The goal of operations management is maximize efficiency while producing goods and services
that effieciently fulfill customer needs.
If the organization has made mostly good operating decisions
in designing and executing its transformation system to meet the needs of
The Role of Operations Management in the
Operations is one of the three functions of strategy of any
organization. This means that it is a vital part of accomplishing the
organization’s strategy and ensuring its long-term survival. The other two
areas are marketing and finance.
Strategic Versus Tactical Operations Decisions
Operations decisions include decisions that are strategic in
nature, meaning that they have long-term consequences and often involve a great
deal of expense and resource commitments.
For example, United Parcel Service (UPS), an international
package delivery service, formed a partnership with its customer, Toshiba
computers. Toshiba needs to provide a repair service to its laptop computer
customers. The old approach of providing this service was cumbersome and
The traditional approach, the total time to get a laptop
computer repaired was two weeks—a long time for people to be without their
laptop! Then they came up with an innovative idea for Toshiba to provide better
service to its customers.
UPS hired, trained, and certified its own employees to
repair Toshiba laptop computers. The new repair process is much more efficient:
UPS picks up computers from Toshiba owners.
UPS repairs the computers.
Services cannot be touched, shipped, handled, or looked at.
Inventory – Services
cannot be stored for later use. They occur, or they do not occur.
Services cannot be pulled into different parts or separated
Services tend to be unique. A teacher may teach you a topic, and another
teacher may teach you the same topic in another course.
Consumers are often directly involved in the service delivery. A therapist is a
good example of thisManaging Service Operations
Managing operations is
just as critical on the service side as it is on the product side. While there
are countless considerations to be made, many of which are unique to specific
organizations or industries, these core operational decisions are strong
indications of the mentality service management specialists consider:
Choosing where to open
a facility, how to lay out the facility, what size is appropriate, and overall
how efficiently a given space can be used relative to the cost are key
considerations. Consider a car mechanic opening a garage.
Just as a product
manufacturing facility will know when a product will be where, so too do
service operators need to know when a given service should start and what
duration of time is required to complete it.Maximizing output through planning
properly can minimize opportunity costs and maximize revenue, and plays an
integral role in operational management of services. Take a doctor’s office.
managers are integral to organizational strategy in many companies and
organizations. The Bureau of Labor Statistics (BLS) reports that over 1.7
million operations and general managers were employed throughout the United
States in 2010 in various industries..
management professionals are responsible for collaborating with other managers
and executives to determine how operational planning can contribute to the
long-term strategy of the organization.
ensure that planning is carried out, operations management professionals are
also responsible for providing direction to various managers under their watch.
Operations managers ensure that all departments are completing their necessary
function within the organization by meeting productivity goals and budgetary
Operations managers also help in the achievement
of organizational strategy goals by coordinating the activities between various
departments within their companies. They improve efficiency and focus by
facilitating and improving relations between departments, especially those that
often operate independently of one another.
The operations manager is also integral to the
continued strategy and vision of a company in his role as a resource manager.
Operational managers must be able to assess the resources of the organization,
whether they be monetary or otherwise, and ensure that the resources are used
as efficiently as possible
Quality Management Systems
The regulated companies that fail to embed an
automated, effective QMS solution into their manufacturing and value chain
operations expose their brands to increased compliance risks, and thus weaken
their competitive standings in the market. But automating your quality
processes, such as document control, training, corrective action, and risk
management, into one easy-to-use, easy-to-access effective quality management
system can give your regulated organization the competitive edge it needs to
achieve compliance success, and win the race to market.
You’ll save time
You’ll accelerate compliance
You’ll deliver safer, higher quality products
to your customers
Management Systems: Build vs. Buy
advantages of automating your quality processes into an effective QMS are
compelling. Any company that wants to stay competitive and compliant needs an
automated effective quality management system. But should you build your own
homegrown system or buy a proven, validated QMS? Building a homegrown QMS has
its advantages, but it also presents unique challenges and raises important
Effective Quality Management System
is a leading provider of effective quality management systems to regulated
companies worldwide. Unlike other effective QMS solutions, MasterControl been
designed to integrate with other enterprise systems quickly and easily.
Furthermore, MasterControl allows you to create a unified method for
streamlining and managing all of your critical quality processes such as
document control, risk management, audit, training control, quality event
management (complaints, MDR, NCMR, CAPA, deviations, nonconformances), as well
as BOM management, project management, and change control (ECR,ECO). Few other
effective quality management systems offer such one-stop-shopping.
is also web-based, so users can access the system from virtually anywhere in
the world, at any time. Users can also access the system using a tablet or a
Participation is very important to improve the quality of the work In the
organisation. Managers need to encourage workers to take responsibility for the
quality they provide, and meets the customer’s expectations.
It is a
philosophy of management, which addresses the means of raising the quality
performance to unprecedented levels. It involves the participation from whole
organisation and demands to be implemented in all aspects of the business
Canadian market is very competitive, the new improved processes and systems
will also create a good image for the organization
improvement technique will also help them to get customer satisfaction on a
higer level. They will be able to address their customers’ needs in a more
efficient and effective way. With this they can rebuild customer relation and
help maintain business
Quality Management Principles:
It is a
management approach which involves the data, data and effective communication
to integrate quality principles and management into the organisation.
first principle of TQM is to be customer focused. Whatever done for the quality
improvement, is to gain customer satisfaction. If
principle is that managers need to ensure that they have employees on board
involves the complete focus of the management centred towards the process
thinking, so that two key principles can be achieved:
the first step to improve quality is to prevent errors. It is better to train
staff and avoid accidents rather than finding ways out of it
aim should be to provide a service with zero defects, that means no comprise at
all. The mortar should be prepared by missing the correct ratio of cement and
Next step is
to sort the organizational structure according to the action plan and strategy.
It is very important that managers must align the strategy with organizational
structure. They manage the question “Is the organization’s current
structure appropriate to the intended strategy?”
Change Management has evolved over the past several years
with Change Management , Processes, plans and models developed to help ease the
impact change can have on organizations environment.
Change Management Models have been developed
based on research and experience on how to best manage change within an
organization or in your personal life. Most Change Management Models provide a
supporting process that can apply to your organization and personal
These Processes include a sequence of steps or
activities that move a change from inception to delivery.
They are developed to support a project to deliver a change. It
is typically created during the planning stage of a Change Management Process.
8 Essential Steps
for an Effective Change Management
1. Identify What Will Be Improved
Since most change occurs to improve a process, a product, or an outcome, it is
critical to identify the focus and to clarify goals. This also involves
identifying the resources and individuals that will facilitate the process and
lead the endeavor
2. Present a Solid Business
Case to Stakeholders
There are several layers of stakeholders that include upper management who both
direct and finance the endeavor, champions of the process, and those who are
directly charged with instituting the new normal.
3 .Plan for the Change
This is the “roadmap” that identifies the beginning, the route to be
taken, and the destination. You will also integrate resources to be leveraged,
the scope or objective, and costs into the plan. A critical element of planning
is providing a multi-step process rather than sudden, unplanned “sweeping”
4. Provide Resources and Use
Data for Evaluation
As part of the planning process, resource identification and funding are
crucial elements. These can include infrastructure, equipment, and software
systems. Also consider the tools needed for re-education, retraining, and
rethinking priorities and practices. Many models identify data gathering and
analysis as an underutilized element. The clarity of clear reporting on
progress allows for better communication, proper and timely distribution of
incentives, and measuring successes and milestones.
This is the “golden thread” that runs through the entire practice of
change management. Identifying, planning, onboarding, and executing a good
change management plan is dependent on good communication. There are
psychological and sociological realities inherent in group cultures. Those
already involved have established skill sets, knowledge, and experiences
6. Monitor and Manage
Resistance, Dependencies, and Anticipating and preparing for resistance
by arming leadership with tools to manage it will aid in a smooth change
7. Celebrate Success
Recognizing milestone achievements is an essential part of any project. When
managing a change through its lifecycle, it’s important to recognize the
success of teams and individuals involved. This will help in the adoption of
both your change management process as well as adoption of the change itself.
8. Review, Revise and
As much as change is difficult and even painful, it is also an ongoing process.
Even change management strategies are commonly adjusted throughout a project.
Like communication, this should be woven through all steps to identify and
Throughout most of modern
business history, organisations have attempted to unlock value by matching
their structures to their strategies. As mass production took hold in the eighteenth
century, for instance, companies generated enormous economies of scale by
centralizing key functions like , sales, operations and finance. A few centuries
later, as firms diversified offerings and moved into new regions, a rival model
emerged. Corporations such as General Motors and DuPont created business units
structured around products and geographic markets. The smaller business units
sacrificed some economies of scale but were more flexible and adaptable to
adopted a matrix arrangement in the belief that they could retain both the
economies of scale of centralized functions and the flexibility of their
product-line and geographic business units. But matrix organizations were
difficult to coordinateThe continual search for new organizational forms is
driven by basic changes in the nature of competition and the economy
Corporate synergies can
also be generated by leveraging relationships across multiple business units to
offer common customers lower prices, greater convenience, or solutions more
complete than specialized competitors can provide. For example, Media General
implemented an effective convergence strategy by sharing editorial processes
and advertising content among its regional television stations, newspapers, and
interactive online media properties. This cross-unit integration created a
unique value proposition for the common customers—advertisers and
subscribers—that was better than any single property could offer on its own.
Customer synergies also arise when retail companies like hotel chains, consumer
banks, or quick-service restaurants consistently deliver the same value
proposition across a geographically dispersed network of retail outlets. Hilton
Hotels and McDonald’s are good examples here.
Toyota Company focused on
its inventory management and quality improvements in its products and
processes. This operational excellence is based in part on tools and quality
improvement methods made famous by Toyota in the manufacturing world such as continuous
improvement, one-piece flow, Automation: automation with human intelligence)
and production smoothing). These techniques have helped in spawning down the
“Lean Manufacturing” revolution
With the implementation of
Lean system, Toyota has been achieved a significant mile stone in terms of
improving the quality of its output and reducing the cost of the products through
elimination of waste. There are four goals of Lean manufacturing systems. One
of the major goals is to improve quality where as the Elimination of waste, To
stay competitive in today’s marketplace, a company must understand its
customers’ wants and needs and design processes to meet their expectations and
requirements. As such Toyota has been able to win their customers by providing
quality output at a reasonable price and it has become the leader in the
automobile industry at present.
The fundamentals needed in developing a strategic quality
plan are usually same for all organizations.
Vision – Begins with a customer focussed vision. More broadly
vision aims at the satisfaction of all the stakeholders. Vision should state
the desired future state of the organisation to everyone involved and compel
and share throughout the organisation.
Mission that clarifies the
purpose for organisation’s existence will provide an agreed- upon direction to
the entire organisation and can be used as a basis for decision-making.
Customer satisfaction, loyalty and retention
Costs involve in poor quality products/processes.
Culture of the organisation
Business processes and improvements
Competitive and industry benchmarking
Strategy evaluation is the final step of strategy
management process. The key strategy evaluation activities are: appraising
internal and external factors that are the root of present strategies,
measuring performance, and taking remedial / corrective actions. Evaluation makes
sure that the organizational strategy as well as it’s implementation meets the
organizational objectives. Strategic Evaluation is defined as the process of
determining the effectiveness of a given
strategy in achieving the organizational objectives and taking corrective
action wherever required.
In the absence of such a mechanism, there would be no means
for strategists to find out whether or not the strategy is producing the desired
effect.q There has to be a way of finding
out whether the strategy being implemented will guide the organisation towards
its intended objectives. Strategic evaluation and control, therefore, performs
the crucial task of keeping the organisation on the right track.q During the strategic management
process, the strategists formulate the strategy to achieve a set of objectives
and then implement the strategy.q Nature of
the strategic evaluation and control process is to test the effectiveness of
strategy.qNature of Strategic Evaluation
The process of strategic evaluation
provides a considerable amount of information and experience to strategists
that can be useful in new strategic planning. Strategic evaluation, through its
process of control, feedback ,rewards, and review, helps in a successful
culmination of the strategic management process. Strategic evaluation can help
to assess whether the decisions match the intended strategy requirements.Importance
of Strategic Evaluation
Middle-level manager Corporate Planning Staff or Department? Audit and Executive CommitteesExternal
and Internal Auditors? Company secretaries? Financial controllers? Profit-centre heads? Chief executives? Board of Directors? Shareholders?Participants in Strategic Evaluation
Quantitative criteria includes determination of net profit,
ROI, earning per share, cost of production, rate of employee turnover etc.
Among the Qualitative factors are subjective evaluation of factors such as –
skills and competencies, risk taking potential, flexibility etc
. The two basis types of
implementation control are: a. Monitoring strategic thrusts (new or key
strategic programs): Two approaches are useful in enacting implementation
controls focused on monitoring strategic thrusts: (1) one way is to agree early
in the planning process on which thrusts are critical factors in the success of
the strategy or of that thrust; (2) the second approach is to use stop/go
assessments linked to a series of meaningful thresholds (time, costs, research
and development, success, etc.) associated with particular thrusts. b.
Milestone Reviews: Milestones are significant points in the development of a
programme , such as points where large commitments of resources must be made. A
milestone review usually involves a full-scale assessment of the strategy and
the advisability of continuing or refocusing the direction of the company