Role/Functions of Operations Management
The role of operations management depend on the size of the firm as it decides the organizational control and decision-making powers at different levels of management.
i. In small-sized firms, all other functions such as production, marketing, finance, personnel etc. are looked after by one manager.
ii. In medium-sized firms, different functions are performed by different managers.
iii. In large-sized firms, operations management looks after production activities only.
Some of the important functions of Operations Department are:
1. Selection of material
The operations manager selects appropriate material for the product. For that purpose, research on material is necessary to find out its availability and suitability to the process, budget and thus to the product.
2. Selection of appropriate method
Selecting a suitable method of production is the most important task. The appropriate method will be selected by the operations department subject to the available resources and constraints.
3. Selection of suitable machinery and equipment
The operations department selects the suitable machinery and equipment according to the design and requirement of the process and the layout of the shop floor.
4. Fixation of production targets and delivery dates to minimize the cost
The operations department has to keep the cost to the minimum for the survival in the competitive situation. Thus, the department has to decide what should be done in maintaining the cost at the desired level.
5. Scheduling of activities
To achieve the production target, it has to be specified clearly the exact start and finish time of different activities. Accordingly, the department has to manage the timings of purchase of the materials and to plan the activities of manpower.
6. Routing and making layout of lines
Fixing the route for raw material, components and various activities from the warehouse to the production facility and then to the finished goods warehouse and fixing the layouts of various lines of production to achieve the production target are also the major functions of the operations department.
7. Dispatching
Various documents such as routing sheet, inspection cards for the components of various products are planned and prepared by the production department for starting the production. Releasing of these documents is known as dispatching.
8. Follow-up
It is necessary for all the scheduled activities. The management wants to know whether the activities are being carried out as per the plans or not. The actual work is compared with the plan and thus an analysis of the progress of the work is also done by the operations department. If there is any deviation from the target, then it should be rectified.
9. Inspection
A separate Quality Control Department does the qualify inspection of the products to find out any chances of qualifying of the defective products. But many a time, this work is also done by the operations department.
Difference Between Production and Operation Management
Operations Management is a new version of production management, which includes additional activities such as procurement of raw material, supply chain and value chain. Some of the differences are listed below:
| Production Management | Operations Management |
| Manufacturing of tangible goods, e.g. car, bike etc. | Producing both tangible and intangible output (services) e.g. banking, transportation etc. |
| Tangible products are consumed over a period of time. | Intangible services have to be consumed immediately. |
| Manufacturing of tangible products requires less labour and more equipment. | Producing the intangible services needs more labour and less equipment |
| No participation | Frequent participation while providing the services. |
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