Functions of Operations Management

In the past, manufacturing companies had a challenging time improving the efficiency of their production facilities. As the companies grew, this task became even more challenging due to a lack of visibility within their production operations and a lack of collaboration throughout the departments. 

As the challenges grew, some people found that focusing on the ‘operations’ component of the business organization made a real impact on the productivity of the manufacturing facility. After this, operations management became a viable solution to help manufacturing facilities increase their efficiency and profits.

What is Operations Management?

In a manufacturing organization, the ‘operations’ component is responsible for the transformation of raw materials into finished goods. Operations management can then be defined by the management of all processes related to the production of items.

Within the process, operations management makes use of various tools and strategies to increase production output and ensure that customer orders are completed on time.

The field of operations management is vast and complex, but it has some key functions that are important to understand for anyone wanting to implement such strategies into their manufacturing facility.

Key Functions within Operations Management

Some of the key functions of operations management include:

• Finance - In any manufacturing organization, finance plays a crucial role in ensuring that financial resources are properly allocated and utilized to their full extent. Finance in operations management helps create a budget that will allow the organization to meet its production goals and can help evaluate various investment opportunities to make the best decision. Proper utilization and allocation of finances will allow for a product to be created for the lowest cost that will also satisfy overall consumer needs.
• Strategy - Strategic management is the planning, monitoring, analysis, and assessment of tall aspects of an organization on a continuing basis. Attention to these elements ensures that a strategy is developed and then implemented in the manufacturing facility. The benefits of strategic management will help manufacturing organizations make better decisions regarding production planning and scheduling, keep customers happy and allow the facility to meet its overall goals. Many business strategies include supply chain configuration, sales, capacity to hold money, and optimal utilization of human resources.
• Operation - This function of operations management is concerned with planning, organizing, directing, and overall control of all activities within the organization. This is the primary function of operations management and will effectively aid in converting raw materials and human efforts into a durable good and service that consumers will be able to utilize. Operations within production must be scheduled in a way that minimizes the amount of setup required and maximizes the utilization of resource capacity. If this is achieved, the production facility will be able to increase its production output.
• Product Design - With new technology becoming available, the selling of a product becomes much more simple. One of the main duties of operations management is to ensure that a product is designed properly and caters to market trends and satisfies the needs of consumers. In addition, introducing new product designs can be challenging due to the existing product mix and available resources. Those are important factors to consider when looking to introduce new items.
• Forecasting - Demand forecasting is the process of predicting what the demand for certain products will be in the future. It identifies what both current and future customers will want to buy and tells manufacturing facilities what they should actually produce. Ideally, manufacturing companies want to be able to accurately predict customer demands so that they can produce the right amount of products. Producing too few items leads to stock shortages and can negatively impact customer relationships. On the other hand, having too much inventory is costly and can lead to having excess stock if the items become obsolete. Finding the right balance is one of the functions of operations management.
• Quality Control - In addition to the product design function, operations managers should strive to produce the best quality product possible. Modern-day consumers are concerned about quality instead of quantity, which is why it is so crucial to develop a durable and top-notch quality product. This is especially important when evaluating the existing processes as improving production processes should not be at the expense of quality. Operations managers should ensure that quality control processes are defined and implemented to catch any defective items.

Managing operations can be a complicated process that requires in-depth knowledge of the related field. Fortunately, operations management uses similar management tools and techniques, no matter the industry. Additionally, an Advanced Planning and Scheduling (APS) software such as PlanetTogether APS can also help reduce the complexity that comes with operations management.

PlanetTogether frees Joyce from all the mechanics. We run more efficiently, with more money to the bottom line. From an executive point of view, that’s one result that gives me a chance to relax and enjoy another cup of coffee.

DANA KING, V.P. INFORMATION SYSTEMS, DIEDRICH COFFEE

 

As an operations manager, using tools like an advanced planning and scheduling software will help you streamline processes and improve efficiency within the production facility.

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!