5.1 The Role of An Operations Manager

What is Operations Management?

Operations management (also referred to as production) deals with production and is about providing the right goods and services in the right quantity and at the right quality level in a cost-effective and timely manner.

Production is interlinked with all business functions. Whatever the reasons are for the change in operations management have a direct impact on all functional business roles.

Operations Management and links between other business functions

Marketing

• Marketing of goods and services are heavily impacted by production. For example, exclusive and limited produced goods/services or luxurious goods can have great profit margins as they can be marketed profitably.

HRM

• In regards to human resource management, production dictates who to hire. For example, labour intensive production will require vast amounts of human workforce, while capital intensive factories will need less.

Finance

• Access to finance or available finance can dictate what production methods the business will use or vice versa. Capital intensive production methods are it's namesake; expensive. Lean production will require heavy investment in machinery and automation.

Operations Management and the Provision of Goods and Services

Although it may appear that it only involves production (secondary sector), it actually involves all four sectors of the economy:

• Primary sector

• Secondary sector

• Tertiary sector

• Quaternary sector

There are four factors of production: land, labour, capital, and enterprise. Each factor influences where, how, and why the mode of production is chosen. All are combined in a cost-effective manner to ensure added value in order for the business to sustain itself and make profits.

Sustainability in the Business World

Economic sustainability

The general definition of economic sustainability is the ability of an economy to support a defined level of economic production indefinitely. For businesses this refers to the ability of the business to produce output and generate sales and profits into the future

Environmental Sustainability

Environmental sustainability is defined as responsible interaction with the environment to avoid depletion or degradation of natural resources and allow for long-term environmental quality.

Social Sustainability

• Social sustainability is about identifying and managing business impacts, both positive and negative, on people.

• It relates to stakeholders and is about doing business in a way that benefits society and protects people