The basics of operations management

Almost every business entity needs to respond to the changes in the business environment to remain competitive. A commitment in developing strategies that will respond to the changing needs of customers and the major changes in its external environment. The call for an effective operations management is a must.

Considered as the backbone of any business, operations management is the prime implementer of strategies developed by the top executives. Taking its role in the strategic business planning by improving its core operational competencies that can be an advantage because rival companies will have difficulty copying.

The three major competitive strategies that most commonly used in operations management are cost leadership, differentiation and market focus. Cost leadership's main concern is the development and production of products and services at low cost; Differentiation is the ability of the company to distinguish its product and services from competitors; and market focus emphasizes concentration on the delivery of goods and services to respond to a specific market segment. These corporate strategies were integrated within operations management for the purpose of attaining the organization's set goals.

Operations management is directly involved in quality management as well as with the design and development of products and services by understanding the needs of customers, identifying the level of customer satisfaction and using this derived information in the improvement of its products and services. It focuses on utilizing the available technology to respond as to what the customer wants and increasing productivity.

It is also concern in performance measurement and human resource management wherein it is involved in the development of employees by offering skill education and training, provides motivation and recognition, and promotes teamwork. It also encourages continuous learning not only from among co-employees and customers but also even competitors.

A need to see the "big picture" across hierarchical organizational and functional boundaries is required in operations management because it is concerned with the overall management of resources, the distribution of goods and services to customers. It views the whole business as a total system where activities are coordinated both horizontally and vertically throughout the organization ensuring that business operations are efficient and effective.

Operations management is very broad in nature that it almost covers all major aspects of a business. Its other scope includes forecasting and capacity planning, location and distribution, technology automation, process design and facility layout, materials and inventory management, production planning and scheduling, operations scheduling and project management.