Operations management is a core function of any organization that transforms inputs into outputs. It involves planning, coordinating, and controlling resources to produce goods and services. The goal is to add value through efficient transformations. Operations can be categorized as manufacturing or service-based. Manufacturing operations produce tangible goods while service operations provide intangible activities and require customer participation. Operations management is one of the three primary business functions along with finance and marketing, and it plays a significant role in an organization's success.

1. Concept of Operations Management
Operations Management
Concept of Operations
Management
• The Classical Image
Presented By:
Anupam Kumar
Reader
SMS Varanasi
1 2
Operations Management Operations Management
It is: It is…
• A management function …the business function responsible for
• An organization’s core function planning, coordinating, and controlling the
• In every organization whether resources needed to produce products and/or
– Service or Manufacturing, services for a company.
– Profit or Not for profit
3 4
What Does Operations Management Do? Why The Transformation and How?
• Transforms inputs to – Inputs are resources such • To add value
as
outputs – Increase product value at each stage
• People,
• Material, – Value added is the net increase between output product
• Machines, value and input material value
– Outputs can be • Energy,
• goods and / or • Information,
• To Provide an Efficient Transformation
• services • Technology, and – Efficiency – means performing activities well at least
• Money possible cost
5 6
Anupam Kumar 1

2. Concept of Operations Management
Types of Operations Types of Operations
• An operation may be broadly divided into two • Manufacturing Operations
categories. – If a company has an ability to manufacture tangible
products, we call it a manufacturing company.
– Manufacturing Operations
– Manufacturing operations deal with goods/tangible
– Service Operations. products.
– Example industries:
• Agriculture,
• Forestry and fishing,
• Mining, Construction, etc.
– Inputs (raw materials, etc.) and outputs (products) are
tangible and visible objects.
7 8
Types of Operations Types of Operations
• Non Manufacturing Operations • Service Operations
– Even in service operations, there are inputs and outputs.
– Manufacturing transformation processes are some – The output is a satisfied customer.
kind of chemical or physical processes – Processes in service operations include
• giving advice (consultant firms),
– (ex: welding, assembling). • transporting,
• packaging,
• The other companies who are not manufacturers • storing,
are referred to as service companies. • serving (food), etc.
• Examples of service organizations include
• Example industries: – Educational institutions,
– Transportation, Finance, real estate, insurance, hotels, – repair shops,
– Barbers, etc.
etc.
9 10
Types of Service Operations Types of Service Operations
• Product Based Service Operations • Proximity to Customer
– Some service operations deal with tangible outputs even – In most service operations, customer needs to be present
though they do not manufacture a product. e.g. as an active participant. e.g.
• Health care,
• Distributors,
• Hair cut,
• Mail service,
• Travel, etc.
• Library, etc.
• Remote Operations
• Pure Service Operations – In some service operations, customer is not present as a
– Other service operations deal with intangible products. participant. E.g.
– These are pure service operations. E.g. • Architectural design,
• Financial advice, • Repairing automobiles,
• Counseling, etc. • Insurance, etc.
11 12
Anupam Kumar 2

3. Concept of Operations Management
Operational Transformations Operations as a Function
Operation
Inputs Transformation Outputs • Operations function is
System one of 3 primary
functions within a
Car Factory Raw Materials
Fabrication &
Cars business:
Assembly of Cars
– Finance,
– Marketing, and Organization
Chemical & Other Gas, Petrol,
Oil Refinery Crude Oil
Processing Kerosene, Diesel, Etc – Operations.
• Operations function
Airplane, pilots, must also be well
Airlines flight attendants, Air Transportation Change of place
customers integrated with other
Operations
parts of business.
Hospital Patients Health Cured patients
13 14
Operations Operations Function
• Work of 3 primary
functions – Finance,
• In many companies,
Marketing and
operations function retains
Operations, overlaps
the greatest percentage of
each other and employees.
• All three must work
• And, it is responsible for the
together to reach the
largest part of the budget.
full potential of the
system.
15 16
Operations Function
To Production V/s Operations
Management…
Therefore, operations function plays a
significant role in success of businesses.
17 18
Anupam Kumar 3