What do you understand by Operations Management?

What do you understand by Operations Management?


Operations Management has been a driving force in the improvement of business practice around the world. Operations Management lead the ways for the organizations to achieve its goals with minimum effort.

Moreover, the study and application of management techniques in managing the affairs of the organization have also changed its nature over the period of time.  Therefore, managing a service system has become a major issue in the global competitive environment.

Operations management is recognized as an important factor in country’s economic growth. Operations management is the crucial area in the functioning of organizations and therefore, and in-depth study of the subject matter becomes essential.

Operations management is concerned with the transformation of inputs the required the output of services.

We know that Management is the continuous process, which combine and transforms various resources used in the operations system of the organization into value added services.

Operations Management is the set of interrelated management activities, which are involved in manufacturing of certain products of services.

Indian industry faces some serious problems and some challenging opportunities, which we need to understand.

Some dramatic changes are taking place in the Indian economy. Planning commission of India was an institution in the Government of India, which formulated India’s Five-Year Plans, among other functions.

In his first Independence Day speech in 2014, Prime Minister Narendra Modi announced his intention to dissolve the Planning Commission. It has since been replaced by a new institution named NITI Aayog which announced that Indian economy growth target at 8% per year for the tenth Five Year Plan Period.

It was assured that a certain level of investment would give a certain amount of growth, based on AK models, which assured that output is a product of capital K and a constant positive level of technology A.

The NITI Aayog is being on high productivity to push growth to 8%. It is expected that the overall growth of industrial and service sector will grow.

Due to globalization in reforms. It is expected that small-Scale industries manufacturing will grow to global sales. The problems faced are labour laws, ending Small-Scale reservations and custom duty cuts, which can be overcome by the government with suitable time table and policies.

Definitions of Operations Management

Operations management may be defined as the design, operations and improvement of the production system that create the firm’s primary product and services. Operations Management concerns itself with the conversion of inputs into outputs, using physical resources, so as to provide the derived utilities, places possession or state or a combination of these to the customer while meeting the other organizational objectives of effectiveness, and adaptability.

Historical evolution of Production and Operations Management

For over two centuries operations and production management has recognized as an important factor in country’s economic growth.

The traditional view of manufacturing management began in 18th Century when Adam Smith recognized the economic benefits of specialization of labour.

He recommended breaking of jobs down into sub task and recognizes worker to specialized task in which they would become highly skilled and efficient.

In the early twentieth century, FW Taylor implemented Smith’s theories and developed scientific management. From then till 1930, many techniques were developed prevailing the traditional view.

Operations Management

Operation Mangers are concerned with planning, organizing and controlling the activities which affect human behavior through models.

1. Planning

Activities that establishes a course of action and guide future decision making is planning. The operations managers defines the objectives for the operations subsystem of the organizations, and the policies and procedures for achieving the objectives. This stage includes clarifying the role and focus of operations in the organization’s  overall strategy. It also involves product planning, facility designing and using the conversion process.

2. Organizing

Activities that establishes a structure of tasks and authority Operation Managers establish a structure of roles and the flow of information within the operations subsystem. They determine the activities required to achieve the goals and assign authority and responsibility for carrying them out.

3. Controlling

Activities that assure the actual performance in accordance with planned performance, To ensure that the plans for the operations subsystems are accomplished, the operations manager must exercise control by measuring actual output and comparing them to planned operations management. Controlling costs, quality, and schedules are the important functions here.

4. Behavior

Operation Managers are concerned with how their efforts to plan, organize and control affect human behaviour. They also want to know how the behaviour of subordinates can affect management’s planning, organizing, and controlling actions, their interest lies in decision making behaviour.

5. Models

As operation managers plan, organised, and control the conversion process, , They can simplify their difficulties using models like aggregate planning models for examining how best to use existing capacity in short-term, break even analysis to identify break even volumes, liner programming and computer simulation for capacity utilization, decision tree analysis for long term capacity problems facility expansion, simple median model for determining best locations of facilities etc.

Hence, Operation Management is a broad concept we will study about in our further post so keep touch with us.

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