Monday, December 6, 2010

Operations Management

Core Fundamentals of Operations Management 

This article will discuss the basics of operations management as it pertains to business.

What is operations? 

The part of a business organization that is responsible for producing goods or services. Operations, in a sense, is business.

How can we define operations management? 

The management of systems or processes, including financial matters, that create goods and/or provide services.

At the core of operations management is the supply chain.

Supply Chain 

The supply chain is a sequence of activities and organizations involved in producing and delivering a good or service.

For a better idea of how a supply chain works take a look at the list of typical supply chain components or parties below.

Supply Chain Hierarchy

  • Supplier for suppliers 
  • Direct suppliers
  • Producer
  • Distributor
  • Final customers 

The management of the supply chain may be the most important aspect of operations management.

The other function of operations management that rivals supply chain management in importance is the overall planning and purpose of the company.

This must be planned and constantly reviewed and revised as needed.

Hierarchical Planning Process

  •  Mission
  • Goals 
  • Organizational Strategies 
  • Tactics 
  • Functional Strategies 

I have posted an article worth reading if you are interested in learning more about operations planning for organizational strategy