What is operations management?

Definition of operations management

The management of activities, processes and decisions relating to the way goods and services are produced and delivered.

What is supply chain?

The series of activities involved in taking the initial resources and providing the final product The process can continue after consumption when the product needs to be disposed of or recycled Business activity impacts on society and stakeholder groups

Key operations tasks

Add value Operate efficiently Manage resources Coordinate supply chain Ensure quality

What is adding value?

Adding value = the difference between the price of the finished good and the cost of th run puts involved in making it. Sales revenue - cost of sales = value added

The transformation process

Inputs -> transformation process -> outputs The process describes what happens inside the business. This is where value is added. This process is a loop as products are monitored and adjusted accordingly.

Labour intensive vs capital intensive

Labour intensive - production relies mainly on labour resources Capital intensive - production is carried out mainly by capital resources