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A Beginner’s Guide To Operations Management

Published on Sep 06,2022 24 Views


Have you thought about how goods and services by brands are delivered most effectively and practically? What goes behind the scenes that make the entire journey from production and supply to management seem perfect? A successful operations management in place is the secret sauce to the triumph of millions of organisations.

Operations management is an indispensable function that sets the foundation of any organisation. Without effective operations management, an organisation would be unable to produce goods and services efficiently or meet the needs of its customers. While it may seem like a complex and daunting topic, it doesn’t have to be.

In this blog post, we will provide a beginner’s guide to operations management (OM) and discuss some of the most important topics that you need to know. By understanding its basics, you can make more informed decisions about the business and its operations.

Why does Business Operations Management Hold Immense Significance?

“A recent study by the Harvard Business Review found that companies with superior operations management are twice as likely to ace the top quadrant of financial performance in the industry.” 

Operations management is a business vertical concerned with the production of goods and services. It involves the planning, scheduling, and controlling activities that transform inputs into outputs. Operations managers ensure that an organisation’s operations are efficient and effective. They must also ensure that the organisation’s products and services meet its customers’ needs.

In today’s competitive business environment, organisations need to have robust operations management processes in place. The goal of operations management is to optimise the use of resources that adequately cater to diverse customer requirements.

Operations management is concerned with all aspects of the production process, from sourcing raw materials to delivering finished products. It includes the management of facilities, equipment, and staff. OM is also responsible for the planning and execution of production tasks. Here are the core processes of OM:

Effective Production: It ensures that resources are used efficiently to produce goods and services. This includes reducing wastage and maximising the use of resources for product success.

Adequate Planning and Scheduling: It assures that production tasks are planned and scheduled to meet business goals, production capacity and customer demand.

Quality Control: OM is responsible for every step of quality check, ensuring that production and supply complement the business objectives and that finished products meet customer expectations.

Managing Facilities, Equipment, and Staff: It ensures that facilities and equipment are adequately maintained and that staff are appropriately trained and motivated towards the common goal.

Monitoring and Controlling the Production Process: This includes monitoring production metrics and making changes to the production process as needed.

Continuously Improving Efficiency: OM paves ways for improving the production process and making it more efficient.

Increasing Profitability: This is the ultimate goal of all businesses, and operations managers should always look for ways to increase profitability. 

Basic Principles Of Operations Management

Operations management is a complex field with many different aspects to consider. However, by understanding the basic principles of the operations management process, you can start to make a difference in your organisation. Implement these principles in your organisation, and you will soon see the benefits. Principles of OM, according to Randall Schaeffer.

  1. Reality: There is no perfect way to run an organisation, and there will always be room for improvement. OM process should focus on the core problem and work out ways to improve it.
  2. Organisation: Every organisation is different, and so the way you manage your operations will be unique to your company. You must understand your organisation’s strengths and weaknesses to ensure optimal results.
  3. Humility: The trial and error method is only advisable when you have enough resources and time. Hence, it is always essential to understand the limitation will allow you to work on the optimum capacity that brings results.
  4. Empowerment: Empower your employees to make decisions and take action. The more empowered they are, the more engaged they will be in their work.
  5. Communication: Clear and honest communication is the essence of successful operations management. Make sure everyone is on the same page, and don’t be afraid to give feedback.
  6. Accountability: It is important to be accountable for the results you bring as an operations manager.
  7. Quality Control: Quality control is essential to ensure that your products or services meet your customers’ needs. Use proven systems and tactics to track and improve quality over time.

These are only a few principles of operations management. With the appropriate implementation of these principles, you can start to make a difference in your organisation. You can soon reap the seeds of improved efficiency and productivity.

Want to learn the nitty-gritty of operations management and step into the shoes of an operations manager? We have an amazing and interactive course, i.e., Advanced Certificate in Ops, SCM and PM. Give it a try!

What Are The Strategic Operation Management Decisions?

Each decision in operation management has different implications and considerations, but all are important to the success of your business. Hence, these should be made considering the company’s goals, resources, and constraints. Here are a few of the strategic decisions that operations managers must make.

Operations and Supply Chain Management

The strategic decisions in these two areas mainly focus on the efficiency and effectiveness of the company’s production process. It overlooks the entire production process, from acquiring raw materials to delivering finished products to customers. The objective is to minimise waste and maximise resources while meeting customer demand.

Human Resources Management

The decisions are focused on attracting, developing, and retaining employees. This includes creating and enforcing employee policies to providing training and development opportunities. It creates a workforce that is skilled, motivated, and committed to the company.

Inventory Management

This is a critical area for any company that manufactures or sells products. The ideal objective is to keep enough inventory on hand to meet growing customer demand while not keeping much capital in inventory. It might be a challenging balance to strike, and the strategic decisions in this area are focused on achieving it.

Forecasting and Capacity Planning

Another critical area for manufacturing and selling companies is forecasting and capacity planning. This includes making decisions about what products to make, how much of each product to make, and when to make it. The intention here is to minimise the risk of overproduction or underproduction while being relevant to the target audience.

Facility Management

The strategic decisions in this area are focused on the layout, design, and maintenance of the company’s facilities. This includes everything from choosing the facility’s location to designing the production process’s layout. It helps in creating a safe and efficient working environment for employees.

Operations Scheduling

The final area of operations management is scheduling. This includes making decisions about when to start and finish each task in the production process. The goal is to minimise downtime and maximise resources while still meeting customer demand.

What Is An Operations Strategy? What Are Different Elements Of Operation Strategies?

An operations strategy is a plan for how an organisation will use its resources to create value for its customers. With an efficient operations strategy, the company can produce goods or services at a lower cost or generate more revenue than its competitors. The main aim of the operations strategy is to improve the company’s competitive position.

 

Crucial elements of operation strategy include:

Product Design: Product design involves creating products that meet customer needs and can be produced at a cost that allows the organisation to profit.

Product Assembly: Product assembly is the process of putting together the components of a product, making it profitable for the company and relevant for the customers.

Packaging and Shipping: Packaging and shipping are responsible for getting products to customers safely and promptly.

Supply Chain Optimization: Supply chain optimisation ensures that all components of the supply chain are working together efficiently to deliver products to customers.

Resource Scheduling: Resource scheduling is allocating resources, such as machines and workers, to tasks to meet production goals.

Quality Control: Quality control ensures that products meet customer quality standards and can be delivered on time.

Forecasting: It is a method of estimating future demand for products to ensure that the necessary resources are available.

Systems And Techniques To Improve Operation Management

Deploying the right mix of resources and processes is essential to achieving the desired outcome. There are a variety of different tools and techniques that can be used to achieve this goal.

One popular tool is known as Six Sigma. This methodology uses various statistical tools and techniques to identify and eliminate sources of waste and variation. Six Sigma has been proven to be an effective way to improve operations in multiple industries.

Another popular tool is lean manufacturing. This approach eliminates wasted time, effort, and resources by streamlining processes and eliminating unnecessary steps. Lean manufacturing has been an effective way to improve productivity and efficiency in various industries.

Both Six Sigma and lean manufacturing are popular systems that can be used to improve operations. There are a variety of other tools and techniques that can also be used. The best way to determine which approach is best for your organisation is to assess your specific needs and pick the best course of action.

Operations Management Changing The Dimensions Of The Business Industry?

The operations management field is evolving rapidly due to technological changes and the global economy. This has led to new challenges for businesses, which must now adapt their practices to stay competitive. As a result, the role of an operations manager is becoming increasingly important.

Operations managers are responsible for ensuring that all aspects of a company’s operations run smoothly and efficiently. This includes overseeing production, managing inventory, and coordinating the distribution of products and services. In addition, operations managers must be able to communicate effectively with other departments within the company to ensure that all goals are met.

The changing landscape of business has emphasised operations management more than ever. The rise of global markets and the need for faster turnaround times have made it essential for companies to have an efficient and effective operations management system in place. In addition, the increasing complexity of products and services has made it necessary for operations managers to adapt quickly to dynamic changes. 

Why Operations Management Is A Booming Field Of Opportunities?

Operations management is a vital business activity of managing the resources which are responsible for the creation and delivery of the company’s products and services. It includes the management of the processes which transform the inputs into outputs. The resources managed by operations managers include human resources, machines, materials, information, and energy.

Operations management is a significant part of any business and plays a vital role in the company’s growth. It is responsible for ensuring that the company’s products and services are delivered promptly and efficiently. OM is a very challenging field, requiring a lot of skills and knowledge. 

The operations manager must be able to plan, organise, control, and lead the activities of the operations team. He must also be able to make decisions in a fast-paced environment and must be able to handle the pressure of the job. Operations management is a growing field, and there are many opportunities for those who want to ace this ever-growing vertical.

“The operations management field has grown by 32 per cent from 2010 to 2020, according to the U.S. Bureau of Labor Statistics.”

This growth is expected to continue as businesses increasingly rely on operations managers to help them address the challenges encountered in this ever-changing business landscape. If you’re interested in starting a career in operations management, now is the time to strike while the iron is hot.

By taking the time to understand how it works and its objectives, you’ll be better prepared to impact your company’s bottom line positively. We are offering a brilliant certificate course that will make you future-ready. 

Take some time to check out our Advanced Certificate in Ops, SCM and PM. See what it has to offer in bringing your dreams to fruition. 

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A Beginner’s Guide To Operations Management

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