS MANAGEMENT

Every business is managed through three major functions: finance, marketing,

On the other hand, supply chain is a sequence of activities and organizations

Furthermore, the role of operations management is to transform a company’s

Therefore, it is important to study Operations Management (OM) because in

Moreover, when processes fail to follow a precise pattern it is a leading cause of

Moreover, when making a decision, modelling is a key tool used by the

Additionally, many historical milestones have shaped Operations Management

The scope of operations management ranges across the organization. The

Besides, supply chain management (SCM) is the management of the flow of

Hence, Operations Management (OM) gives an understanding of how to help an

WORD COUNT: 1,202

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