Operations management is about efficiency in every operational activity in an organization. The operational activities of organizations include, purchasing of inputs, raw materials, and capital goods, hiring of labor, processing of the goods and final distribution to customers.
Operations management is involved in all the above processes in different ways but with one mission, ensuring efficiency. The scope of operations management is thus very wide. From the point of starting an organization or firm, to its days of glory, operations management is involved.
During the purchasing of raw materials and capital goods, operations professionals ensure efficiency and cost minimization by comparing prices and quality from different suppliers before signing of a supply contract. When allocating resources, operations management professionals consider several factors such as importance of the project to be funded, its viability, whether it is in line with business objectives, the return on investment and availability of funds. This helps the organization to make wise decisions.
Operations management function in distribution services is vital. Product distribution function ensures that the product reaches the final consumer. Since the profitability of any organization depends on how much of its products are sold, distribution function becomes the backbone of every organization.
The operations management professionals help here by determining the cheapest and most convenient channel of distribution to use. Finally, the operations management’s role in quality assurance is equally helpful in determining the sales and therefore success of the organization. By initiating research aimed at improving the quality of products, operations management increases the consumption of products to the advantage of the firm.
Operations management strategy involves the development of customer needs to help in developing products that satisfy them, developing corporate strategy to help in positioning the firm, operations strategy to help reduce cost while ensuring the production of goods of high quality, and continuous market scanning to react appropriately to environmental changes.