The essence of the operations function is to add value during the transformation process. The greater the value added the greater the amount of funds available for the organization to improve its goods or service, invest in its facilities and equipment, paying employees and profit.
The extremely competitive nature of the global business environment requires companies to produce high quality goods and services in the most efficient way possible. Few defects, fast production, low costs, excellent customer service, broad market reach, innovative products and processes, less waste and high flexibility are all objectives that add value to the goods or services being produced. Companies pursue these objectives to maintain a competitive advantage. Moreover, managers understand that the level of efficiency that a company aspires to in the production of goods or services affects its long term ability to address the needs of its customers.
Operations Management is one of the basic functions of the organization. It is concerned with managing the systems or processes that creates goods or services. It also involves the configuration of resources combined for the provision of goods or services in the form of manufacture, transport, supply or service and the creation of goods or services involving transforming or converting inputs into outputs.
The following areas are covered in the Operations Management pillar:
- System Design (capacity planning, process selection, facility layout, design of work systems and location planning and analysis).
- Quality Management
- Internal Quality Control Management.
- Third Party Quality Control Management.
- Supplier Qualification and Evaluation.
- Supply Chain (Customer Service, Transport Decisions, Inventory, Location, Organizing and Control, Planning, Resource Leveling).
- Project Management
- Lean – 6 Sigma – NPD – Assets.
- Cost Saving.
- Capacity Increase.
- New Technology.
- Energy Saving Initiatives.