Operations Management

OPERATIONS MANAGEMENT

Defining Operations Management

Operations Management often described as Production and Operations Management (POM) relates to the management of such systems. It refers to the activities, decisions and responsibilities of managing the resources which are dedicated to the production and delivery of products and services. Up to the 1970s Operations Management was considered as a ‘centre’ system with its basic focus on ‘cost reduction’. Since the 1990s, it has been increasingly recognized as a ‘basis’ for ‘value creation’ within the organization.

There are two ways- traditional and modern – in which Operations Management is viewed:

Traditional view perceives Operation Management as a system that is involved with the manufacture and production of goods and services.

Modern view perceives Operation Management as a system designed to deliver value.

Transformation Approach

Operations Management has a number of functions to carry out the transformation process effectively. The functions incorporate different roles that are interdependent but which can be grouped under five main headings:

* Product: The role of Operations Management is to ensure that the product is manufactured as per specifications and the plan.

* Plant: In order to make the product, plant and equipment is required; Operations Management has to consider that the plant meets specifications and is in keeping with the requirements.

* Process: There are many ways of producing the product, and Operations Management has the responsibility of choosing the best way.

* Program: The production program ensures that the schedules of production are met.

* People: Production depends on people and their skill and motivation. Operations Management has to ensure that skilled and motivated workers are available.

Value Driven Approach

The Value Driven approach starts by recognizing that a business is a ‘set of processes’, each of which has inputs, outputs, and...