OPERATIONS

MANAGEMENT
INTRODUCTION TO
OPERATIONS MANAGEMENT
 Why Study Operations Management?
 OPERATIONS
 OPERATIONS MANAGEMENT AND PRODUCTION MANAGEMENT
 OPERATION MANAGEMENT
 CHARACTERISTICS OF OPERATIONS MANAGEMENT
 COMPONENTS OF OPERATIONS MANAGEMENT
WHY STUDY OM?
 OM is one of three major functions (marketing, finance, and operations) of any organization.
 We want (and need) to know how goods and services are produced .
 We want to understand what operations managers do?
 Costly part of an organisation.
OPERATIONS MANAGEMENT AND PRODUCTION MANAGEMENT

 Earlier the word "manufacturing" was used synonymously with the word "production", but
nowadays, we use the term "manufacturing" to refer to the process of producing only tangible
goods whereas the word "production" (or operation) is used to refer to the process of creating
both goods (which are tangibles) as well as services (which are intangibles).
 Operations Management’ is an extension of production management.
 Operations management is a wider term used in place of production management.
 The term has emerged through a progressive series of names such as manufacturing
management and production management, all of which describe the same general discipline.
INTRODUCTION TO
OPERATIONS MANAGEMENT
 OPERATIONS?

Comes from the latin word ‘opus’, meaning work.

Process of working.
Operations-refers to a function or system that transforms inputs into outputs of greater value.
Operations are often defined as a transformation or conversion process wherein inputs such as
materials, machines, labour and capital are transformed into outputs (goods and services)
DEFINITION OF OPERATIONS
MANAGEMENT
 Operations management is a systematic approach to addressing issues in the transformation
process that converts inputs into useful, revenue-generating outputs.
 operations management is a systematic approach.

It involves understanding the nature of issues and problems to be studied; establishing

measures of performance; collecting relevant data; using scientific tools, techniques, and
solution methodologies for analysis; and developing effective as well as efficient solutions to the
problem at hand.
 Operations management involves addressing various issues that an organization faces.

These issues vary markedly in terms of the time frame, the nature of the problem, and the
commitment of the required resources. Simple problems include deciding how to re-route jobs
when a machine breaks down on a shop floor.On the other hand, decisions such as where to
locate the plant, what capacity to build in the system, and what types of products and services to
offer to the customers require greater commitment of resources and time.
 Transformation processes are central to operations systems.

The transformation process ensures that inputs are converted into useful outputs. Therefore, the
focus of operations management is to address the design, planning, and operational control of
the transformation process.
 The goal of operations management is to ensure that the organization is able to keep costs to a
minimum and obtain revenue in excess of costs through careful planning and control of
operations.
OPERATIONS MANAGEMENT
 Operations management (OM) is the set of activities that creates value in the form of goods
and services by transforming inputs into outputs.
 The business function responsible for planning , coordinating , and controlling the resources
needed to produce a company’s products and services .
 Operations Management deals with all the processes and activities involved with designing,
producing and delivering a product and/ or services.
 The part of business organisation that is responsible for producing goods or services.
 operations management—a discipline that focuses on activities that relate to the planning and
control of operations in manufacturing and service organizations.
OPERATIONS MANAGEMENT
STEPS
 CHARACTERISTICS OF
OPERATIONS MANAGEMENT
 Basic business function (producing the quality product or service) to satisfy the customer .
 Responsibility to produce and deliver on time .
 Real value addition function.
 Changing physical properties to provide competitive edge .
 Decision-making is a core function .
 Use of management models to manage the operations.
COMPONENTS OF
OPERATIONS MANAGEMENT
 Product development

It is the process of designing, creating, and marketing a service or product. The product can
either be new to the market or new to the producing company or and improved when some
changes are made.
 Process design and management

It is the selection of input,resources,workflows and methods that transform input into output.
Supply Chain
It is a chain to organizations, activities, technology, people, information and resources involved
in supplying a product or service from the producer to the end-user. The complete supply chain
activities to the end customer.
SIGNIFICANCE OF
PRODUCTION AND
OPERATIONS MANAGEMENT
IN BUSINESS
 Operations management is line functional area of business, which accounts for more than 70
per cent of deployment of manpower and investments.
 Operations management function supports corporate strategy.
 It exchanges the critical information about product, process, quality, supply chain,time of
purchase of raw materials etc

 Fulfilling and satisfying the needs of the customer.