Operations Notes Essay

Submitted By mazdogs
Words: 8673
Pages: 35

Role of operations management
-Operations refers to the business process that involve transformation or, more generally production. It is a term that applies to both the manufacturing and service sectors
-In manufacturing operations refers to the processes involved turning raw materials into outputs of finished good or products
-Transformation is the conversion of inputs (resources) into outputs (goods and services) -Value adding is the creation of extra or added value as inputs are transformed into outputs
-Operation processes are broad they include:
-The production of goods and services
-Production controls and associated quality controls on processes. Included are input management and capacity (volume of output)
-Inventory controls
-Supply chain management
-Logistics and distribution
-Management decision making in terms of operational processes
-Effective operations management adds value to the business by increasing productivity, reducing costs and improving quality. This is to achieve strategic competitive advantage through lower costs and/or differentiated goods

• Operations - inputs and outputs
-Operations can be described as the transformation process that turn inputs to outputs.
Inputs can be either tangible e.g raw materials, land labor as well intangible inputs such as ideas and transformation

• Operations and the customer focus
-Change has occurred from where operations function was considered hidden (customers were not relevant to production). Customers and customer relationships have changed
(customer comes first). Customers needs are not always obvious, customer might desire firms to engage in processes that:
‣ Waste minimal resources in their production - lean production
-Lean production aims to eliminate waste at evert stage of production. It involves analysing each stage of the production process, detecting where inefficiencies are and correcting them
-Waste adds cost, if waste can be minimised then production processes are more efficient
-Was ca be, under use of labour, over production, errors and defects requiring remediation or creating loss product

Reflect fair value for any labour used in processes
-That businesses operate fairly and compensate and treat employees appropriately. The growth of fair trade movement is a direct result of consumer advocating for businesses integrate notions of fair price, decent working conditions


Operate at low coast so as to maximise affordability
-Customers seek goods and services at low costs (affects the operations), businesses aim to maximise profitability through sales revenue. Business will minimise production costs so that the retail prices for consumers are reasonable


Integrate environmental awareness and a need for ecologically sustainable practices -Customers express concern about stat of the environment, business needs to reflect ecologically sustainable practices. Reflect processes related to operation functions e.g reduce green house gases, reduce waste, save electricity, recyclable materials


• Strategic role of operations management – cost leadership, good/service differentiation -Strategic: means ‘affecting all key business areas’; that is, the strategic role of the operations management involves operations managers contributing to the strategic direction or strategic plan of the business
-Operations management is an essential key business function that overlaps all business functions such as marketing, finance, HRM (strategic means affecting all key business areas) -The overarching business goal of a business it to maximise profit, this is done by revenue or income and costs or expense
-Revenue or income should be maximise so as to bring greatest possible volume of money. Cost needs to be minimised in order to reduce overall expenses
-Profit centres are those aspects of a business that directly derive income
- A strategic aspect of operations management is therefore the management of…