Operations Management & Supply Chain Management

Define the term operations management

According to Baltzan, Phillips, Lynch & Blakey, operations management  is the management of systems or processes that convert or transform resources (including human resources) into goods and services. This system is responsible for managing the core processes used to manufacture goods and produce services.

 Explain operations management’s role in business

The role of operations management in business can be summed down to supplying certain activities for the business. These are:

·         ForecastingEstimating demand, conditions and growth

·         Capacity PlanningPlanning amounts

·         SchedulingCreating and maintaining schedules

·         Managing InventorySelf-explanatory

·         Assuring QualityQuality is indispensable. Customers expect high-quality products and services. This focuses on efficiency and courtesy

·         Motivating and Training EmployeesAlso self-explanatory

·         Locating FacilitiesFinding places to situate your business and its resources

Describe the correlation between operations management and information technology

The correlation can be seen through this quality:

·         IT is able to influence operations management decision easily through productivity, costs, flexibility, quality and customer satisfaction

Explain supply chain management and its role in a business

A supply chain includes all parties involved, directly or indirectly, in the procurement of a product or raw material.

Supply chain management (SCM) involves the management of information flows between and among stages in a supply chain to maximise total supply chain effectiveness and profitability.

SCM’s role in business is to follow its five components to benefit both the company and its customers.

List and describe the five components of a typical supply chain

The five components of a typical supply chain are:

·         PlanThis is where the company plans its strategies for supply. Companies need to have plans for managing resources and meeting customer demand.

·         SourceCompanies choose suppliers that will deliver the goods and services required for making their own product.

·         MakeThe company manufactures its products. It goes through the phases: production, testing, packaging and preparing for delivery.

·         DeliverAKA ‘logistics’. The set of processes that plans for and controls the efiicient and effective transportation and storage of supplies from suppliers to customers. Companies receive orders from customers, fulfil them, pick transport options and deliver the product.

·         ReturnReceiving defective and excess products. Supporting customers who have problems with delivered products.

Define the relationship between information technology and the supply chain.

The relationship between these two can be seen through the role of IT in the supply chain. This role includes:

·         The creation of the integrations or tight process and information linkages between functions within a firm (between marketing, sales, finance, manufacturing and distribution).

·         It helps the supply chain through it’s three integration platforms: planning and control supply chain integration, information integration and business process integration. Which are also made up of the five components of the typical supply chain.

·         IT is also a major influence on the factors that drive supply chain management: visibility, consumer behavior, competition and speed.