University - Year 1

Operations Management
Notes-1

1. Define Operations Management.

Operations management is the management of systems or processes that create goods and/or provide
services. It also affects the company’s ability to compete.

2. What are the major functions of Business Organization?

Finance is responsible for securing financial resources at favorable prices and allocating those resources
throughout the organization, as well as budgeting, analyzing investment proposals, and providing funds
for operations.

Marketing and operations are the primary, or “line,” functions. Marketing is responsible for assessing
consumer wants and needs, and selling and promoting the organization’s goods or services.

Operations is responsible for producing the goods or providing the services offered by the organization.

3. Define the following: a. Value-added

b. Lead time
Value-Added is the difference between the cost of inputs and the value or price of outputs.
Lead Time is the time between ordering a good or service and receiving it.
4. Illustrate the Transformation Process.
>Inputs are used to create goods or services using one or more Transformation Processes (e.g., storing,
transporting repairing)

>Measurement and Feedback are received and used to compare previously established standards to
determine whether corrective action (Control) is needed