The Importance of Operations Management
What is Operations Management? Operations Management is a very important role in any business, company, and corporation. It creates goods and services that can be sold to make profit (Investopedia.com). There are many resources that involve the process of Operations such as employees, facilities, inventory, and time. Operations Management is important because it helps make profit if the resources are used properly. Operations Management explores the way organizations produce and distribute goods and services. It focuses on organizing a process of what they are working on or distributing.
Adding on to Operations Management, Operations Managers play a huge role in the management process. The whole Operations Management process is run by the Operations Managers. An Operations Manager manages the production of goods and services. They focus on making sure the organization is running effectively and that the goods and services they produce satisfy the clients’ needs (smallbusiness.chron.com) Operations Managers have to monitor processes and analyze if everything is working smoothly. They have to create strategies to improve the productivity and deal with employees. Most Importantly Operations Managers are responsible for critical activities such as managing materials, capacity planning, purchasing, scheduling, and mainly quality management.
Forecasting is another important role an Operations Manager has to take care of. It helps develop plans and reduce problems in the future. Managers always want to match supply with demand, in order to do that it is important for them to forecast how much space they need for supply to each demand. Elements of good forecasting includes time, accuracy, reliability, meaningful units meaning how many dollars will be needed for the production planning, the forecasting should be in writing, and last it should be simple to understand and use (http://highered.mcgraw-hill.comChapter 3). There are three approaches to forecasting. The first is Judgmental; Operation Managers rely on analysis of subjective inputs taken from a lot of sources. The second one is Time-series forecasts; it is an attempt to project the past experiences into the future. Last one is the Associative Models; which uses equations that consist of one or more explanatory variables to predict demand.
We all know strategic capacity planning is very important for an Operations Manager. Strategic planning is to reach an optimal level where production capabilities meet demand. Capacity includes equipment, space, and employee skills. Managers should recognize the bigger affects of capacity decisions have on the organization. Some common Strategies are leading capacity, where capacity is increased to meet expected demand. The Following capacity where the companies wait for the demand to increase. Two most useful functions managers can use are Design capacity and Effective capacity (http://highered.mcgraw-hill.comChapter4). Design capacity refers to the maximum designed service capacity or output rate and the Effective capacity is the design capacity minus personal and other allowances. These two functions of capacity can be used to find the efficiency and utilization
The importance of quality is a huge for managers. The quality should always meet a customers needs and expectations. Quality depends on how the customer views it. For an example what kind of quality does McDonalds have? Is it the taste or the quickness and the client gets the same burger every time. Going to Chillys and eating their meat can be better quality for someone. It all depends on the client and how the managers approach the situations. The manager should have an insight of different kids of quality. Quality is always something that meets the customers’ expectations.
Operations Management positions have a lot of responsibilities. They have to purchase materials, parts, and supplies to produce products that can be...
Cited: Wiki Spaces. “Strategy and Productivity” http://ids355.wikispaces.com/Ch.13+Aggregate+Planning, 2014
Investopedia. “ Definition of Operations Management” http://www.investopedia.com/terms/o/operations-management.asp,
Small Business, “ The role of an Operations Manager” Karen Farnen,
McGraw Hill, “ Forecasting”
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