Operations Management in Daimond Manufacturing

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  • Published : May 21, 2013
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ge1 Operation Management

1.1 Definition
Operation Management is the activity of managing the resources which produce and deliver goods and services (Slack et al, 2010). These activities commences from the very initial production stage of information gathering right up to the final stage of consumer consumption of the product. Every organization does operation management even if they do not notice it. All organizations produce goods and/or services and to create goods and/or services, the organization must perform a number of operations which must be effectively and efficiently managed.

1.2 Role of Operations Management
Operations Management is of prime importance in all sectors, cells, functions, units and groups within the organization. An organization is a system and according to the business dictionary, (http://www.businessdictionary.com/definition/system.html) a system is ‘An organized, purposeful structure that consists of interrelated and interdependent elements (components, entities, factors, members, parts etc.). These elements continually influence one another (directly or indirectly) to maintain their activity and the existence of the system, in order to achieve the goal of the system’.

Read more: http://www.businessdictionary.com/definition/system.html#ixzz2QSyXAP1f . All employees are part of this system and have a common interest in making the consumer to receive goods and/or services in the best way possible. So I will say every manager in every part of the organization is to some extent an operational manager. According to James (2011), the role of operations management is to manage the transformation of an organization’s inputs into finished goods and services using processes. Processes are actually present in all areas of the organization from Human Resource to Finance to Marketing to Procurement etc.

1.3 The ‘Input – Transformation – Output’ process
Resources can either be transforming resources or transformed resources. After the transformation process is complete, transforming resources give rise to transformed resources. According to James (2011), there are 2 main types of transforming resources: * Facility which comprises of land, building, plant and equipment. * Staff which comprises of everyone involved in the operation process. There are 3 main types of transformed resources:

* Material. Transformation can be physical (manufacturing), by location (transportation), by storage (warehousing), or by ownership (retail). * Information. Transformation can be by property (accountant’s information), by possession (market research), by storage (libraries) or by location (telecommunication). * Customer. Transformation can either be physical (plastic surgery), by storage (hotel accommodation), by location (airline transport), by physiological state (hospital), or by psychological state (entertainment). Input

Output
Input that will be transformed
* Material
* Information
* Customer
Input that will transform
* People
* Facility
* Goods
* Services
Transformation
Input
Output
Input that will be transformed
* Material
* Information
* Customer
Input that will transform
* People
* Facility
* Goods
* Services
Transformation

Figure 1: The ‘Input-Transformation-Output’ process

2 Operations Strategy

2.1 Definition
Strategy is defined by Johnson et al, (2008) as ‘the direction and scope of an organization over the long term: ideally, which matches its resources to its changing environment and in particular its markets, customers or clients so as to meet stakeholder expectations.’

3.2 Levels of Strategy
Strategy can be viewed from 3 levels which are:
The Corporate level: This level looks at the long term position of the company. It answers questions like ‘where will the organization be in 10 years? Or are we going to launch a new product in a new market?’ The Business level: This level looks at the market...
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