International Operations Management
What Do Operations Managers Do?
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| What Do Operations Managers Do? The job of an operations manager, as well as the exact responsibilities that he or she has, vary from organization to organization, largely because of the type of operations that the organization performs. For example, being ............................................................................. ............................................................................. Elsevier US Job code KIB Chapter: Ch11-H7983 6-12-2006 9:22 p.m. Page:363 Trimsize:7.25 in in Fonts used Sabon & Frutiger Margins:Top:36 pt Gutter:66 pt Font Size pt Text Width PC Depth:43 Lines International Operations Management 363 responsible for the operations of a General Motors assembly plant in the United States would involve overseeing a completely different type of operations than being in charge of operations at Barclays Bank in the United Kingdom. Operations managers, like all other managers, must be able to perform the four basic management functions of planning, organizing, leading, and controlling. Planning is about defining goals, establishing strategy, and developing plans to coordinate activities. Organizing is about determining what tasks are to be done and by whom, and how the organization is structured. Leading includes motivating employees, directing the activities of others, selecting the most effective communication channel, and resolving conflicts. Controlling is the process of monitoring performance, comparing it with goals, and correcting any significant deviations. 5 Operations managers must follow the mission and overall strategy that their organization has. Based on these, operations managers can then produce plans for the operations function of the organization. These plans should be subject to periodic review and revision and are expected to change whenever the overall strategy of the organization changes as a result of changes in the external environment. For example, a growth strategy involving the expansion of a company to anew market would require an increase in the number of operations that the various departments of that organization will have to perform. Changes in the overall strategy that an organization follows usually have an effect on the structure of the organization and would inevitably change the way in which a number of operations are performed. An example of this would be the changes that many British universities have implemented to their academic structures since 1995, in response to the fact that students in higher education are choosing to move away from some subject areas, such as those within the sciences, and toward the more creative industries, such as design and media. Apart from their good technical skills in areas such as forecasting and project management, operations managers should also have good communication skills and the ability to resolve conflicts—something that can very easily occur in the area of operations. Operations managers should also have a good knowledge of the various theories of motivation and maintain a highly motivated workforce. The controlling function is particularly important in operations, as any omissions or mistakes made during an operation will inevitably affect the quality of the product, whether this is a good or a service. Operations managers can perform either concurrent control—through direct supervision, something that could stop problems before they become too costly for the organization—or feedback control, which would enable them to provide ............................................................................. ............................................................................. Elsevier US Job code KIB Chapter: Ch11-H7983 6-12-2006 9:22 p.m. Page:364 Trimsize:7.25 in in Fonts used Sabon & Frutiger Margins:Top:36 pt Gutter:66 pt Font Size pt Text Width PC Depth:43 Lines 364 International Business feedback to their employees and would certainly be a more realistic option in bigger organizations performing a large number of operations. Apart from performing the four basic functions of planning, organizing, leading, and controlling, operations managers also have to make decisions. Depending on their style of management, operations managers may involve their staff in the decision-making process, in an effort to offer abetter product to consumers. For example, the manager responsible for operations at a busy department store based in Oxford Street in London, United Kingdom, might have regular meetings with all his staff and discuss their ideas as to how the store could provide abetter service to their customers. Within the management function, management decisions can be divided into two categories strategic decisions and operational (also known as tactical) decisions. Strategic decisions concern the development of long-term plans (normally covering five-year periods, which aim to place the organization in terms of its environment. Operational decisions concern the development of short-term plans (less than one year, which specify how the organization’s objectives will be achieved. The decision-making strategy used in operations management, that is how the operations manager tackles certain problems, will be greatly influenced by the need to achieve given objectives. Those objectives may have been determined for the operations manager by others, or jointly, or largely by the operations manager himself or herself. How the operations manager tackles certain problems must also reflect what is possible. That, in turn, maybe influenced by the type of the organization and the nature of the operations that need to be performed. The magnitude of these two constraints will largely determine the scope that the operations manager has to exercise choice, that is his/her freedom of movement’. 6 One of the main responsibilities of the operations manager is the effi- cient transformation of resources into goods or services. And the efficient production of goods or services requires effective application of operations management methods and tools. It is important hereto distinguish between being effective and being efficient. Being effective means to do the right thing (i.e., produce the right product, whereas being efficient means to do the thing right using the minimum resources. Ina local post office, for example, being efficient means using the minimum number of employees behind the counter, whereas being effective would include minimizing the waiting time for customers. Although efficiency and effectiveness are different terms, they are interrelated and closely connected. For instance, it would be easier for an organization to be effective if it ignored efficiency. Hewlett-Packard, for example, could produce more sophisticated and longer-lasting toner cartridges for its laser printers if it disregarded labor and material input costs. Similarly, some government agencies are regularly criticized on the grounds that they ............................................................................. ............................................................................. Elsevier US Job code KIB Chapter: Ch11-H7983 6-12-2006 9:22 p.m. Page:365 Trimsize:7.25 in in Fonts used Sabon & Frutiger Margins:Top:36 pt Gutter:66 pt Font Size pt Text Width PC Depth:43 Lines International Operations Management 365 are reasonably effective but extremely inefficient. That is, they accomplish their goals but do so at a very high cost. On the other hand, organizations can beef cient but not effective, simply by doing the wrong things well. A number of institutions of higher education, for example, have become highly efficient in processing students. Through the use of computer-assisted learning, distance-learning programs or a heavy reliance on part-time faculty, administrators may have significantly cut the cost of educating each student. Yet some of these institutions have been criticized for failing to educate students properly. 7 Although high efficiency is normally associated with high effectiveness, operations managers must find a balance between the two and never sacrifice the one at the expense of the other. The more efficiently the resources are transformed into goods or services, the more productive the organization becomes and the more value is added to the good or service provided. Operations managers must ensure that the organization achieves productive use of what they have, that is it obtains maximum effect from their resources and minimizes their loss, under-utilization, or waste. Productivity can be defined as the ratio of outputs (goods or services) divided by the inputs (resources such as labor or materials. This can be expressed as follows: Productivity = Output Input (11.1) Consider, for example, the case of a Burger King restaurant in New York. That restaurant employs four staff in the kitchen and prepares an average number of 154 burgers per hour. Its labor productivity will be as follows: Productivity = 154 4 = 385 burgers/hour Operations managers can improve productivity in two ways either by reducing inputs and keeping output the same (e.g., using three rather than four staff in the kitchen and keeping the same output would increase productivity to 51.3 burgers per hour, or by increasing output and keeping input constant (e.g., continuing with four staff in the kitchen but increasing output to 205 burgers per hour would also increase productivity to burgers per hour). Productivity is closely related to performance. See, for example, Mukherjee et al.’s paper which discusses a framework for measuring the efficiency of banking services and relates it to performance. 8 Performance describes how the organization does in terms of time, cost, quality, and flexibility. When there are gaps between the actual and the desired levels of performance, operations managers need to make improvements in order to close these gaps. By adopting modern Japanese management ............................................................................. ............................................................................. Elsevier US Job code KIB Chapter: Ch11-H7983 6-12-2006 9:22 p.m. Page:366 Trimsize:7.25 in in Fonts used Sabon & Frutiger Margins:Top:36 pt Gutter:66 pt Font Size pt Text Width PC Depth:43 Lines 366 International Business practices, many Western organizations have improved the performance of their operations—including reducing space, lowering inventory levels, and achieving faster throughput times—which, in turn, has lead to better financial results such as improved cash flows. Key performance indicators (KPIs), such as customer service time, cost, or quality, provide feedback to the operations manager as to how well the operations function is performing. 9 Download 340.14 Kb. Share with your friends:
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