Fundamentals of Operations Management: By: Raquel Graham

Fundamentals of Operations
Management
By: Raquel Graham
Elements in Business
There are 5 main elements that are involved in a business
whether manufacturing or service:
2
What is Operations Management?
Operations Management is concerned with the design,

management, and improvement of the systems that create the
organisation's goods or services.
OM concerns itself with the processes involved in converting

and transforming inputs into outputs in the form of goods or
services that add value to the organisation.
3
Components of an Operating System
Basic components:
inputs and resources (natural or material resources, human
resources, technological resources and entrepreneurial
resources) which are purchased by the organisation
processes which involve the conversion or transformation of
these resources into products or services (e.g. using project,
batch or continuous processes)
output and then feedback to the organisation from its
customers
4
Operating System
CONTROLS
INPUTS PROCESSES OUTPUTS
RESOURCES
5
Why is it Important?
Too often, attention is paid to

finance, technology and
marketing, and not the actual
functions of the business.
E.g. Marketing a new product and

it does not meet quality
expectations, poor supply to
customers etc.
E.g. Finance is not paying

suppliers or not receiving
payments from customers on time
6
Another View of Operations
Consider the human body –
Marketing – Style of dress, personal hygiene
Finance – Blood, oxygen
Administration – taking care of health, exercising, lifestyle
mgmt
Training – Education, work experience
Operations – the entire process of keeping all organs healthy,
interacting day to day, moving around i.e. everything you do!
If you don’t take care of one element, the entire body can suffer
7
Components in Operations Management
8
Decisions involved in Operations
Management….
Corporate
1. Operations Strategy
2. Make vs. Buy Decisions
3. Location
4. Production
5. Processes and Facilities to be used
Tactical
1. Workforce Management
2. Inventory Management
3. Quality Management
4. Scheduling
5. Plant Maintenance
9
Manufacturing vs. Service
Organisations
Operations Management is a crucial function of both

manufacturing and service organisations.
Manufacturing companies produces tangible products
that can be listed as inventory
Service organisations produce a non-physical output and
involves the customer in the production process
Most oganisations do both. There are few pure
manufacturing or pure service organisations.
10
Manufacturing vs. Service
Organisations
Both types of organisations face similar operational

problems:
both must obtain suitable and sufficient materials to be
used in the production process
both must determine suitable scheduling tasks
both should be concerned with both the quality of their
end products and with their productivity levels
11
What Drives Operations?
COMPETITION!!
Every organisation attempts to be successful in the market

place by obtaining an acceptable market share through
competitive strategies.
The competitive advantage adopted by the management will
be determined by the organisation's overall strategic plan and
by its strategic objectives.
Success is dependent on the organisation adopting efficient
and effective operations with respect to the manufacturing of
their products or the provision of their services
12
Some of the most commonly
overlooked elements of Operations
Inventory Management
Forecasting
Administration
Customer Relationship Management
Supplier Relationship Management
Facility Management
13
Conclusions
Operations management is often overlooked in favour of

marketing and finance
There are many ways to improve the efficiency of a
business by pay attention to how the business is run
The business structure should match closely the level of
competition in the market place
Operational audits are just as important or more so than
financial audits
It is all about the customer and the added value
14
Thank You!!!
Email: [email protected]
Cell #: 262 9379
LinkedIn: Raquel Graham

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Fundamentals of Operations

Operations Management is concerned with the design,

OM concerns itself with the processes involved in converting

INPUTS PROCESSES OUTPUTS

Too often, attention is paid to

E.g. Marketing a new product and

E.g. Finance is not paying

Operations Management is a crucial function of both

Both types of organisations face similar operational

Every organisation attempts to be successful in the market

Operations management is often overlooked in favour of

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