OPERATIONS MANAGEMENT

Operations management is the “design, operation, and improvement of the systems that create and deliver
the firm’s primary products and services” (Chase & Jacobs, 2006, p. 9). It is an area of management
concerned with designing and controlling the process of production and redesigning business operations
of goods or services. It involves the responsibility of ensuring that business operations are efficient in
terms of using as few resources as needed and effective in terms of meeting customer requirements.
Operation management is primarily concerned with planning, organizing and supervising in the contexts
of production, manufacturing or the provision of services.

Operations management role is divided into three areas:

 Managing input resources –

Operations managers must ensure that the
right resources, such as people, equipment
and materials, are available in the right
quantity at the right time for the operation’s
needs.
 Managing processes – All operations
managers are responsible for processes.
Processes are defined as a series of
interlinked activities or steps that consume
resources to meet a goal or output.
 Managing outputs – The operations
function is responsible for meeting
customers’ needs by delivering required
products or services. The effectiveness and efficiency of the operation dictates how much resource is
needed and this feeds straight through to unit cost and (where relevant) profitability.
SIX COMPONENTS OF OPERATIONS MANAGEMENT

1. Performance Management 

It is the systematic process by which an organization involves its employees, as individuals and members
of a group, in improving organizational effectiveness in the accomplishment of mission and
goals. Employee performance management includes, planning work and setting expectations, continually
monitoring performance, developing the capacity to perform, periodically rating performance in a
summary fashion, and rewarding a good performance.

2. Metrics and Reporting

Performance Measures explains how well product, services and processes are working together to
keep customers satisfied. It also includes the study of processes within a company to see if  output is in
line with objective. Most of the performance measured based on effectiveness, quality, efficiency,
productivity, safety, and timeliness.

Performance Reporting is the process of collecting raw data, deciphering the coherence between
the goals and process and creating and distributing performance information to stakeholders. In a
performance report clarification should be done alongside the information provided on scope, cost,
schedule quality and procurement, as well as data on work performance, units of performance
measurement, completed forecast, measures for quality control, project management plan, requested
changes approval and produced actions.

3. Professional Development

It refers to all training, certification and education that a worker needs to succeed in his or her career. It's
no secret that different jobs require different skills. Even if a worker currently has the necessary skills, he
or she may need additional skills in the future. Through professional development, workers can learn
these skills to become better, more efficient workers.

4. Quality Monitoring and Analyzing 

It refers to the assessment of the performance of the quality management systems. This component
revolves around Total Quality Management, Total Quality Circles, ISO 9001 and Six Sigma.

5. Productivity Monitoring and Control 

It is a measurement or calculation between inputs and outputs. Inputs include raw materials, machinery
and labor; outputs are the goods or services produced. The more stable and elaborated the process of
production is, the smoother level of productivity is expected from employees operating it. Guideline for
monitoring employee productivity includes measuring, comparison, identification, feedback.

6. Continuous Movement Initiatives 

Involves 5S Process which is a structured program to systematically achieved total organization,

cleanliness, and standardization in the workplace. 

• Seiri (Sort) – Eliminate whatever is not needed by separating needed tools, parts, and
instructions from unneeded materials. 

• Seiton (Set in order) – Organize whatever remains by neatly arranging and identifying parts and
tools for ease of use. 

• Seiso (Shine) – Clean the work area by conducting a cleanup campaign. 

• Seiketzu (Standardize) – Schedule regular cleaning and maintenance by conducting seiri, seiton,
and seiso daily. 

• Shitsuke (Sustain) – Make 5S a way of life by forming the habit of always following the first
four S’s. Benefits of the 5S Process includes: improves safety, decrease downtime, raise
employee morale, identify problems more quickly, and develop control through visibility.
Reference:
Barcial, A. et.al. (2018). ‘Fundamentals of Business Process 101 Written Report’. Retrieved from
https://drive.google.com/drive/folders/10TTBKH1Tcn8dNBz2Q3Fsgge3QAo7jq4v

Walley, P. (2017) ‘Introduction to Operations Management’, in The Open University (2017) B207
Readings Block 1: Big ideas in Organisations, Milton Keynes, The Open University.
Retrieved from https://www.open.edu/openlearn/money-business/business-strategy-
studies/introduction-operations-management/content-section-1

Jung, D. (2016). ‘Operations Management Study Material Note’. Retrieved from

https://www.studocu.com/en/u/1818260

(n.d). ‘The Roles of Operations Management’. PowerPoint Presentation from University of

Technology, Sydney. Retrieved from https://www.coursehero.com/file/45154356/51-The-
Role-of-Operations-Managementpptx/?justUnlocked=1#/doc/qa

Elzey, S. (2012). ‘Role of Operations Management Paper’. University of Phoenix ISCOM/471.

Retrieved from https://www.coursehero.com/file/21803401/Role-of-Operations-
Management-Paper/#/doc/qa