Organisations and Operations Management
Operations management is the term applied to the activities at the core of
any organisation's business and is concerned with the way in which the
organisation actually puts into practice what it has set out to do.
An organisation will undertake operations to make a product , provide a
service or a perform a combination of the two. Hence Glaxo manufactures
pharmaceuticals;BT provides telecommunications services.
Accordingly,operations management is concerned with managing the
way products are made and/or service delivered , which has a direct
connection with how the organisation achieves its objectives.
The principles of operations management can be applied to any
On comparing and contrasting two very different organisations , it would
appear that their operations have few similarities. The operations of Glaxo
for example , would seem very unlike the operations of a chip shop run by
its self-employed owner. However , closer examination will reveal
surprising similarities. Both organisations have to choose the best
location , buy raw materials,forecast demand for their products, calculate
the required capacity,arrange resources to meet demand , use the raw
materials to make products, sell the products to customers , manage cash
flows, human resources and seek out reliable suppliers. Both organisations
want to run efficient operation with high productivity.
There are two basic ways of categorising organisations and the operations
they undertake. The first is to consider organisations as belonging to
different sectors :primary (producing raw materials), secondary
(manufacture and produce goods) or tertiary(sells goods,service-sector
An alternative way of viewing organisations is to consider whether the
organisation produce goods , provides a service or delivers a mixture of
both and whether it is a private-sector organisation or not.