Unit 1: Overview of Operations Management
Operations management is a vast topic but can be bundled into a few distinct categories, each of which will be covered in later units. (It should be noted, however, that entire courses could be devoted to each of these topics individually.) Because most people do not work in a formal operations department, we will begin with an overview of operations management. The top manager of an operations department is usually called the Director of Operations. Most operations departments will report to a Chief Operating Officer (COO), who reports to the Chief Executive Officer (CEO). The COO is often considered the most important figure in a firm, next to the CEO.
The history of operations management can be traced back to the industrial revolution when production shifted from small, local companies to large-scale production firms. One of the most significant contributions to operations management came in the early 20th century when Henry Ford pioneered the assembly line manufacturing process. This process drastically improved productivity and made automobiles affordable to the masses. Understanding the motivations behind innovations of the past can help us identify factors that may motivate individuals in the future of operations management.
Completing this unit should take you approximately 4 hours.
Upon successful completion of this unit, you will be able to:
- define operations and operations management;
- differentiate between manufacturing and service operations;
- describe the role of an operations manager within an organization;
- relate operations to the other functional areas of a business organization; and
- identify and apply the elements of the transformation model to the relationship between the inputs, processes, and outputs of an organization.
- define operations and operations management;
1.1: Introduction to Operations Management
Read this chapter for a brief introduction to operations management and how to think about it. Be sure to answer the discussion questions in Activities 1 through 3.
Operations management is the management of the processes that transforms inputs into the goods and services that add value for the customer. After you read this page, you should be able to explain the role of operations management within an organization and differentiate between strategy and tactics.
Service and manufacturing operations share many similarities. However, there are some important differences. This section provides an overview of those differences.
1.2: Manufacturing versus Service Operations
This section discusses the role of an operations manager in a manufacturing company. After reading the section, take time to think about and answer the two exercises.
This section talks about how the elements of operations management for service providers differ from manufacturing operations management. Complete the exercise provided at the end of this section. As you do it, consider how each element is important to the successful operations of a service business.
1.3: The Systems View of Operations Management
Simply put, operations management is the process of transforming inputs into outputs. This article gives you a foundation for understanding an underlying model that supports this process. This is important because the types of inputs are discussed, and there are opportunities for you to consider how different types of organizations combine inputs to create unique products and services. Be sure to complete each activity.
Operations management does not exist in a vacuum within an organization. Operations management is a functional area that interacts with and is supported by other functional parts of the organization. This section discusses the suppliers and customers as areas outside the organization's control. Be sure to complete each activity.
This section covers the functional structure that is common in many organizations. Operations is a function within the organization. It is important to understand the other functional units and how operations fit within the overall structure.
1.4: The Process View of Organizations
- Read this page and explore the transformation process that occurs in operations management. Operations management transforms inputs like labor, widgets, steel, and capital into outputs (goods and services) that provide added value to customers. After you read, you will be able to analyze the importance of operations management in protecting an organization’s competitive advantage.
Unit 1 Activity and Assessment
- Make forum posts: 1
After you've spent some time reviewing what you have learned so far in this unit, post about this topic on the discussion forum. Respond to your classmates' posts, as well.
Choose a company that creates a product or offers a service that you are familiar with. Using the company website and additional research, list the inputs that the company uses to produce outputs. Define the outputs created. After creating this list, discuss the additional functional units within the organization that are important to the final product. How important do you believe the quality of the operations management is to the final output? Explain your answer.
For this activity, you will apply the concepts of operations management to real world situations. You will use this unit to begin developing an operation management plan by writing a 2–3 page paper on a business concept of your choosing.
- Receive a grade
Take this assessment to see how well you understood this unit.
- This assessment does not count towards your grade. It is just for practice!
- You will see the correct answers when you submit your answers. Use this to help you study for the final exam!
- You can take this assessment as many times as you want, whenever you want.