Meaning of Operations Management
Operation management means administration of business activities for attaining higher efficiency. It is a process of planning, organising and supervising the operations of business for better productivity. Operation management aims at reducing the cost to business by avoiding any wastage of resources.
Managing each and every aspect of organisation operations efficiently is key role of operation management. It focuses on raising the profit of organisations by maintain a proper balance between cost and revenue. This process ensures that all resources like raw materials and labours are efficiently utilised by organisation for production of its goods or services.
Operation management monitors and controls the entire production system of organisations. Operation managers are responsible for fulfilling all requirements of customers by delivering them products as per their needs. They take all crucial decisions relating to production process like product and process design, production planning, inventory control, quality control, capacity etc.
All these decisions are taken by them by doing research and analysing properly the prevailing situations. They work towards strengthening and enhancing the production system to minimize the wastage and maximize the output. The whole activities of operational management revolve around the conversion of inputs into outputs that is various products that every organisation manufactures.
Operation management is quite important for successful functioning of every business in today’s time. Scope of Operation management in Business can be well understood through the points given below:
Scope of Operations Management
Operation management played an important role in increasing the productivity of business. It manages all aspects of production activities to achieve highest efficiency possible. Operation manager are responsible for designing production plan for carrying out the operations. They ensure that all inputs used by organisations are efficiently transformed into outputs that is products or services. It is crucial for all business for properly managing their day to day activities and efficient utilisation of all its resources which helps in raising productivity.
Operational management directly influences the profitability of the business. It works on reducing the cost of operations to business by reducing the wastage of resources. Operations managers monitor every production activity and take all necessary steps for maintaining efficiency in the organisation. They try to maintain an appropriate balance between cost and revenue.
Maintenance of quality of products and delivering them as per customer needs is another function played by these operation managers. It helps in attracting more and more customers which increase the overall revenue of business.
Achievement of Organisation Goals
Every organisation strives towards achievement of its desired goals. Proper management of production activities helps business to properly implement their strategic plans in their operation. Operation management ensures that all operations of business are going in desired direction.
It regularly monitors every activity and takes all corrective measures as required according to prevailing situations. Proper functioning of business as per strategic plans helps in achievement of desired goals.
Improve Customer Satisfaction
Customer satisfaction is necessary for every business to improving its relations with its customers. It helps them in retaining them for the long term. Operation management monitors the quality of products manufactured by organisations. It ensures that high-quality products are produced in accordance with the requirements of customers. When products manufactured by business completely fulfil the needs of customers, their satisfaction level will improve.
Reduce Investment Need
Operation management reduces the additional capital requirements of the business. It ensures that all capital employed in the business are efficiently used. Management of operations ensures that all production activities go uninterrupted without any shortage of capital. By increasing the efficiency and avoiding the wastage of employed resources, it avoids any deficiency of capital in business. Businesses are not required to invest more in their production activities.
Maintaining proper goodwill in the market is the goal of every business. Operation management focuses on improving the position of the organisation in the market. It ensures that business works for providing better services to its customers. Business should manufacture durable and high-quality products that may provide better satisfaction to users. Customers will gain confidence in their products which will improve their market image.
Operation management helps in implementing innovative changes in organisational activities. All decision regarding production planning is taken by operation managers by doing research and analysis of prevailing market situations. It takes into account all technological changes and builds a strong base of knowledge and operations. This helps in bringing various innovations in operations of the business.