What is Operations Management?

From the time of its origin, the operations management has a great relevance to the factory situation where the goods are produced in physical sense.

A factory can be summarized as the place where persons work with the aim of manufacturing, altering and repairing. Other important factors which are included are giving final touches, cleaning, eliminating, and also adopting changes that are required for the sale of any article.

Although the above given definition fails to properly explain the scope of operations function, it can be explained in a much better way as follows:

“Operation is the process involving the production of goods and services”.

This explanation of production covers different varieties of sectors of economy which may include energetic surveys, transport service, warehousing etc.

One of the important factors in operations function is to bring people together at one place with machines and materials, which will result in the production of goods and services.

The term operation covers manufacturing and also the very important service organizations.

In either of these categories or organizations, operations deals with a group of purposeful activities of the organization. Very often, operations function is referred to as the backbone of an organization and indeed this is very much true as observed in the various organizations. An operation is defined as conversion of inputs into outputs, resulting in the much needed addition of value to some entity.

The addition to the value corresponding to an entity can be done by following a large number of ways which may include alteration, transportation, storage and inspection.

As mentioned earlier that production involves the conversion of inputs into output, so it forms a very essential part of the conversion process.
Inputs include raw materials, energy, production, schedules, parts, information technology, consumables and output includes goods which are produced, transported goods, customers who had been offered services ,delivering messages and also very importantly: ‘cured patients’.

One factor which is very important and requires considerable attention is the effectiveness of operation managements. The effectiveness in operation management, in general terms, refers to the efficiency involved during inputs conversion into outputs. The gauging of conversion efficiency is generally done by working out the ratio of the output to the input. In management language, it is referred to as productivity of the system.

More is the value of the productivity of the production system, more will be the efficiency involved in the production function. The managing body of the production system is in close contact with the managing body of the productivity. The concept of productivity is like a coin with two faces which can be viewed in different ways. One way of understanding this concept of productivity is to observe waste quantities produced in the system. Waste is the output which is not required, that is, it is unnecessary. The generation of waste means that the efficiency of the production system can be improved. This can be done by eliminating, or also to some extent, by minimizing the quantities of the waste creeping into the system.