Supply Chain Management
Supply chain management is the management of flow of goods and services from the time raw materials are procured from the suppliers to the moment customer buys the product or service. It involves streamlining all the processes, in between, to ensure maximum customer value and a competitive edge in the market.
The supply chain consists of following parts:
The overall plan or strategy
Sourcing of Raw Materials
Delivery or Logistics
Support services (Repair or returns)
An operations mangerâ€™s main aim is to reduce shortages and cut down costs. Small continuous improvements over a long period of time can have a lasting impact on costs and production times. This philosophy of continuously improving operations of anything be it a store or a factory is an important part of Japanese firms which have led companies like Toyota to become leading car manufacturers in the world. The concept of Kaizen (as it is called in Japan) encompasses everything from improving employee morale, managing relationships with suppliers, to improving everyday tasks to make the job more fulfilling and less tiring.
Workflow and Staffing
A workflow is a visual step-by-step representation of a process followed by employees in a firm. Workflows can be created for any processes, be it manufacturing a tire or approving a loan. Operations managerâ€™s often need to adjust or modify workflows in various departments to ensure optimal efficiency and minimal costs. Since they are aware of issues in other departments, they are better suited to adjusting the workflows (which usually involve employees from various functional areas).Operations managers often work with HR to train their employees and resolve disputes. Another aspect closely linked with workflows is staffing, operations personnel along with HR have to figure out the optimal number of employees required for a process.
Oversight of Financial Information and Budgeting
A large portion of Operations managerâ€™s job is to create budgets for various departments of a firm. A budget is a prediction of revenues and costs over a particular time period which is re-evaluated on a periodic basis. These budgets have to be monitored regularly and curtailed if necessary, to bring down the costs of a company. The budgets are also supplemented with cost benefit analysis. In a cost benefit analysis, the manager attempts to get the raw material of required quality at best prices and oversee production techniques to ensure optimal efficiency.
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