Introduction to Industrial Management and Engineering
TU-22.1101
Operations Management
1. Definition
Operations management focuses on carefully managing the processes to produce and
distribute products and services. Usually, small businesses don't talk about "operations
management", but they carry out the activities that management schools typically associate
with the phrase "operations management." Major, overall activities often include product
creation, development, production and distribution. These activities are also associated with
Product and Service Management.
However product management is usually in regard to one or more closely related
product -- that is, a product line. Operations management is in regard to all operations within
the organization. Related activities include managing purchases, inventory control, quality
control, storage, logistics and evaluations. A great deal of focus is on efficiency and
effectiveness of processes. Therefore, operations management often includes substantial
measurement and analysis of internal processes. Ultimately, the nature of how operations
management is carried out in an organization depends very much on the nature of products or
services in the organization, for example, retail, manufacturing, wholesale, etc. [1]
The importance of operations management has increased dramatically in recent years.
Significant foreign competition, shorter product and service life-cycles, better-educated and
quality-conscious consumers, and the capabilities of new technology have placed increasing
pressures on the operations function to improve productivity while providing a broader array
of high-quality products and services. With the globalization of markets, firms are
recognizing that the operations function can be used as a competitive weapon to strengthen
their position in the market place. Managers in operations management play a strategic, as
well as a tactical role in satisfying customer needs and making their firms strong international
competitors.
2. Origin
The origins of Operations Management can be traced back to the Industrial
Revolution, the same as Scientific Management and Operations Research. Adam Smith treats
the topic of the division of labour when opening his 1776 book: An Inquiry into the Nature
and Causes of the Wealth of Nations also commonly known as The Wealth of Nations. The
first documented effort to solve operation management issues comes from Eli Whitney back
in 1798, leading to the birth of the American System of Manufacturers (ASM) by the mid1800s. It was not until the late 1950's that the scholars noted the importance of viewing
production operations as systems. [2]
Historically, the body of knowledge stemming from industrial engineering formed the
basis of the first Master of Business Administration (MBA) programs, and is central to
operations management as used across diverse business sectors, industry, consulting and nonprofit organizations.
3. Operations Management skill
Operations managers skill allow knowledge and possibly career in service
organizations involved in activities such as banking, transportation, insurance, and
government, as well as manufacturing firms involved in producing industrial and consumer
products. Operations management titles often used are vice president of manufacturing, vice
president of operations, vice president of quality, plant manager, purchasing manager,
department supervisor, computer systems analyst, operations analyst, inventory control
supervisor, facilities planner, scheduler, first-line supervisor, and buyer. [3]
4. Useful links
As the operations management takes a more and more important place in the
international business, some organizations have been created. The following organizations
support and promote operations management: [4]
-
APICS The Association for Operations Management (http://www.apics.org/)
The Association for Professionals in Business Management (APBM)
(https://www.apbm.org/)
Chartered Management Institute (http://www.managers.org.uk/)
European Operations Management Association (EurOMA) (http://www.euromaonline.org)
-
Institute for Operations Research and the Management Sciences (INFORMS)
(http://www.informs.org/)
Production and Operations Management Society (POMS) (http://www.poms.org/)
5. References
[1]: Operations Management
Assembled by Carter McNamara, MBA, PhD
[2]: An historical perspective on Operations Management, James M. WIlson, (1995)
Production and Inventory Management Journal
[3]: Fisher College of Business – The Ohio State University
http://www-afa.adm.ohio-state.edu/u-majors/pdf/opermgt.pdf
[4]: Wikipedia – The Free Encyclopaedia
http://en.wikipedia.org/wiki/Operations_management#cite_note-3