ADVANCED FINANCIAL ACCOUNTING 1

Running Head: RESEARCH METHODOLOGY

Advanced Financial Accounting

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Operations Management

Definition of Operations Management

According to Reid, & Sanders (2019), operations management refers to arranging, sorting

out and overseeing with regards to creation, fabricating or the arrangement of administrations. In

general, operations management focuses on promotion and ensures that the association makes a

productive contribution to revenue. The sources of information themselves could cover a variety

of topics such as materials, equipment, innovation or human resources such as personnel or

manpower.

Role of Operations Management

Operations management plays a crucial role in every organization. The success of the

organization has been based on how organizations manage their operations. Operations

management has a vital role in the strategy of an organization related to the goods or services to

be produced and how to produce like what should be the cost, what material to be used, etc. the

role of operations management also involves satisfying the customer's needs, which means that

operations management would be responsible for producing what has been demanded in the

market. it plays a crucial role in converting minimum inputs like labor, raw materials into

maximum outputs.

Importance of Operations Management

Operations management holds significant importance for any organization. The three

reasons why operations management holds great importance include:

Customer Satisfaction

The satisfaction of customers has been the key to the increase the sales of business

because it requires business, customers to whom it could sell its products. In addition to quality
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management, which focuses on product quality, operations management should also operate in a

way that the demands of customers could be met. The framework would give a procedure to use

to make an ideal buyer item.

Quality of the Products

The activities guaranteed by Quality Management would contribute to improving the

quality of the goods and services. Considering the quality of the goods, there have been two

aspects to which it refers, reliability and durability. Maintaining the quality management process

for efficient material transport and processing could guarantee product reliability on which

customers could rely.

Increase in Revenue

By improving product quality and customer satisfaction, the organization would have a

positive reputation within the market. This reputation would also help the company to attract

more customers and increase its number of sales. Overall, this would increase revenue and allow

the organization to grow further

Manufacturing/ Service Organization

Services and manufacturing organizations require a greater need for operations

management because both types of the organization’s key concern have been productivity. Thus,

to produce the goods and services efficiently with less input and less cost requires proper

operations management otherwise, the cost would exceed the price and the service and

manufacturing organizations would suffer losses.

Definition of Value Chain

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From the study of Simatupang, Piboonrungroj, & Williams (2017), A value chain

comprises of an action plan that represents all the activities planned to create a facility or

jurisdiction. In the case of organizations producing goods, the value chain includes how goods

have been transported from establishment to possession, as well as everything related to the

purchase of raw materials, capacity building, and business promotion.

Value Chain Management

As highlighted by Yamoah (2019), Value Chain Management has been a means to

monitor and manage all parts that affect production, including sourcing, creation, quality control,

and distribution.

Goals of Value Chain Management

The goals of value chain management include production and supplying the products to

the customers at low cost, to prepare the products fastly and accurately and processing in a way

that every step used to produce the goods or services would be the most effective to use.

Benefits of Value Chain Management

Legitimate Value chain management has been essential for the development of economic

activity and the growth of profits. Organizations could create incentives for themselves, their

dealers and end customers if they could develop creativity and business, from incoming to

outgoing coordination, advertising, business, and administration by effecting doing value chain

management.
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References

Reid, R. D., & Sanders, N. R. (2019). Operations management: an integrated approach. John

Wiley & Sons.
Simatupang, T. M., Piboonrungroj, P., & Williams, S. J. (2017). The emergence of value chain
thinking. International Journal of value chain management, 8(1), 40-57.
Yamoah, F. A. (2019). Sustainability in supply and value chain management. In Incorporating
Sustainability in Management Education (pp. 167-193). Palgrave Macmillan, Cham.