Operations management (OM) is the process that effectively plans, organizes, coordinates, and controls the operations responsible for the production of goods and services. Countless decisions must be made at all levels of an organization. Without proper operations management, there is a higher chance of having various departments in conflict with each other. Operations management ensures that you are able to effectively manage various attributes in the manufacturing organization such as people, equipment, information, and technology.
Within any production facility or organization, it is crucial to have adequate and advantageous operations management to ensure that production runs smoothly even when the unexpected situations arise. There are many benefits that come from implementing operations management strategies to allow you to gain insight into the key areas that are in need of improvement.
Key Benefits within Effective Operations Management
- Product Quality - The quality of a product refers to its capability of meeting or exceeding a customer’s expectations. Operations management ensures that products meet the quality standards and offers opportunities to identify areas where quality can be improved. One of the main functions of operations management ensures that products are designed to be reliable and durable to meet customer’s expectations of quality over quantity. Here, reliability and durability refer to products that last a long time before they encounter breakdowns and that can withstand damage. Enforcing a quality management process can ensure the efficient delivery of products and services that consumers can rely on.
- Customer Satisfaction - Customer satisfaction is essential for any manufacturing operation as it ensures future business from your current customers. While operations management takes care of creating products and services of high quality, it also ensures that customer needs are met. When your operations are running smoothly, it will allow you to deliver your products on time to your customers and increase their satisfaction. In addition, improving your processes may cause you to decrease your production lead times, allowing you to deliver quality products in a short amount of time. These factors will ensure that your customers buy from you again and that they value your brand over competitors.
- Revenue Increase - Increased product quality and consumer satisfaction will give your company to have a good reputation within the industry. This reputation will further aid your company to attract more customers and expand its market share. In addition, operations management involves identifying and optimizing the processes involved in the production of goods or services. This can lead to cutting costs due to inefficiencies in the process design. Overall, operations management will allow you to sell more products and reduce costs, leading to a revenue increase that enables the continuation of growth for the company.
- Waste Reduction - Waste reduction is one of the most important components of operations management. Various techniques can be used to identify and eliminate waste within manufacturing operations, such as lean manufacturing strategies and JIT scheduling to manage inventory costs. Lean manufacturing identifies 7 wastes that are commonly found in manufacturing operations which aim to eliminate overproduction, loss of time, and defective items. Eliminating waste within your operation will allow you to increase profits by eliminating unnecessary costs and ultimately improving the overall production process within the operation.
- Collaboration - Adequately implementing operations management strategies require collaboration between many individuals at all levels of the organization. Many business strategies involved in operations management include supply chain configuration, sales, capacity to hold money, and optimal utilization of human resources. All of these decisions benefit from having multiple departments involved in the decision-making process to ensure that all departments are benefiting from the decisions. For example, it is important to include people in charge of finances in the product design process as it will ensure quality materials can be chosen for a reasonable price.
We now have a consistent tool for our planning and scheduling that is used by most of the departments, from supervisors, production planners, purchasing, IT staff, and management.
BRUCE HAYS, DIRECTOR OF MANUFACTURING, J&J SYNTHES
Operations management can be challenging to implement. A software that is becoming extremely common among manufacturing operations is advanced planning and scheduling software. These softwares can provide thorough insight within the various components of the production operations. APS softwares like PlanetTogether will take your facility to the next level by helping you optimize and increase the efficiency of your operations.
Advanced Planning and Scheduling (APS) Software
Advanced Planning and Scheduling Softwares have become a must for modern-day manufacturing operations as customer demand for increased product assortment, fast delivery, and downward cost pressures become prevalent. These systems help planners save time while providing greater agility in updating ever-changing priorities, production schedules, and inventory plans. APS Systems can be quickly integrated with an ERP/MRP software to fill the gaps where these systems lack planning and scheduling flexibility, accuracy, and efficiency.
With PlanetTogether APS you can:
- Create optimized schedules that balance production efficiency and delivery performance
- Maximize throughput on bottleneck resources to increase revenue
- Synchronize supply with demand to reduce inventories
- Provide company-wide visibility to resource capacity
- Enable scenario data-driven decision making
The implementation of an Advanced Planning and Scheduling (APS) Software will take your manufacturing operations to the next level of production efficiency by taking advantage of the operational data you already possess in your ERP system. APS is a step in the right direction of efficiency and lean manufacturing production enhancement. Try out a free trial or demo!
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FAQs
Operations management is important in a business organisation because it helps effectively manage, control and supervise goods, services and people. It cuts across the sector and industry. In the health sector, operations management ensures proper health delivery with the right instruments at the right time.
Why is OM important in the organization? ›
It ensures efficient production processes, optimal resource utilization, and, ultimately, the achievement of desired business goals. Additionally, operations management involves planning, organizing, and supervising the entire production timeline, from input to output.
What is effective in operations management? ›
Effective operations management touches all aspects of essential work, including supply chain, and ensures the company is meeting key performance indicators (KPIs). Managers use operations management KPIs to make informed decisions and coordinate efforts across the supply chain and organization as a whole.
What is the importance function of operation management? ›
At its core, the main function of Operations Management is to transform inputs into outputs efficiently, ensuring that the organization achieves its goals effectively. It involves a holistic approach to overseeing processes, managing resources, and adapting to dynamic business environments.
What makes operations effective and efficient? ›
Operational efficiency is about doing things right. In other words, it means ensuring that the workflows are error-free, thus preventing delays and cost increases caused by delays and rework. Or, preventing below-specification products and services from reaching the customer.
What is the contribution of Om to strategy? ›
OM assists senior level management in making strategic level decisions. Such decisions consider the existing constraints as well as the current conditions to formulate efficient systems and companywide processes to achieve a competitive advantage.
What are the top 3 important functions of operations management? ›
The top three important functions of operations management are planning and control, quality management, and supply chain management. They optimize efficiency, quality, and customer satisfaction within an organization.
What is the most important functions of the operation manager? ›
Operations managers help ensure that the company's products and services meet quality standards. They set goals, collaborate with quality control teams, monitor quality assurance systems, and institute changes to meet evolving market conditions and customer demands.
What are the 5 basic functions of management operations? ›
Students will begin by thinking about what management means to them, and work toward building a comprehensive understanding of the specific types of responsibilities that fall under the five functions of management framework: decision-making, planning, staffing, directing and controlling.
What does Om mean in workplace? ›
Operations management (OM) is the administration of business practices to create the highest level of efficiency possible within an organization. It is concerned with converting materials and labor into goods and services as efficiently as possible to maximize the profit of an organization.
Operations management (OM) is the business function responsible for managing the process of creation of goods and services. It involves planning, organizing, coordinating, and controlling all the resources needed to produce a company's goods and services.
What are the 7 main functions of operations management? ›
We can distinguish seven main functions of operation management in the industrial enterprise: planning, scheduling, purchasing, controlling, quality control and inventory control.
Within any production facility or organization, it is crucial to have adequate and advantageous operations management to ensure that production runs smoothly even when the unexpected situations arise. There are many benefits that come from implementing operations management strategies to allow you to gain insight into the key areas that are in need of improvement.