The very essence of any business is to cater needs of customer by providing services and goods, and in process create value for customers and solve their problems. Production and operations management talks about applying business organization and management concepts in creation of goods and services.
Though many authors define the product with Consumer orientation, it is better for us to deal with different angles, because it will be helpful for us to understand the subject of production and Operation Management. (i) For a Consumer: The product is a combination of or optimal mix of potential utilities. This is because every consumer expects some use or uses from the product. Hence he/she always identifies the product in terms of the uses. Say for example-Soap can be identified by complexion, cleanliness of body, freshness, fragrance or health.... etc. Because of this, many producers advertise that they are selling health, or they are selling Cine star Complexion or they are selling freshness and so on. (ii) For a Production Manager: Product is the combination of various surfaces and processes (or operations). This is because the production Manager is solely responsible for producing the product. He has to think of the various surfaces by which the product is made of, so that he can plan for processes by which a particular surface can be made and plan for required capacity of the facility by which the surface is produced. While planning he has to see that the required surface is produced by the best and cheapest method (optimally), so as to make the product to face competition in the market. (iii) For a Financial Manager: For him the product is a mix of various cost elements as he is responsible for the profitability of the product. (iv) For a Personnel Manager: For him the product is a mix of various skills, as he is the person who selects and trains the personnel to meet the demand of the skill to produce the product. In general we can define the product as a bundle of tangible and intangible attributes, which along with the service is meant to satisfy the customer wants.
Production means application of processes (Technology) to the raw material to add the use and economic values to arrive at desired product by the best method, with out sacrificing the desired quality. We have three ways of Production, they are: (i) Production by Disintegration: By separating the contents of Crude oil or a mixture the desired products are produced. For example the crude oil is disintegrated into various fuel oils. Similarly salt production is also an example for product produced by disintegrated. We can use Mechanical or Chemical or both technologies to get the desired product, so that it will have desired use value. (ii) Production by Integration: In this type of Production various Components of the products are assembled together to get the desired product. In this process, Physical and Chemical Properties of the materials used may change. The examples are: Assembly of Two wheelers, Four wheelers and so on. (iii) Production by Service: Here the Chemical and Mechanical Properties of materials are improved without any physical change. The example for this is Heat Treatment of metals. In real world, a combination of above methods is used. In general production is the use of any process or procedure designed to transform a set of input elements into a set of output elements, which have use value and economic value.
Management can be explained as an art or science, (in fact it is a combination of art and science) of getting things done by the people, by planning, coordinating, organizing, directing and controlling the activities to meet specified goals, with in the frame work of agreed policies. The above explanation put emphasis on getting things done, Planning, Organizing, Coordinating, and controlling and specific objectives and agreed policies. Today’s...