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BSA 3A
OPERATION MANGEMENT
1. Introduction
1.1 What is Operations Management?
Operations Management is about how organizations produce or deliver the goods and
services that provide the reason for their existence. Operations can be seen as one of
many functions (e.g. marketing, finance, personnel) within the organization. The
operations function can be described as that part of the organization devoted to the
production or delivery of goods and services. This means all organizations undertake
operations activities because every organization produces goods and/or services.
Operations management can be defined as the systematic direction and control of the
processes that convert inputs into finished goods and services. In most organizations the
operations function involves a significant percentage of the employees and physical
assets of the organization. Operations managers are always concerned with each step in
even providing a single service or a product. At all times, they analyze what equipment,
labor, tools, facilities, materials, energy, and information should be included into an
operating system and how these inputs can be best obtained and used to satisfy the
requirements of the current market place. Operations managers are also responsible for
critical activities of the organization such as, capacity planning, quality management and
control, materials management, purchasing, and scheduling.
In recent years, the importance of operations management has increased dramatically.
Increasing foreign competitions, shorter product and service life-cycles, highly educated
and quality conscious consumers, and the upcoming advanced new technologies have
placed tremendous pressures on the operations function of the organization, to improve
productivity and quality while providing a broader range of high-quality products and
services.
With the increasing globalization in the markets, companies are recognizing that the
operations function can be used to strengthen their position in the market place.
Managers in operations management are playing a strategic, tactical and a vital role in
satisfying customer needs and making their organizations strong international
competitors.