‘Discuss the role and importance of operations management in the context of the organization that you have chosen.’ 2010 Cohert
What is Operations Management?
• “Operations management is the activity of managing the resources which are devoted to the production and delivery of products and services”. It is one of the core functions of any business, although it may not be called operations management in some industries.
• Operations management is con concerned with managing processes. And all processes have internal customers and suppliers. But all management functions also have processes. Therefore, operations management has relevance for all managers.
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How do operations processes have different characteristics?
• Operations differ in terms of the volume of their outputs, the variety of outputs, the variation in demand of their outputs, and the degree of ‘visibility’ they have.
• High volume, low variety, low variation and low customer ‘visibility’ are usually associated with low cost. (Where does Walmart fit in this model?)
What are the activities of operations management?
• Responsibilities include understanding relevant performance objectives, setting an operations strategy, the design of the operation (products, services and processes), planning abd controlling the operation and the improvement of the operation over time.
• Operations managers also have a set of broad societal responsibilities. These are generally called ‘corporate social responsibility’ or CSR objectives.
You may wish to position the company’s operations using the Polar Diagram below. Note that speed, cost, dependability, flexibility and quality dimensions are in context of competitors and for operations.
Then a high-level diagnosis of operations performance can be conducted by the polar diagram shown below:
A useful way of representing the relative importance of performance objectives for a product or service is shown in the polar diagram above. This is called the polar representation because the scales which represent the importance of each performance objective have the same origin. The closer the line to the common origin, the less important is the performance objective to the operation.
2. What are the Company’s operations strength?
Operational strengths relate to processes that occur behind the scenes. In the case of Walmart for instance having a more efficient warehouse operation, that’s an operational strength, in mass marketing retailing, Wal-Mart claims numerous operational strengths. By requiring all manufacturers to comply with Wal-,Mart can run a much more efficient warehouse and distribution operation than it’s competitors – who must contend with a hodge-podge of labeling and packaging standards from their various suppliers . If you sell your products to Wal-Mart, you use their labeling and bar-coding systems, and you pack your boxes according to the quantities that Wal-Mart dictates. The result is a distinct operational strength for the Wal-Mart operation, which translates into lower stocking and handling costs, and shorter restocking times for warehouse to store shelves.
Quality is placed first in our list of performance objectives because many authorities believe it to be the most important. Certainly more has been written about it than almost any other operations performance objective over the last twenty years. Later in the book we devote two whole chapters (Chapter 17 and Chapter 20) which look at different aspects of quality. As far as this introduction to the topic is concerned, quality is discussed largely in terms of it meaning ‘conformance’. That is,...