Welcome to Production/Operations Management
Operations management may be defined as the design, operation, and improvement of the production systems. A production system uses firm's productive resources to transform inputs into some desired outputs (primary products or services) in order to achieve the goals of the firm. Through the creation of the outputs, the firm can add value to various inputs. The addition of value at a level exceeding the cost of adding it provides the potential for profitability. The essence of the operations is to add-value during the transformation process. Thus, the greater the value added, the greater the amount of funds available for research and development, investments in new facilities and equipment, and profits. High value added enables companies to initiate successful competitive maneuvers. Failing to generate value added may result in business disaster. To generate more value added requires to achieve productive use of the firm's resources. The term productivity, which is usually expressed as the ratio of output to input, is used to describe this.
Operations management is a functional field of a business organization, with clear line management responsibilities. Decision makers or the managers in this field deal with both people and technology. Thus, they need to know the basic understanding of the technology used in production systems and to have adequate knowledge of the work they are to manage and the ability to work with other people. The major responsibility of an operations manager is to provide guidance to the operating system by making decisions related to either system design or system operation. These decisions are closely interspersed with other activities within other functional areas such as marketing, finance, management information systems, logistics, and personnel. Functional areas may be categorized into two groups: core functions and supporting functions. A typical business organization has three core interdependent functions: finance, marketing, and operations. All other functional areas exist to support these core functions. Although all functions act different, they perform related activities necessary to serve the mission of the organization and to achieve its goals. Actions taken in one functional area will have a major impact on the financial success of the firm due to their influence on the organization's productive assets.
You may wonder by now why you need to study operations management. I would like to have your attention to that operations is the place the actual transformation takes place. It is the basic function regardless of what business companies are in. The results of a recent empirical study reveal that about 35 percent of the job openings were in operations function related areas such as customer service, quality assurance, production planning and control, scheduling, job design, and inventory management. Moreover, job openings in all other areas such as finance, marketing, accounting, human resources, logistics, and purchasing are all interrelated with activities performed by operations. Many of you are soon will be actively engaged in this so-called real world. If you are a business student, regardless of your major, you no doubt have to take a course that is often called production operations management. Companies hiring business graduates are now expecting them to speak knowledgeable about many issues in the operations field. If you are to be a manager, you may face a wide range of responsibilities such as
monitoring existing work for your customers,
assigning new work to your staff as it is received,
devoting considerable time to making sure your unit has the human resources, training, equipment, and technology needed to provide customers with high quality products or services in a timely manner,
evaluating new tools and technologies,
designing new products,
restructuring the production process,
forecasting sales and staffing needs,
designing jobs so that your staff can progress to positions of leadership, and
giving constant attention to high quality in the products or services delivered to customers and the work done for the company.
If you seek a career in the operations field, you may want to know what formal positions will be available to you. Such formal positions include but not limited to:
Thus, in short, operations management includes forecasting, capacity planning, facility location, scheduling, managing inventories, assuring quality, motivating employees, and more.
So, what do you think?
Production and operations management may seem foreign to you if you do not plan a career in production or operations. Even students in professional fields such as engineering and business seem that they do not envision themselves as being involved in producing products or providing services, rather, they anticipate having responsibilities in other functional areas such as accounting, finance, marketing, human resources, and management information systems. Yet, the fact is that activities in each other functions of a firm are closely involved with the production and distribution of goods and services. The more managers know about the system producing the firm's goods and services, the better able they are to design, market, finance, and manage the activities of the firm. Thus, the problems they face are the same as the problems encountered in the operations function.
Well, still thinking?
I think, now, it is clear why you should take operations management courses and how they will be of value to you. So, welcome to operations management :). Lets have a fruitful journey together with one of my buses. Let me, the instructor, be the driver :).