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INTRODUCTION OF OPERATIONS MANAGEMENT 1. 2. 3. 4. 5. 6. 7.

4 primary business functions,

Meaning of operation management, Carrier opportunities, Historical development in POM,

Factors affecting operation management, Operations as a system,

Decision making in operation management.

1. 4 primary business functions:-

There are 4 primary business functions; those are Marketing, Finance Human Resources and Operations. Business cannot succeed without operations, marketing, &finance. Managers in the marketing function are responsible for creating a demand for an organizations product & services.

Managers in the finance function are responsible for achieving the financial objectives of firm/industry. Operation manager manages business algorithms with efficiency. Without operations, no products or services could be produced; without marketing no product or services could be sold; and without finance/accounting; financial failure would surely result. Whereas production, marketing & finance act independently to achieve their individual function goals, they act together to achieve the organizations goal. For the achievement of organizations goal i.e. profit, survival & growth in a dynamic business climate requires co-operative teamwork among these primary business functions.

2. Operations Management:Operations management is the management of organizations productive resources or production system, which converts inputs into the organizations products and services. A production system takes inputs- raw material, personnel, machines, buildings, technology, cash, information, and other resources- and converts them into outputs-products and services.
>Conversion process> INPUTS ->>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> >>>> PTODUCTS AND SERVICES.

This conversion process what is called Operations or Production and is the predominant activity of production system.

Operations managers, manage the production system, their primary concern is with the activities of the conversion process or production. Some organizations have only a production manager; some have only an operations manager. Today this discipline is generally referred to simply as operations management, but includes both the management of production activities and the management of other operations. Good operations decisions can improve the value of company by increasing profitability and growth. Understanding the fundamental concepts of operation management and being able to use a variety of common decision-making tools and problem solving approaches is key to making better operations decision. Better management of a companys operations can add substantial value to the company by improving its competitiveness and long term profitability.

HUMAN RELATIONS AND BEHAVIORALISM

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Succeeding in todays global business environment depends more than ever on tapping the underutilised capabilities of employees. Operations managers must therefore attempt to create an organisational climate that encourages employees to devote their energy and skills to the achievement of organisational objectives. OPERATIONS RESEARCH

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The concepts of total system approach and of interdisciplinary teams and the utilisation of complex mathematical techniques evolved as a result of the chaotic conditions existing in the huge military organisations involved in World War II During the post-war era, operations research has been and perhaps still is known chiefly for its quantitative techniques, such as linear programming, PERT/CPM and forecasting models. Operations research helps operations managers make decisions when problems are complex and when the cost of a wrong decision is high and long lasting.

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Operations research commonly analyse the following problems:

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A company has 12 manufacturing plants that ship products to 48 warehouses nationwide. To maximise profits, how many units of each product should be shipped from each plant to each warehouse each month/

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A firm contemplates building a $157 million production facility. The project involves company resources, 2 prime contractors, and 75 subcontractors over a four year period. How can the company plan the completion of each activity of the project and the use of workers, materials and contractors so that the cost and the duration of the project are minimised.

CHARACTERISTICS OF OPERATIONS RESEARCH

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OR approaches problem solving and decision making from the total systems perspective. OR doesnt necessarily use interdisciplinary teams, but it is interdisciplinary, it draws on techniques from sciences such as biology, physics, chemistry, mathematics and economics and applies the appropriate technique from each field to the system being studied. OR doesnt experiment with the system itself but constructs a model of the system on which to conduct experiments Model building and mathematical manipulation provide the methodology that has perhaps been the key contribution of OR.

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The primary focus is on decision making. Computers are used extensively.

Factors affecting Operations Management:

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Reality of global competition. Quality, Customer Service and Cost Challenges. Rapid expansion of advanced technologies. Continued growth of Service Sector. Scarcity of Operations resources. Social Responsibility issues.

Thus, to succeed in global competition, companies must make a commitment to customer responsiveness and continuous improvement towards the goal of quickly developing innovative products and services that have the best combination of exceptional quality, fast and on time delivery and low prices and costs. Operations as a system: A system is a whole that cannot be take apart without loss of its essential

characteristics and hence it must be studied as a whole . An operation or production system receives inputs in the form of materials, personnels, capitals, utilities and information. These inputs are changed in a conversions subsystem, in the desired products and services, which are called outputs. A portion of the output is monitored in the control system to determine if it is acceptable in terms of quantity, cost and quality. Decision Making in POM Strategic , Operating and Control Decisions Strategic decisions: Decisions about products ,processes, and facilities. These decisions are of strategic importance and have long-term significance for the organizations. Examples of this type of planning decisions are:

Deciding whether to launch a new product development project. Deciding on design for production process for new product. Deciding what new facilities are needed and where to locate them.

Operating decisions : Decisions about planning production to meet demand. These decisions are necessary if the ongoing production of goods and services is to satisfy the demands of the market and provide profit for the company. Examples of this type of decisions are :

Deciding how much finished-goods inventory to carry for each product. Deciding how many temporary employees to hire next week. Deciding how much to purchase from each vendor next month.

ontrol decisions :

Decisions about planning and controlling operations. These decisions concern the day-to-day activities of workers , quality of product and services ,production and overhead costs and maintenance of equipment . Examples of this type of decisions are:

Deciding what to do about a departments failure to meet the planned labor cost target. Developing labour cost standard for a revised product design that is about to go into production.

Deciding what the new quality control acceptance criteria should be for a product that has had a change in design.