1)What are the various functions of operations and how are they linked to

other parts of an organization?

Operations Management is a branch that deals with

managing operations and processes within the organisation.
Efficacious management of operations ensures successful delivery
of the project. The operation managers optimises
the operations by making judicious use of resources and capital.
They manage all the aspects related to the operations that take
place in businesses. Operation managers are not only found in a
company but also in manufacturing units. They are required to
perform various functions as a part of their job responsibilities.
Some of the key functions of an Operations Manager includes:

1. Finance
Finance plays a chief role in operations management. It is essential
to ensure that the organization’s finance has been utilized properly
to carry out major functions such as the creation of goods or
services so that the customer’s needs could be satisfied.

2. Operation
This function in operation management is mainly concerned with
planning, organising, directing and controlling all the activities of an
organisation which helps in converting the raw materials and human
efforts into valuable goods and services for satisfying customer
needs.

3. Strategy
Strategy in operation management refers to planning tactics that
could help them to optimise the resources and have a competitive
edge over others. Business strategies imply to supply chain
configuration, sales, capacity to hold money, optimum utilisation of
human resources and many more.

4. Design of the product

Incorporating innovative technologies play a crucial role in the
selling of a product. Thus it is the duty of operations manager to
ensure that the product is designed catering to the market trends
and needs of the customers. The modern-day customers are more
concerned about the quality of the product than its quantity. So,
the operation managers focus on producing top-notch quality
products.

5. Forecasting
Forecasting refers to the process of making an estimation regarding
certain events that might occur in the future. In operation
management, forecasting refers to the estimation of customer’s
demand so that production can be done accordingly. Through this,
the manager gets to know what to produce, when to produce and
how to produce in accordance with the customer’s needs.

6. Supply Chain Configuration

The main motive of Supply Chain Configuration is to ensure
effective management, monitoring and controlling of all the main
activities that are held in a firm. The supply chain configuration
starts from the supply of the raw materials and continues till the
production of the final product and then their selling to the
customers which will satisfy their needs and wants.

7. Managing the Quality

Quality management plays an imperative role in selling a product.

The operation managers allocate the task of quality management
to a team and then supervise their task. The managers identify
project defects and rectify them to ensure quality. For this, certain
systems are used that measure and maintain the quality of the
product.

These are the various duties of an operations manager. Proper

skills and know-how ensure that all these roles are fulfilled
efficaciously.
2) . Service are very different from manufacturing. Therefore, it is not
appropriate to use the same set of principles for managing operations in
manufacturing and service organizations.” Do you agree with this statement?
Give reasons in support of your argument.

There are five main differences between service and manufacturing

organizations: the tangibility of their output; production on demand or
for inventory; customer-specific production; labor-intensive or
automated operations; and the need for a physical production location.
However, in practice, service and manufacturing organizations share
many characteristics. Many manufacturers offer their own service
operations and both require skilled people to create a profitable
business.

Tangibility of Output

The key difference between service firms and manufacturers is the tangibility of
their output. The output of a service firm, such as consultancy, training or
maintenance, for example, is intangible. Manufacturers produce physical goods
that customers can see and touch.

Production on Demand

Service firms, unlike manufacturers, do not hold inventory; they create a service
when a client requires it. Manufacturers produce goods for stock, with inventory
levels aligned to forecasts of market demand. Some manufacturers maintain
minimum stock levels, relying on the accuracy of demand forecasts and their
production capacity to meet demand on a just-in-time basis. Inventory also
represents a cost for a manufacturing organization.

Customer Specific Production

Service firms do not produce a service unless a customer requires it, although they
design and develop the scope and content of services in advance of any orders.
Service firms generally produce a service tailored to customers’ needs, such as 12
hours of consultancy, plus 14 hours of design and 10 hours of installation.
Manufacturers can produce goods without a customer order or forecast of
customer demand. However, producing goods that do not meet market needs is a
poor strategy.
Labor Requirements and Automated Processes

A service firm recruits people with specific knowledge and skills in the service
disciplines that it offers. Service delivery is labor intensive and cannot be easily
automated, although knowledge management systems enable a degree of
knowledge capture and sharing. Manufacturers can automate many of their
production processes to reduce their labor requirements, although some
manufacturing organizations are labor intensive, particularly in countries where
labor costs are lot.

Physical Production Location

Service firms do not require a physical production site. The people creating and
delivering the service can be located anywhere. For example, global firms such as
consultants Deloitte use communication networks to access the most appropriate
service skills and knowledge from offices around the world.

Manufacturers must have a physical location for their production and stock holding
operations. Production does not necessarily take place on the manufacturer's own
site; it can take place at any point in the supply chain.

Differences Between Goods Production and Service Operations

While manufacturing operations focus on producing goods and storing them at a

warehouse before delivering them to customers, service-providing operations
facilitate simultaneous production and consumption of services. For example, an
automobile company makes a car and keeps it in the warehouse until a customer
comes forward to purchase it. A beauty salon needs to provide haircutting services
in the presence of the customer.

Services cannot be stored for later use. When there is a high demand for services,
service operations should engage additional human resources and modify
operational activities accordingly to manage the supply-demand equation. Due to
their nature of producing and storing finished goods, manufacturing operations
don't need to engage additional resources and modify operational activities when
there is a high demand for products.

3)An organization is currently manufacturing basic cooking utensils for

household use. Although it has been in operations for the last ten years, of late
there has been a margin squeeze due to a fall in its sales volume. The
organization is trying to decide if it should provide a wider range of product
choices to its customer in order to improve its margins. What are your
suggestions to the organization for resolving this confusion? Would your
answer have been different if they were manufactures of highend premium
cookware?

Ans)My suggestion to the organistion will be that company should take

strategic decision in operations and also to implement a strategic
formulation process.The company should should study about its
shortcomings wherin it lacks like whether it is process,product,service
or are there any errors in the formulating process.The research will
answer question as to why and how sales of our product and service
decline in the market.to tackle this we need to have a strategic decision
process.

They are

1)PRODUCT PORTFOLIO

A product portfolio is the collection of all the products or services offered

by a company, each with a different growth rate and market
share. Product portfolio analysis can provide nuanced views on a stock
type, company growth prospects, profit margin drivers, income
contributions, market leadership, and operational risk. This is
essential for investors conducting equity researc or analysts supporting
internal corporate financial planning.

2)PROCESS DESIGN

In the business world, process design is a critical element of

success. In order to create efficient and profitable operations, it
is necessary to have a process in place that can be followed
consistently. Operations management is all about ensuring that
the process runs smoothly and that goals are met. Let’s discuss
what process design is and how it applies to operations
management.

Understanding Process Design: An Overview

Process design is at the heart of operations management (OM).
It is the process of creating and improving systems that convert
inputs into outputs. Process design involves understanding how
work is done within an organisation and then designing and
implementing ways to improve it.

There are several types of process designs, but all share some
standard features. Process designs must take into account the
resources required to complete the process, the desired output
of the process, and any constraints on the process. In addition,
process designs must be flexible enough to accommodate
changes in inputs or outputs.

The objective of process design is to create a system that is

efficient and effective. Efficiency means that the process uses
as few resources as possible to produce the desired output.
Effectiveness means that the process produces the desired
output.

3)SUPPLY CHAIN

A supply chain is the network of all the individuals, organizations,

resources, activities and technology involved in the creation and
sale of a product. A supply chain encompasses everything from the
delivery of source materials from the supplier to the manufacturer
through to its eventual delivery to the end user.

4)TECHNOLOGY
The most successful companies understand that technology affects
every aspect of modern day business operations. However, it is
important to remember that technology is only effective if employees
understand how to use it.

With proper training, technology operations management can bring a

business to the next level. There are many ways that technology can
improve existing outdated business operations including-

1. Customer service- Previously, customer service relied heavily on

face-to-face interactions and phone calls. Technological advances
designated social media as a crucial part of the customer service
experience.

Online chat, email exchanges, and social media interactions are now
often the first contact points in the customer service experience. If you
do not have the capability to have full time staff members available to
reply to customers on social media or email, create an automated reply
to let your customers know how soon you will have someone reply to
their inquiries.

2. Project management- Effective business administration relies on

great project management capabilities. Technology provides a platform
for every team member involved in project management to easily reach
one another and see real time updates on how a project is progressing.

Technological advances keep task lists clear and concise so that every
team member knows what specific tasks they are responsible for and by
what deadline they should be completed. Management operations are
much less daunting when project managers can see exactly what has
been completed and what has yet to be completed.

3. Automation- Throughout a supply chain there are many places that

workers waste time on tasks that could easily be automated by
computers. Supply chain management and project management can
free up the time of full time staff members and save companies money in
labor costs. Additionally,decision making and problem solving can be
improved through technological influence.

Data entry and business analytics can not only take a lot of time, but it
can also decrease employee morale and satisfaction levels. When
employees are freed up from doing repetitive and unengaging tasks they
can focus on business innovation and expanding their client base.

Automation throughout supply chains provides a secure and centralized

record of a product, every step of the way. Not only does this simplify
quality management but it provides business innovation opportunities for
every employee involved.

5)CAPACITY
Capacity is the maximum level of output that a company can sustain to
make a product or provide a service. Planning for capacity requires
management to accept limitations on the production process.
Depending on the business type, capacity can refer to a production
process, human resources allocation, technical thresholds, or several
other related concepts.

No system can operate at full capacity for a prolonged

period; inefficiencies and delays make it impossible to reach a theoretical
level of output over the long run.

THE STATEGY FORMULATION PROCESS

Strategy formulation refers to the process of choosing the most

appropriate course of action for the realization of organizational goals
and objectives and thereby achieving the organizational vision. The
process of strategy formulation basically involves six main steps.
Though these steps do not follow a rigid chronological order, however
they are very rational and can be easily followed in this order.

1. Setting Organizations’ objectives - The key component of any

strategy statement is to set the long-term objectives of the
organization. It is known that strategy is generally a medium for
realization of organizational objectives. Objectives stress the state of
being there whereas Strategy stresses upon the process of reaching
there. Strategy includes both the fixation of objectives as well the
medium to be used to realize those objectives. Thus, strategy is a
wider term which believes in the manner of deployment of resources
so as to achieve the objectives.
While fixing the organizational objectives, it is essential that the
factors which influence the selection of objectives must be analyzed
before the selection of objectives. Once the objectives and the
factors influencing strategic decisions have been determined, it is
easy to take strategic decisions.
2. Evaluating the Organizational Environment - The next step is to
evaluate the general economic and industrial environment in which
the organization operates. This includes a review of the
organizations competitive position. It is essential to conduct a
qualitative and quantitative review of an organizations existing
product line. The purpose of such a review is to make sure that the
factors important for competitive success in the market can be
discovered so that the management can identify their own strengths
and weaknesses as well as their competitors’ strengths and
weaknesses.
 After identifying its strengths and weaknesses, an organization must
keep a track of competitors’ moves and actions so as to discover
probable opportunities of threats to its market or supply sources.
3. Setting Quantitative Targets - In this step, an organization must
practically fix the quantitative target values for some of the
organizational objectives. The idea behind this is to compare with
long term customers, so as to evaluate the contribution that might be
made by various product zones or operating departments.
4. Aiming in context with the divisional plans - In this step, the
contributions made by each department or division or product
category within the organization is identified and accordingly
strategic planning is done for each sub-unit. This requires a careful
analysis of macroeconomic trends.
5. Performance Analysis - Performance analysis includes discovering
and analyzing the gap between the planned or desired performance.
A critical evaluation of the organizations past performance, present
condition and the desired future conditions must be done by the
organization. This critical evaluation identifies the degree of gap that
persists between the actual reality and the long-term aspirations of
the organization. An attempt is made by the organization to estimate
its probable future condition if the current trends persist.
6. Choice of Strategy - This is the ultimate step in Strategy
Formulation. The best course of action is actually chosen after
considering organizational goals, organizational strengths, potential
and limitations as well as the external opportunities.

4) What are order-winning and order-qualifying attributes? Give three

examples of each in the service and manufacturing industries.
ANS)

Generally a supplier must meet set minimum requirements to be considered a

viable competitor in the marketplace.

Customer requirements may be based on price, quality, delivery, and so forth

and are called order qualifiers. For example, the price for a certain type of
product must fall within a range for the supplier to be considered. But being
considered does not mean winning the order. To win orders a supplier must
have characteristics that encourage customers to choose its products and
services over competitors’.
Those competitive characteristics, or combination of characteristics, that
persuade a company’s customers to choose its products or services are
called order winners. They provide a competitive advantage for the firm. Order
winners change over time and may well be different for different markets. For
example, fast delivery may be vital in one market but not in another.
Characteristics that are order winners today probably will not remain so,
because competition will try to copy winning characteristics, and the needs of
customers will change. It is very important that a firm understands the order
winners and order qualifiers for each of their products and in each of their
markets because they should drive the manufacturing strategy. Since it is
virtually impossible to be the best in every dimension of competition, firms
should in general strive to provide at least a minimal level of acceptance for
each of the order qualifiers but should try to be the best in the market for the
order winner(s).
One also should recognize that the order winners and qualifiers for any
product/market combination are not static. Not only will customers change
perspectives as competitors jockey for position, but the order winners and
qualifiers will often change based on the concepts of the product life cycle. The
product life cycle implies that most products go through a life cycle,
including introduction, growth, maturity, and decline. For example, in the
introduction phase, design and availability are often much more important than
price. Quality and delivery tend to have increased importance during growth,
while price and delivery are often the order winners for mature products. This
life cycle approach is complicated in that the duration of the life cycle will be
very different for different products. Although some products have life cycles
many years long, other products (certain toys or electronics, for example) can be
measured in months or even weeks.