Understanding the Role of Operations Management in Business

Operations Management is a critical component of any business, as it focuses on turning resources into quality products and services. It involves overseeing the organization's production processes to create the highest level of efficiency, helping to increase profits while reducing costs and ensuring maximum productivity.

Operations Management

(OM) is the administration of business practices to create the highest possible level of efficiency within an organization. It deals with converting materials and labor into goods and services in the most efficient way possible to maximize an organization's profits. Operations management teams strive to balance costs with revenues to achieve the highest possible net operating benefit.

Operations management is primarily concerned with planning, organization and supervision in the contexts of production, manufacturing, or service delivery. As such, it focuses on delivery, ensuring that an organization successfully converts inputs into outputs in an efficient manner. The inputs themselves could represent anything from materials, equipment and technology to human resources, such as personnel or workers. Operations management is the process that generally plans, controls and supervises manufacturing and production processes and service delivery. It is important in a business organization because it helps to effectively manage, control, and monitor goods, services, and people.

Therefore, operations managers are responsible for managing the activities that are part of the production of goods and services. Their direct responsibilities include managing the operations process, adopting design, planning, controlling, improving performance and operations strategy. Their indirect responsibilities include interacting with managers in other functional areas within the organization whose functions have an impact on operations. These areas include marketing, finance, accounting, personnel and engineering. Asset Management is also a key part of operations management.

An organization's buildings, facilities, equipment, and inventory directly participate in or support the operations function. Depending on the organization, an operations manager can be responsible for many different things. Within large and complex organizations, operations are often an important functional area, with individuals specifically designated to assume responsibility for managing all or part of the organization's operational processes. The objective of operations management applied to the financial aspect of your business is the definitive increase in profits. Operations management also often follows up with customers to ensure that products meet quality and functionality needs.

Business process management is a methodology used to analyze, improve and automate processes. Operations have somehow existed since human effort itself but have changed dramatically over time; there are three main phases: artisanal manufacturing, mass production, and the modern period. Quality experts argue that well-managed work processes must be fully documented with clearly defined control points. A major innovation in operations that made mass production possible was the system of standardized and interchangeable parts known as the “American manufacturing system” (Hounshell, 198), which was developed in the United States and extended to the United Kingdom and other countries. The processes you implement serve as the basis for the day-to-day operation of your business and define how you and your team work, communicate and manage tasks involved. Existing work processes are supposed to have many desirable properties; the goal is to eliminate unnecessary steps and errors while preserving the basic structure of the process. The end user or customer of a good or service is the external customer of an organization while users or customers of outputs from other internal microoperations are internal customers.