Operations Management - Essay Example

OPERATIONS MANAGEMENT ID No: Introduction According to Nigel, Chambers and Johnston (2010, p. 1), all organization; be it small or large produce some services and product either for profit or not for profit. Consequently all these organizations require operations management which is concerned with creating products and services. Nigel, Chambers and Johnston (2010, p. 1) assert that most organizations have realized the great potential of operations management to improve the efficiency and customer service. Operations management is not confined to the operations department only since all managers manage processes and serves customers, makes part of their activities operations. This paper will explore the definition of operations management and discuss the key responsibilities of an operations manager. In addition, given that planning and control is an integral component of operations since it helps ensure that an organization offers products and services that can satisfy the customer’s demands; I will describe the key planning and control tasks involved in operations. I will use examples of some manufacturing and service to build the discussion. 2.1: Operations Management Operations management is defined by Metters and Maruacheck (2007, p. 210) as the conversion of inputs into outputs, using physical resources in order to provide the desired utility of place, form, state or possession or a combination to the customer while still fulfilling the other organizational goals of efficiency, effectiveness and adaptability. Pilkington, and Meredith (2009, p. 190) further explain that operations management is basically concerned with conversion of inputs using physical resources. Nigel, Chambers and Johnston (2010, p. 3) defined operations management as a process of planning, organizing, controlling and directing the activities of the production function. Pilkington, and Meredith (2009, p. 190) argued that operations management is different from other functions of management such as personnel and marketing. He argued that there are several situations that marketing, personnel or other functions can be classified as operations. He holds that when other managers are involved in the physical distribution of products and services to customers, collection of marketing information or are involved in actual recruitment process qualifies them to be classified under operations management. The exclusion of marketing, human resource and other organization functions from the being classified as operations management is disputed by (Introduction to Operations Management) who offers a definition of operations. “Introduction to Operations Management” describes that operation is defined from a view of its mission in the organization, the technology it employs and the managerial and human processes involved. He therefore explains that operations in an organization can either be classified as manufacturing operations or services operations. While manufacturing operations yields a tangible product, a service operation leads to an intangible output. Operations management therefore involves activities geared towards production of goods and services. Therefore a more inclusive definition of operations management may be the one that describes it as all the activities of planning, organizing, controlling and directing the various resources of an organization towards the production of various products and services. The activities and responsibilities of an operations manager may be studied by analyzing the activities of such managers in a manufacturing company. In a computer manufacturing company such as HP and Compaq; the operations manager will plan on the number, type and specifications of computers produced. The manager will evaluate the market trends and forecast the number of computers to produce. In addition, the operations manager will be involved in bringing together the various resources of including human resource and the raw materials required for the manufacturing of the computers. The manager will exercise control over the computers produced to ensure they are of the desired quality and meet the international standards. Further the operations manager will coordinate the activities within the organization to ensure that the company achieves efficiency. 2.2: Responsibilities and Activities of Operation Managers Opsman (2011) describes that operation managers are engaged in planning, organizing and controlling activities. In planning; operation managers define the objectives of the operations department and sets out the policies and procedures for achieving these objectives. The manager is also involved in facility designing and product planning. Operation managers are also involved in organizing activities. Ireland (2008) explains that these are the activities that establish a structure of authority and tasks. They define the structure of how roles are shared out. Furthermore, operations managers are involved in activities that ensure that the actual performance is in accordance with the planned performance. They therefore control costs, quality and schedules in the organization. Nigel, Chambers and Johnston (2010, p. 113) argue that the responsibilities of operations managers may be divided into; direct responsibilities, indirect responsibilities and broad responsibilities. Direct responsibilities refer to activities directly charged with delivering products and services to the customers. Indirect responsibilities on the other hand refer to those duties of interfacing with other parts of an organization. Nigel, Chambers and Johnston (2010, p. 115) on the other hand describes the broad responsibilities of an operations manager as a wider ranging set of tasks that involve scanning the social, business and political environment within which the organization operates. Additionally, Nigel, Chambers and Johnston (2010, p. 114) reports that operations managers spend most of their time consulting and communicating with the internal staff, customers, suppliers and the community at large. According to Opsman (2011), the responsibilities of operations managers include logistics management. He explains that operations managers must ensure that the machinery and equipment are in good working conditions to produce the goods desired by customers. Operations managers prepare the reports of the current logistics and decide on the next course of action. Moreover, Opsman (2011) explains that operations managers have the responsibility of budget management. He observes that these managers coordinate the finance department to obtain required finances to procure equipments and supplies and they ensure that they meet the quality standards. Operations managers are also involved in operations strategizing where they play a critical role in developing an operational policy within an organization. An operations manager may for instance formulate a strategy on optimizing the use of resources within an organization. In addition, Opsman (2011) avers that operations managers have the responsibility of managing the support services. Operations managers are tasked with the duty of maximizing the output from the diverse support services like the IT, HR and finance. Operations managers have the responsibility of managing third party relations. 3.1: Application of Planning and Controlling Techniques To understand the role of planning and control in operations management I have chosen to case studies of Britvic; a soft drink manufacturing company in Europe and Concept Design Services which provides Design Company as observed from Nigel, Chambers and Johnston (2010, p. 27). For instance, Britvic distributes over a billion liters of ready to drink soft drinks in over 400 different flavors and sizes. On the other hand the service company; Design Concept Services develops products jointly with specialist design houses having a well known brand. To effectively maintain the desired level of production and efficiency the two companies must employ planning and control of the operations. Chase, Aquilano, and Jacob (2001) explain that after an organization has come up with the decision on the product design, production systems and processes; the next step is usually implementing of planning and control. Rama Rao (2009) describes that planning and controlling involves planning of routing, dispatching inspection, scheduling and coordination. It also consists of controlling of the materials, methods, operations time, and machines and tools used in the manufacturing process. The objective of planning and controlling activities is to organize the supply and movement of materials and labor, equipment and machinery utilization to achieve the desired manufacturing outputs in terms of quantity, quality, place and time. Larsen (2008, p.527) explains that while planning initiates the process, control provides adjustment to the production process. Operations control regulates and stimulates an orderly way in which materials are used in the production process from the beginning to the end. There are various techniques that operations managers can use in planning and controlling. One of these techniques is budgeting. (Rama Rao, 2009) defines a budget as a quantitative expression of the management’s plans for the forthcoming period. In an organization, there are various types of budgets with the overall organizational budget being referred to as a master budget. Larson, and Halldorsson (2004, p. 17) point that operations managers can prepare an operating budget which shows the company’s planned sales and operation expenses. He further asserts that when budgeting is done properly, it can serve the purpose of planning and controlling. After they are prepared, budgets are used throughout the year and performance reports are produced monthly. According to Kouvelis, Chambers, and Wang (2006, p. 454), the operations managers can control the operations through examining the performance reports and taking corrective measures to rectify deviations from the planned operations. Britvic Company may for instance in calculate the efficiency of company, Nigel, Chambers and Johnston (2010, p. 306) explains that the operations manager can calculate the efficiency from actual output divided by the effective capacity. The effective capacity refers to the total output that an organization can produce when working with at total efficiency. Planning is the process of forecasting every step of the operations in an organization. Planning aims at ensuring that each step is taken at the right time, place and that each operation is carried out in the maximum efficiency. In planning for the routing, Rama Rao, (2009) explains that the operations, their flow and path is predetermined. Consequently, the required machines and personnel are worked out. This step determines the cheapest flow of activities to accomplish the tasks. The next step in planning is scheduling which means calculating the time required in performing every operation and the total time required to carry out the routed operations. The various techniques applied in scheduling include preparation of a master schedule which outlines the periodic production requirement for every product. A master schedule is followed by the preparation of an operator’s schedule which describes the total time required to do a given task with a given machine. The operations managers may also prepare a manufacturing schedule for single products or where few products are manufactured continuously on a regular interval. The next procedure in planning involves determining who does which activities. Evans (2010) observes that Gantt Charts are mostly used for small industries. This evaluates what is supposed to be done and how fast the job can be done. The technique makes a comparison of what has been done and what ought to be done to come up with an estimate. Organizations fail due to failure to meet delivery schedules which is a determined by the ability to produce quality goods in time. To avoid this, organizations need to employ control in their production process. Operations manager can employ numerous techniques to ensure control in the production process. One of these techniques is follow up which is done to determine the progress of the operations, ensuring the operations are in line with the plans and removing of any bottlenecks to the production process. Evans (2010) further explains that operations managers may carry out inspection to ensure the production of quality goods. In controlling, operations managers may propose the implementation of corrective measures which will help ensure efficiency and production of quality products. The corrective actions that could be proposed include adjusting the route, periodic repairs and maintenance of machinery and equipments and rescheduling of the work. Moreover, corrective actions may involve control over the inventories causing deviations and poor performance. Offering training, transfers and demotion have also been proposed as some control measures that could be taken. Conclusion Operations management is a critical component of any organization. It is charged with various activities and responsibilities. Operations management carries out planning, controlling and coordinating all the processes in production. Some of the responsibilities of operations managers include logistics management, budget management and operational strategizing. These managers are also involved in managing the support services and the relations with third parties outside the organization. To discharge their responsibilities well operation managers use various techniques in planning and controlling the production process. Budgeting is a major tool used in planning and controlling the activities of organizations. In planning, these managers may prepare a master schedule, operator schedule or a manufacturing schedule. On the other hand the techniques employed in production control include inspections, follow ups and implementation of corrective measures.\\ References Chase. R.B., Aquilano, N.J., & Jacob F.B. 2001, ‘Operations Management for a Competitive Advantage’. Ninth Edition, McGraw-Hill Irwin Evans, J., 2010 ‘Don’t We Have People For That?’’: Operational planning &Strategy Execution. Accessed on 27th January, 2012 http://www.methodframeworks.com/article/%E2%80%9Cdon%E2%80%99t-we-have-people-that%E2%80%9D-operational-planning-strategy-execution/index.html ‘Introduction to Operations Management’, Chapter 1, viewed January 2, 2011 http://www.newagepublishers.com/samplechapter/001233.pdf Ireland, R., 2008, ‘The Migration to Retail S&OP’ Business Excellence Magazine Larsen, K. M., 2008, ‘Attributions of Conduct in Peace Operations: The ‘Ultimate Authority and Control’ Test’. The European Joutrnal of Internal Law Vol. 19 No 3 p. 509-523 Larson, P.D. and Halldorsson, A. 2004, ‘Logistics versus supply chain management: an international survey’. International Journal of Logistics: Research & Application, Vol. 7, Issue 1, 17-31. Kouvelis, P., Chambers, C., and Wang, H. 2006, ‘Supply Chain Management Research and Production and Operations Management: Review, Trends, and Opportunities. In: Production and Operations’. Management, Vol. 15, No. 3, pp. 449–469. Metters, R., and Maruacheck, A. 2007, ‘Service Management-Academic Issues and Scholarly Reflections from Operations Management Researchers’. Decision Sciences Vol 38, Issue 2, Pp: 195-214. Nigel, S., Chambers, S., and Johnston, R. 2010, ‘Operations Management’ 6th edition. Pearson Education Limited. Pp: 1-315 Opsman, 2011, ‘Operations Manager Job description: daily tasks, roles, duties and responsibilities’. Operationsmanager.com accessed 27th January, 2012< http://www.operationsmanager.com/operations-manager-roles-in-the-company/jobs-roles-duties-and-responsibilities/> Pilkington, A. and Meredith, J. 2009 “The Evolution of the Intellectual Structure of Operations Management—1980-2006: A Citation/Co-Citation Analysis,” Journal of Operations Management, Vol. 27, No. 3, pp.185-202 Rama Rao, V. S, 2009, ‘operational planning and control decisions’ accessed 27th January, 2012 http://www.citeman.com/5031-operational-planning-and-control-decisions.html Read More