Operations Management: Definition, Principles Objectives, Importance and Functions

Here you will information about operations management concept, principles of operations management, operations management objectives, importance of operations management, operations management functions, and operations management and other branches. 

To achieve business success it is vital to manage the activities that take place. And this is possible through the Operations management.

If you want to know a little more about what this branch of management is about, today I will describe its general aspects.

And also, you will know how it differs from other branches of management.

Operations Management Concept

Operations Management (ADO) is becoming increasingly important to business success.

It is the discipline that is in charge of managing all the operations that give value to the product or service that is going to be offered.

Operations Management goes beyond production. This will guide the activities of the entire company, to add value and help decision-making, using qualitative and quantitative tools.

The ADO can be applied to any area of ​​the organization, such as marketing, human resources, production, and logistics.

This discipline will ensure that the activities carried out in the company lead to the achievement of the objectives defined in its strategic planning.

The Operations management once again plays a vital role in controlling the destinations of the companies, by managing the areas of production, logistics and process improvement, which seek to satisfy the different corporate objectives

Principles of Operations Management

Below, I describe the ten principles of operations management defined by Randall Schaeffer:

Reality :

The ADO is oriented to provide an effective solution to a problem and is not focused on tools or techniques. This is because several techniques can be applied to solve the same problem.

Organization :

The processes of the company are connected to each other, because the organization is an open system. Each of the areas must fulfill its functions so that the objectives can be met.

Fundamentals:

The functions, procedures, policies, regulations are essential for the success of the company.

Accountability :

This principle indicates that the results must be measured through the application of management metrics or indicators. In this way, collaborators are also evaluated.

Deviation :

This principle indicates that operations may vary, as a result of creative processes, technology implementation, among others.

Causation :

The problems that arise in the organization must be solved from the roots, that is, the cause must be addressed.

Passion management :

Human resources must be motivated for the proper performance of their functions, since this is the engine of the company’s growth.

Humility

Operations Management is based on continuous improvement, that is, activities can be carried out better and better.

Management must be based on recognizing deficiencies or opportunities for improvement, in order to make decisions in favor of achieving quality.

Success :

This principle indicates that the concept of success in an organization is changing. To the extent that there are differences in objectives, there will also be differences in what is known as success in the company.

Change :

The organization is an open system, therefore, the only sure thing is change.

There will always be a better way of doing things, new technologies to apply, systems to improve.

Operations Management Objectives

ADO helps optimize the company’s production process.

ADO is a discipline that applies to all areas that add value to the organization. I emphasize this, because many apply it only to the production area, which is a very reductionist vision.

In this sense, the objectives of the Operations management will be oriented to achieve optimum performance in all areas of the company.

Below I describe them to you:

• Improve communication between the different departments of the organization.
• Optimize the production process of the company.
• Achieve greater quality and reliability of the product or service offered.
• Effectively manage the inventories of the company.
• Implement continuous improvements to the entire organizational system.
• Manage the resources available to carry out the activities of the company.

Importance of Operations management

Many conceive of Operations Management as a discipline very limited to the production area. If this is so, what happens after the sale of the product or service does not matter.

Operations are activities and these are carried out in all areas of the company. Can you imagine a failure in human resources, finances or in any other area? This would affect the performance of the entire organization.

The importance of the ADO is that it helps decision-making to improve the operations of the entire company. These decisions can be strategic, tactical or control.

On the other hand, this discipline is in charge of analyzing the processes individually, until activities are directed towards achieving the proposed objectives.

Operations Management Functions

Operations management performs the following functions

• Ensure the development of the company’s operations. For this it is necessary that the administrator is aware of the resources that the organization has.
• Promote communication between the different departments of the organization
• Design strategies that help the development of the product or service in the organization. For this, attention is paid to the process, from product design to after-sales service.
• Manage human resources, paying more attention to job design, training and motivation.
• Define the capacity of the facilities, according to the strategic planning of the company.
• Define the functions and times associated with human resources for the development of activities.
• Determine the resources necessary to carry out the activities, as well as their quantity and cost.
• Manage the flow of materials within the company.
• Ensure that quality is maintained in each of the activities carried out.

Operations management and other branches

ADO is a very broad discipline. It is a branch of the management, which involves other areas such as production, logistics, supplies and quality.

In this sense, the Operations management cannot be viewed from a reductionist perspective. In other words, it is not only in charge of the production of goods as the production management does.

In this sense, the ADO involves all those areas that add value to the product or service.

On the other hand, project management focuses its efforts on getting a specific job and the ADO focuses on continuous activities.

Conclusion on Operation Management

The ADO is the discipline in charge of all the activities that add value to the product or service, through planning, organization, control and direction.

To improve production systems, operations management promotes communication with the rest of the organization’s areas.

The ADO has a close relationship with project management and production management, however, it is characterized by being much broader.

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• Difference Between Public and Private Administration
• Importance of Family Business and Its Characteristics
• When to Make the Business Plan of A Company?

Thanks for reading this article on Operations Management.