Reading 11 Introduction to operations management
1 What is operations management?
The three main types of transformation processes
Transformational change
2 What do operations managers do?
Key responsibilities
Efficient delivery of goods and services through effective use of the organisation's resources.
Consolidated balance sheet ⚖️
Meeting customers needs
Fixed assets
Manufacturing plants and equipment 🪴⌨️
Additional assets
Raw materials
Work-in-progress 🏗️
Unsold finished goods (Closing inventory) 📦
All tie up the invested CAPITAL
Interest payments in exchange for services 💷
Over-stocking creates cash flow problems
Failure
Avoidance strategies (efficiency methods)
- Process design
- Effective planning
- Control systems
Dependent on devoted workforce. ✊✊✊
Continuous improvements
Input >
Process
Output >
Management input resources:
Managing processes
Managing outputs
Facilities 🪜
Equipment ⌨️
Staff 🧑💼
Customers 🛒
Suppliers 💳
Transport 🚌
Materials 👕
Energy ⚡
Process flow ➡️
Work-in-progress 🏗️
Process design 🎨🖼️
Planning and scheduling 📌
System improvement 🖥️
Information ℹ️
Products and services 🛍️
Customer satisfaction 😃😡
Unit costs (profitability) 🪙
Environmental impacts 🌿
Fixed assets
Material processing
Information processing
Customer processing
Manufacturing operations ⚙️
Mining operations ⛏️
Logistics operations
Shipping 📤📥
Trucking 🚛
Warehousing 🏭
Postal services 📬
Retail operations 👚
Banking 💰
Accounting 🧾
News services 📰
Telecommunications 📞
Research 📚
Intangible 💻
Tangible ✍️
Average customers would contempt to being 'processed'. ❌
Hotels 🏨
Hairdressers ✂️
Hospital 🏥
Theme Park 🎢
Benefits applied to "tangible" organisations like these who execute 'customer processing operations'. ✅
Physical transformation (Resources)
Information transformation
Possession transformation
Preparation of food in restaurant kitchen
A machining of metal in an engineering workshop
The mixing of chemicals in a laboratory
Transforming data embedded in company reports or research projects
Via simpler data processing
Booking information for customers
Retail operations 👚
Change in processing goods ⚙️
Data sharing
Conveyancing & buying property 🏠
Location transformation
Logistics processes
Transport services
Storage transformation
Inventory stored within warehouses 📦
People stored in waiting rooms 🧑🦲🪑
Data stored on servers 🖥️
Serves purpose of availability of resource and system utilisation
Physiological or phycological transformation
Medicine 🏥
Surgery 😷
Counselling 🫂
Mental health 🧠
Hairdresser 💈
New hairstyle 💇
Hotel 🏨
Pleasure☺️/Dining🍽️/Swimming 🏊♂️
Theme park 🎡
Scary ride 🎢
Transformation of bravery achieved 🛡️
Organising the input resources
Managing the outputs
Managing processes
The design of processess
Planning and control
Improvement
Short-term v long-term perspectives of operations management
Simplicity v complexity
3 The importance of operations management
Positive impacts
Reducing costs through efficient operations
Enhance revenues by providing more marketable goods and services through quality, service and innovation
Minimising capital required to establish viable operation
Developing capabilities and competences to allow markets to serve with more efficiency