Operations management is the management of processes that transform inputs into goods and services that add value to the customer. It is responsible for finding suppliers who supply the right goods at reasonable prices and have the ability to deliver the product when needed. Operations management performs three main groups of activities that derive from its planning, organization, and oversight functions. All activities take into account assets, costs and human resources, and begin with a thorough analysis of processes.
The combination of understanding and coordinating the work of a company is essential to becoming a successful operations manager. Operations managers acquire, develop, and deliver goods to customers based on customer needs and company skills. Problems, as they affect all levels of operations, require the knowledge of operations management as to what options are to meet these new expectations. A typical organization has four distinct core functional areas: operations, marketing and sales, finance, and human resources.
Operations management teams try to balance costs with revenues to achieve the highest possible net operating benefit. Planning for actual employment levels can have a major impact on an organization's ability to operate effectively. When demand forecasting is done correctly, it helps a lot to improve processes, including savings in costs and delivery times. With this toolbox, managers can make more rational decisions and improve overall efficiency of operations.
Operations management was formerly called production management, and it clearly showed its origins in manufacturing. The three stages of operations management are planning, organization, and oversight. Planning involves analyzing processes and determining how best to use resources to meet customer needs. Organization involves acquiring resources such as personnel, materials, equipment, and technology in order to create goods or services. Oversight involves monitoring the process to ensure that it is running smoothly and efficiently.