Operations management (OM) is a faculty of management that is concerned primarily with supervising, designing, and controlling processes within a production function; the essence of OM is to redesign business operations, especially in light of producing goods while tendering services. OM takes into consideration the responsibility of underscoring the efficacy of specific business functions that must be realised by way of using the limited resources to meet the needs of consumers. Moreover, operations management deals with the efficacy that involves the conversion of inputs, such as labour and raw materials into effective results, such as tangible and intangible products.
Precisely, the essence of OM is its capacity to utilise capital and human resource capacities like knowledge to convert materials and services into either tangible or intangible products (Karamat 23). The basis of operations management is to design the systems that control an enterprise such as arranging the facilities, coming up with procedures that align the business with inventory acquisition, and scheduling business tasks and turnover, while providing a safe passage that ensures changes occur in a smooth business curricular.
Operations management, just like in any other business endeavour, falls under a categorisation scheme that classifies it in terms of the degree of standardisation, manufacturing, and production. Manufacturing, for example, produces tangible goods that must reach out to consumers. Markedly, such a distribution system must be upped to get them to their targeted destination. Service industries, on the other hand, tend to deal directly with their customers, thus making distribution a less likely challenge. Here, the concern is to make the services available to the consumers. Broadly speaking, the focus is on what operations managers can do in order to attain a high rate of production in a management function. According to recent research on this area, the high-involvement employment practices, for example, can create positive attitudes in order to maximise production (Demchenko 64; Shin 246).
Massey (276) and Soupata (96) concur that the practices help to generate the types of flexible behaviours that may lead to enhanced performance in the end. The section, hereafter, examines production processes in operations management, and how managers utilise them in both the service and manufacturing industries in order to benchmark their priorities in a production functions. The subsequent subdivisions briefly discuss the literature for the efficacy of these components of operations management. Additionally, the last part deliberates on the execution course, as well as debates on the significance of holding on a participatory viewpoint in operations management.
A robust approach to production of manufactured goods and services is its insistence on lean production. Production process, according to Karamat (27), draws meaning from the fact that it warrants little inventory time, as well as other resources that augments production. Operations management, therefore, is a process of supplying goods and services to various clients. To explore fully the functionality of operations management, there might be the need to look deeply into the term operations itself. Operations as a word offer the meaning for production functions, as well as service processes. According to Soupata (99), the shared destiny for each of these forms of operations is underscored by the fact that both passes out as transforming processes for both the business and community.
Under each categorisation, both the processes ensure that specific inputs are converted into various forms of outputs. Under these considerations, it may be fit to presume that all that goes within a business function such as planning and control are specifically duties of operations management. In addition, operations management cannot be complete without decision-making; all these functions have to be directed by a power brain-house of some sort that defines the functionality of all these processes. Usually, it is upon the decision-making team to come up with the general strategies that streamlines the organisation with its external environment. To function optimally, operations management often explores the four domains of decision-making. The domains include process, capacity, quality, and inventory. Therefore, operations managers are by virtue of their positions dutifully entrusted to the delivery of these processes to the satisfaction of all the parties involved in a business function.
In its intuitive nature, operations management traces its roots from a shift in the manufacturing and service industries, which coincidentally are the core elements of every economy. As the service industry gains more acclaim, there is need to put great emphasis on it to offer the utmost results. Under these schemes of activities, the shift from production to operation stresses the need to broaden the scope of business to service-oriented organisations. Perhaps another widely professed change was realised by way of emphasising on synthesis, while giving equal amount of weight to analysis, especially in the concept of management.
According to Karamat (34), managing operations can be defined within the meaning of the general operations management. Apart from decision-making, operations managers are also entrusted with the duty of planning, organising, as well as controlling various activities, which in effect shape up human behaviours through a set of defined principles. Whereas planning by top-notch managers offers the foundation stone capable of driving the business into the future, organising, on the other hand, institutes a course of action that guides the business into a prosperous future.
A real world example would require operation management teams to come up with a method of transforming inputs into outputs that the organization deem most beneficial such as balancing costs with revenue in order to obtain the highest possible net profit.
Growth in the rapidly demanding socio-economic and political environment has unconditionally informed the need for business organisations to be more competitive in the demanding operations management trends. Evidently, an organisation’s success or failure depends on management. More than ever before, the success of business organisations calls for a completely new ball game in approach to streamlining their service provision. Researchers in the service sector offers that reward, for example, has long had an inducement that augments the service processes within an organization, and for inducements to be truly operational, the actual reward must be tenable, that is, 15% to 20% of the base pay. Performance-based reward packages that provide minimal rewards, that is, less than 10% of the base pay are hardly motivational enough to bring meaningful changes on the behaviours of humans, and are, perhaps, not worth the concern and outflow involved in its implementation.
By accepting a comprehensive dynamics of performance in order to embrace the cumulative results of a consortium of individual efforts, many organisations have been able to maximise on the reward strategic plans to transform corporate stratagem down through the ranks and files. Active use of enticement model shows that reward schemes are more than schemes for compensating workforces reasonably to deliver on various service tags. By extension, they tend to communicate management prospects by impacting on an individual’s capacity to deliver.
In cases where the skill and experience-based payment has been applied, it tends to create somewhat a higher pay regime for individuals. However, this is commonly offset by the larger workforce flexibility and high performance rating (Soupata 104). Flexibility habitually leads to lower staffing mechanisms, fewer concerns when absenteeism or poor turnover is experienced, and certainly, it often leads to lower absenteeism and turnover. This is because many people prefer to utilise the opportunity and be paid for a wide-range of skills that they possess, as well as services that they offer. As a manager, you need to understand these needs and communicate these priorities to your workforce by providing the uppermost per unit incentive as a measure of reward portion (Soupata 107).
Strategic reward could be based upon the design and an enactment of the long-term reward scheme and operation managers might choose to explore these to closely support their employees while advancing organizational objectives and worker aspirations.
According to Bektas and Crainic (27), capacity management has always been driven and, often, challenged by four domineering factors. The factors are elaborated below.
- Evaluating, understanding, and reacting to the roles of management dynamics and customers’ requirements in the competitive supply chains
- The necessity to respond flexibly and reliably to the ever-changing customer demands with unified and conjoined coordinated operations through different modes
- The knowledge of existing and impending market niches and the global operational alternatives and options, including the prospective for an enriched information and communications technology, as well as the challenges connected to their applications;
- The last factor is the coordination of the infrastructural capacity, which comprises regulatory, and policy factors, as well as improved management of the available infrastructure and a broader consideration on future investment plan.
Employees, for example, will naturally need to see that their direct efforts influence the results that the management intends to achieve. It is noteworthy to observe that nobody would like to be held responsible for actions that they cannot accomplish from their own initiatives. With the appropriate trend and apt preparation, the workforce gains more experience in their areas of specialisation. As a result, the training ease employee’s rates of conveying their expertise to upsurge the market share in order to earn the worthwhile enticement pay-outs.
However, having a factual merit based pay or promotion strategy often easier said than done. Indeed, observations have been made whereby many organisations tend to shy away from the pay and promotion to performance strategy, and merely relying on other means of motivating performance (Bektas and Crainic 35). Strategy involves the plans that organisations put to guide their future operations. It also involves environmental screening and forecasting; these programmes enable firms to predict into the future, thus gaining competitive advantage over their competitors. Performance-based prises are both the group and individual targets that bear a realistic prospects of being attained within the provided limited timeframe.
If the set goals are farfetched such that most employees tend to believe that they cannot be achieved, then the programme is predestined right from the outset. Perhaps a few will be motivated in an attempt to attain such goals, while others will definitely be discouraged concisely. Alternatively, objectives ought not to be extremely easy to achieve that incentives are compensated for outcomes that may have been attained using ordinary initiatives. To avert either of these scenarios, organisations train employees to maximise their expertise and to recognise the most likely customers’ trends. Through the training activities, organisations have the capabilities to optimise the capacity to communicate to their sales agents the capacities of the fresh services or products and induce them on the likelihood of achievement.
However, this can at times produce some different results whereas these particular individuals are rewarded more than they would achieve within the meaning of a job-based system. In other cases people may not have the required skills and experience when they enter a job for the first time, thus they do not merit the kind of remuneration that goes with the job description. On the other hand, Bektas and Crainic (27) observe that skills and experience-based pay could be challenging to manage because it is not create a clear view of how one researches the market and decides, for instance, how much is worth a skill. Skill and experience assessment can as well be difficult to accomplish. Profoundly, there are a number of well-developed strategies for job evaluation and their comparison to the marketplace, but there are hardly any such systems, which really consider this aspect with respect to the skills, and experience an individual possesses (Bektas and Crainic 27).
Keeping in mind that capacity management deals with the aptitude of an enterprise’s resources, a company may choose to replenish an old product and mount a vigorous campaign to promote it.
Various organisations use management by objective scale to measure the competence and capabilities of their workforces; the assessment process includes both qualitative and quantitative objectives of the firms. In these circumstances, a company must thoroughly establish the available qualitative methods that do not give too much of an employee’s performance to a supervisory preference. Notably, the sincerity of the performance-based programme could be at risk in case the entire performance appraisal processes are pegged on judgements. In essence, employees seem concerned that management can ostensibly manipulate the outcomes merely to reward those individuals they favour, instead of those whose performance are outstanding (Soupata 102).
Sales enticement strategies, for example, are some of the informal performance-based payment systems, which are easy to establish since such deals are measurable from a qualitative and quantitative approach. In all categories of performance-based reward systems, it is necessary to provide calculable measures of results. The success of performance-based recompense, unrivalled faith in the impartiality of the system of measurement among the parties involved is vital. Besides, the designs of the measurement need the comprehension and approval of the employees, as well as the management at the commencement of a performance time. To subsist optimally within the global business niche, several human resource personnel and business consultants have stepped up their operations to meet the varying global market demands.
Ordinary researchers and academicians in various parts of the world have shown strong interest in this field, especially as evidenced in the innovative global talent management search that has taken root in most parts of the world. The emergence of quality management in recent years features vitally as a factor for enabling corporations to reach out to the worldwide consumer (Intermodal freight transport and logistics best practices 8). The efficacy of human resource management recognises the fact that success or failure of an organisation depends on its management. In line with this observation, there has been a budding recognition for the significant roles played by operation managers, particularly in safeguarding the success of the various corporations under their watch.
The essence of this endeavour is to reflect on intensifying global competition while growing the need for a global learning and innovation practices in multinational businesses. The success of any business enterprise depends mainly on the quality of management of the operation managers. Researchers all over the world agree that the scarcity of proficient quality management has become a recurring phenomenon against the successful implementation of operations management. Shortages of professional and managerial talent continue to emerge as key human resource challenges that face several businesses organisations. In addition, many research studies hold that the major obstacle facing most organisations is the shortage or ineptness of quality management (Soupata 105).
Using ISO 9001: 2008, for example, may assist an organization to ascertain that their customers get the reward of their money by producing consistent, quality products as well as services that definitely brings organizational benefits.
Equipment and Other Physical Resources
The ability of operation managers to manage their corporations efficiently is expected to draw a clear distinction between success and failure. Accordingly, the need to identify and develop well-rounded leaders for the future, with a purposeful global focus, involves the recognition of the fact that organisations can reap from transfers of knowledge, expertise, skills, and experience (Benchmarking intermodal freight transport 49). Most importantly, however, is the balancing act, organisations must learn to balance between global, regional and local needs. The balancing act is the extent to which managers allow their organisations to reach out to the optimal matrix of local, regional and global operational preferences alongside the established business standards that have become almost always commonplace in modern day management. In retrospect, it is expected that operational mangers will influence change based on the value that talent brings to management. For the better part of the 21st century, these essential elements may feature outstandingly as key management differentiators.
Managers, for example, must ensure there is no time wasted between employee particular performance and the related pay-out packages. In general, workers would always desire to ‘see’ the effects of their inputs by rapidly realising the impacts. There are several means to relate performance to pay, and one of the most outstanding strategic decisions by many organisations is how to do this (Karamat 67). The options available to organisations are manifold. The type of pay reward scheme can extensively vary and may include such things like stock and cash. Again, the frequency with which the rewards are awarded may vary massively from time scales of a few minutes to many years of service.
Performance may be measured at an individual level so that each individual receives a reward centred on his or her performance at work. The rewards can also be administered based on group performance, and the overall organisation. Lastly, there are other types of rewards, which can be rendered based on position. For example, managers may be rewarded for increase in sales, productivity volumes including the capacity to develop their subordinates and their cost reduction ideas, among other things (Karamat 37).
Supply Chain Network
An operations management that comes with the options of assimilating numerous methods offers a readily elastic reaction to the dynamic supply chain that is fundamental in the distribution systems and the general management structure. Amalgamation of approaches necessitates a systems methodology or a procedure of implementation and a given mark of knowledge and skills on the carriage and supply chain, equipment, information and infrastructure. The concept of supply chain, as it evolves from a central infrastructural component to a universal focus on the processes or systems is expected to have a relatively more sustainability factor and applicability in as far as global supply chain management (SCM) is concerned (Intermodal freight transport and logistics best practices 10).
Zhang and Zhang (276) observe that the modes of supply chains, much like the modules of transportation, have been in existence for a while. However, it is only in this phase of information and communications technology that the supply chain practices, and the modes supplementing the course, that the momentum of being integrated has been much intensified. This integration has the ability to guarantee the optimisation of trade-offs between the modules of the supply chains and between the services and cost patterns of the modes within the supply chains (Benchmarking intermodal freight transport 52).
The responsiveness and necessities for choices on a business implementation of supply chains rely on modern communications and information structures for their success. A good illustration that is gaining universal momentum and efficacy is the application of interpersonal databanks — the capability to electronically incorporate and manoeuvre interconnected but rather diverse data arrays. The concept of people is a vital component in modern operations management for the people are the “engine” behind the workload. Operations management and development are an intellectual activity that is truly human conscious.
In many cases, human beings execute most of the work elements, and barely a little of this workload can be automated. Therefore, this research notes that the availability and the competence of the people in management are keys to getting the work completed in the best way possible. In addition, most of the cost of production and development is associated with the people (Benchmarking intermodal freight transport 55).
The process of engaging people at all levels in an organisation’s transition to the desired future is extremely beneficial. Its objectives are to ensure that people are both able and willing to accept the basic new behaviours and practices while letting go of those that are no longer appropriate. People’s participation in operations management within an organisation is accepted as a means of mobilising the human resource capacity to cumulative productivity (Josler and Burner 1). Building a formidable team is among the most crucial things that an operations manager can always endeavour to achieve. Osterloh and Frey (541) posit that motivation, and avoidance of demotivation may take an organisation to greater heights. In essence, leaders need to be acquainted with what motivates an employee. This gradual process needs to be continuously monitored, modified, and updated over the life of a business (Turner and Muller 54).
Inventory management, as Karamat (20) indicates, is determined by the yield realised when an organisations input is fully utilised. With regard to this context, organisation performance shows the relationship between the input and the achieved output in an organisation, hence determining the growth of an organisation. Karamat (20) assert that the organisation’s success relies on three issues namely: Efficiency and process reliability, leadership and relation to workers and, inventory management and adjustment to environment. Considering the leadership impact of an organisation, Karamat (27) states that the size of an organisation effects efficacy of managing the business records, which translates to the management structure. However, for high performance, every organisation irrespective of the size requires aggressive management that can pool their records together and can as well establish appropriate organisation composition, systems, and structures Karamat (29).
Therefore, record keeping, as the key influencers in making decision, determines what the organisations acquires, develop, and where the organisation deploys their resources. In addition, Karamat (29) acknowledges that leadership determines the conversion of these resources to product and services and correlation with an organisation’s targets. Thus, inventory management, even though not the only determining factor is an essential component in the mix of factors that impact on the organisation’s performance (Karamat 30).
Recent researches suggest that competent inventory management can nurture the positive beliefs and attitudes that are allied to operations management, and that, such practices can produce the kinds of discretionary activities that lead to enriched performance (Josler and Burner 2). In more certain terms, personnel who comprehend the work design and execute workplace records and procedure variations are a dedicated workforce. Operations management is imperative to the effectiveness in the current business environment.
The Gallop Organisation, which researched on the field of operations management in 7,939 professional units, in 36 firms, established that inventory management was connected to positive performance in various sectors, such as augmented client’s satisfaction, productivity, and effectiveness, as well as increased workforce output. Most companies that nurtured effective inventory management shows that extent of operation management was noteworthy afterwards (Cabrera and Cabrera 25).
In general, operations management reveals three interconnected consistencies: an emotional, behavioural, and a cognitive trait. Whereas the cognitive aspect of an operations management guarantees employees’ beliefs about the organisation, its leaders, and working conditions, the emotional aspect on the other hand concerns how the employees feel about each of these underlying factors and whether they possess the positive or negative traits toward the organisation and its leadership (Josler and Burner 5). The behavioural trait in particular is a value-added constituent for an establishment and comprise of the unrestricted strength that a dedicated workforce bring to their performance in terms of capacity building, output productivity, and energy devoted.
The successful management of a demand task depends on a business researcher’s ability to effectively plan, manage, and perform the actual research. Most scholars do not strictly conduct their studies, and whereas this does not imply that the study will not be concluded productively; this methodology has effects on the workforce engaged in the specific venture. For instance, an unanticipated method may cause strain among participants of the research group. Again, crises emanating from failure to meet targets may arise. Therefore, the starting point for engaging people in operations management is to have a strong understanding of what you are trying to achieve in the first place (Josler and Burner 6).
A simple model to study this is to differentiate between the yields and results. Outputs on one hand are the physical deliverables that an organisation acquires while outcomes, on the other hand, are what happen because of the outputs. The core of an operation function is to outline what the anticipated outcomes are and from this brief, the outputs can amicably be defined (Brewster, Hegewisch, and Lockhart 40). Stakeholder planning and management
Stakeholders are people who have a stake and willingness to the involvement of a project. Poor management may result in communication breakdown within the plan of an organisation; therefore, the skirmish between the stakeholders particularly if their objectives are contending for precedence within the task (Josler and Burner 8).
First, identify the main stakeholders. After identifying the interested parties, divide them into small sets since large clusters can affect the relevance of the information acquired from the development. The second item is to comprehend the dealings that are realised upon interacting with the interested parties. Guaranteeing that transactions are fully comprehended at the onset of the operation is vital, as it will avert conflict and rigidity later in the positioned strategic plan. Having done with the process of stakeholder identification, the next phase is to map them to realise the relationship amongst the groupings of stakeholders (Chan 224).
Kwak and Anbari (441) identified the four knitting principles for building a sustainable operations management practices that help to certify that a system will be effective and that the several practices will work harmoniously to have a positive influence on operations management. These ideologies can be deduced as providing employees with the following capacities as suggested by Kwak and Anbari (443). Information, according to Chan (225), consists of data, which includes facts on the quality and quantity of corporate unit yield, incomes, viability, as well as customer responses among other things. A key test for the human resource departments in any organisation is to try to develop a high-involvement structure that provides employees with statistics, which is both timely and appropriate to their specific task. The more open executives are the more effective staffs will add to the success of the company.
Being honest with information is important since it enables the employees to see the connection between their actions and the performance of the firm, thus enhancing the cognitive side of engagement (Chan 226). Since knowledge consists of workers’ abilities and skills, enhancing their knowledge, skills, and abilities require a commitment to continuous training process (Kwak and Anbari 438).
The recompense constituent of the high-involvement capacity points at recompensing the workforces for applying unrestricted strength to improve the performance a firm. A key component in the high-involvement factors and rewards for performance is to ensure that the employees use their power, knowledge, and information for the good of the firm (Chan 235). In this essence, power denotes that workers have the responsibility of making critical decisions within the establishment since such decisions affect their lives directly, as well as the performance of the group. Peoples’ involvement is maximised if the highest imaginable level of power is laid down to the employees, thus they have to be part of the framework (Demchenko 34). Such programmes provide forums for workforce to design new ideas among themselves. However, these are most achievable when the best ideas from the employees nurtured and put to good use (Shin 250).
Push and Pull inventory strategies
As the world’s economic landscape keeps on shifting and rapidly becoming global, clear-cut management practices are needed to ascertain the business stays within the competitive optima. In virtually every organisation in the developing as well as in the developed economies, critical resources, market opportunities, innovative concepts and competitors, lurk not only within the same geographical setting, but also in the expansive global outreach. The greatest concern of the 21st century is rather how successful organisations are, at exploiting the evolving opportunities while tackling their underlying challenges as well. Achieving such a great feat depends solely on how intelligent an organisational operative is displayed, as well as interpreting the dynamics of the world under which it operates.
Cultivating strategic inventory strategies is essentially a key ingredient that is required for nurturing such intelligence. The environment under which most organisations subsist is more than ever before, complex, global, dynamic, extremely volatile and yet, highly competitive. This trend is not only expected to remain as such, but is also expected to further escalate in the years to come, especially regarding the ever-changing market trends. Apart from these external conditions, research documents that numerous organisations currently face many inventory challenges, especially those linked with talent flow, generational conflict including the shortage of much desired competencies.
The authors hypothesise that among the major institutional challenges for most organisations is that their lifeline depends solely on their propensity and wish to keep lean records. In addition, organisations aspiring to be on the competitive mode have to be systematic, especially in managing their human resource capacities. Essentially, this aims at streamlining the organisation in an attempt to reach out to the global household consumer in order to sustain a competitive advantage.
In essence, operation management is expected to be such a significant aspect in the success of hyperactive competition among the future supply chains. Its more momentous function in the modern day supply chains necessitates a comprehensive knowledge of the SCM, the needs and demands of the market, the advances and capabilities in the information and communications technology, as well as the present challenges and precincts on business arrangements (Intermodal freight transport and logistics best practices 12).
Currently, it might be presumed that the prospect of the business progression and the options in the supply chains have to emanate from the demand or supply chain manifestations rather than from the traditional supply or mode carrier aspects. The process involves coordination of holistic approaches by incorporating all stakeholders in the supply chain in identifying and analysing possible risks and mitigation options. A well-drafted mitigation plan to mitigate the risks must inculcate the finance, logistics and risk management parameters with the intention of ensuring business continuity and fewer interruptions in order to increase profitability.
With increasing uncertainty in the current business environment, risk management within the supply chain remains essential in enhancing smooth functions. Disruptions in the supply chain of a firm reduce revenue, as they cut into the market share. For instance, a cut in the supply chain makes it difficult for a company to manufacture, deliver, or sell goods. When a firm cannot carry out its operations, there are high possibilities of investors’ withdrawal, as well as withdrawal of other significant stakeholders.
From wherever the impending stimulus for the business growth comes, any additional visions, modifications, or alterations need to be discerned through assessing it in a broader definition and not just on traditional historical containerised context (Tohidi 927). Consequently, an enlarged cognisance of the scale and opportunity of an extensively expressed and mediated business appeal will enhance the urge for business education and awareness for those aspiring to organise and implement both new business technologies, and communications and information systems in the progressively constrained infrastructure of business operations.
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