THE SCOPE OF OPERATIONS MANAGEMENT

WHAT DOES A BUSINESS OPERATIONS MANAGER DO?

• Working on budgets for equipment and technology needed for an organization. ∙

• Analyzing current processes to help make the business as efficient as possible. ∙
• Keeping up with business trends and economic trends to forecast how the business ∙
• will need to adapt and change over time.
• Working with every department, from marketing to manufacturing, to learn about staff ∙
• and processes and help them be more productive.
• Negotiating with vendors to find the fit for the organization’s needs.∙

HOW TO BECOME A BUSINESS OPERATIONS MANAGER

Education requirements

• For most entry-level business operations positions, a business degree in business management
or accounting can be ideal.
• For larger companies and higher positions, an MBA or Master of Business Administration degree
is usually preferable.

Qualifications and skills Leadership.

• Organization.
• Decision-making.
• Data processing.
• Reporting.
• Budgets.
• Stress tolerance.

MOST OF THE ACTIVITIES PERFORMED BY MANAGEMENT AND EMPLOYEES FALL INTO THE REALM OF
OPERATIONS MANAGEMENT:

• Forecasting
• Capacity planning
• Locating facilities
• Scheduling
• Managing inventories
• Assuring quality
• Motivating and training employees in all the phases of operations∙

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FORECASTING

HERE ARE SOME EXAMPLES OF USES OF FORECASTS IN BUSINESS ORGANIZATIONS:

• Accounting – new product/process cost estimates, profit projections, cash management.

• Finance – equipment/equipment replacement needs, timing and amount of funding/ borrowing
needs.
• Human resources – hiring activities, including recruitment, interviewing, training, layoff
planning, including outplacement, counseling.
• Marketing – pricing and promotion, e-business strategies, global competition strategies.
• MIS – new/revised information system, internet services.
• Operations -schedules, capacity planning, work assignment and workload, inventory planning,
make-or buy decisions, outsourcing, project management.
• Product/service design – revision of current features, design of new products or services.∙

ELEMENTS OF A GOOD FORECAST

1. The forecast should be timely

2. The forecast should be accurate, and the degree of accuracy should be stated.

3. The forecast should be reliable, it should work consistently.

4. The forecast should be expressed in meaningful units.

5. The forecast should be in writing.

6. The forecasting technique should be simple to understand and use.

7. The forecast should be cost-effective.

CAPACITY PLANNING

Capacity is defined as the ability to achieve, store or produce. For an organization, capacity
would be the ability of a given system to produce output within the specific time period. In operations,
management capacity is referred as an amount of the input resources available to produce relative
output over period of time.

In general, terms capacity is referred as maximum production capacity, which can be attained
within a normal working schedule.

Capacity planning is essential to be determining optimum utilization of resource and plays an

important role decision-making process, for example, extension of existing operations, modification to
product lines, starting new products, etc.

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Goal of Capacity Planning

The ultimate goal of capacity planning is to meet the current and future level of the requirement
at a minimal wastage. The three types of capacity planning based on goal are lead capacity planning, lag
strategy planning and match strategy planning.

FACILITY LOCATION IN OPERATIONS MANAGEMENT

Facility location is the process of determining a geographic site for a firm’s operations.
Managers of both service and manufacturing organizations must weigh many factors when assessing the
desirability of a particular site, including proximity to customers and suppliers, labor costs, and
transportation costs.

SCHEDULING IN PRODUCTION AND OPERATION MANAGEMENT

Scheduling can be defined as “prescribing of when and where each operation necessary to
manufacture the product is to be performed.” It is also defined as “establishing of times at which to
begin and complete each event or operation comprising a procedure”.

WHY IS INVENTORY MANAGEMENT IMPORTANT?

Effective inventory management enables businesses to balance the amount of inventory they have
coming in and going out. The better a business controls its inventory, the more money it can save in
business operations.

QUALITY ASSURANCE

Includes two principles: "Fit for purpose" (the product should be suitable for the intended
purpose); and " right first time" (mistakes should be eliminated). QA includes management of the quality
of raw materials, assemblies, products and components, services related to production, and
management, production and inspection processes. The two principles also manifest before the
background of developing (engineering) a novel technical product: The task of engineering is to make it
work once, while the task of quality assurance is to make it work all the time.

MOTIVATION AND MOTIVATING PEOPLE

Effective managers have the ability to motivate those they work with to behave in a specific,
goal directed way. Motivation is defined as energizing, directing and sustaining employee efforts.

A motivated team should be energized and excited about performing tasks. They should be
focused on doing what is important for the organization. Managers want a sustained effort from their
employees so that they work hard whether or not the boss is present.

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 With an effective motivational scheme in place, managers are much more likely to retain the
most talented workers and dissuade them from leaving and going to a competitor.

OPERATIONS MANAGEMENT

• Increase Productivity
• Raises Revenue
• Achievement of Organization Goals
• Improve Customer Satisfaction
• Reduce Investment Need
• Enhance Goodwill
• Improve Innovation