Operations manaegement in a firm is based accross all departments and consists of converting resources from inputs to outputs. For example, an online travel agent creating holiday packages for customers. The input is all the airfares, hotels, and tours. The output is the itinerary with the final price for the package.
2. Explain operations management’s role in business
Operation managers control the flow of inputs and outputs in an organisation. Their role consists of:
Forecasting: knowing when particular services need to be done during the year.
Capacity planning: how much inputs are needed to make outputs.
Schedualling: need to have a system in place stating who does what and by when
Managing inventory: the more inventory held, more money is spent which could go towards other things.
Assuring quality: ensuring the quality of the input matches the output product
Training and motivating employees: ensuring all employees are properly trained and are motivated will create better output by them.
Locating facilities: delegating the right inputs to the right departments will increase better chances of output.
3. Describe the correlation between operations management (OM) and information technology (IT)
Modern OM relies heavily on IT that OM can not do their jobs without IT. OM allows managers to:
- Find out what resources and how much of it is needed.
- Know when the work needs to be done
- Know where the work will be carried out
- Know how the work will be performed
- Who will take part in doing the work
4. Explain supply chain management and its role in a business
Supply chain management consists of managing the flow of information between and among stages in a supply chain to increase the profitability and effectiveness in the total supply chain. Its role is important in a business as it allows more efficiency in its productions of good and services- being more effecting and efficent in turning inputs into outputs.
5. List and describe the five components of a typical supply chain
•Supplier: supplies the raw materials (also known as inputs) to the manufacturer.
•Manufacturer: produces raw materials into products (also known as outputs) for distribution.
•Distributor: recieves the products form the manufacturer in bulk and sells to retailers.
•Retailer: sells the products to customers (known as target market).
•Customer: known as the end party consume the product purchased.
Dis-intermediation is caused from the use of eCommerce. This is known as the removal of stages in the supply chain (e.g: customer directly dealing with the manufacturer, instead of through the retailer).
Below: an example of travel and tourism supply chain
6. Define the relationship between information technology and the supply chain.
In the supply chain, IT plays an important role. It is relied on to make accurate decisions reflecting each step in the supply chain. Without IT, businesses would be either
- Creating too much stock which is not selling
- Creating too little stock which is in high demand
With the help of IT, businesses are able to keep record on how much stock is available at present, how much needs to be orded in the future and also make decisions to whether profits are being generated from the goods sold and whether they should contine to produce them or not.
Below: video shows examples of ways to control stock