Topic 1- operations


The role of operations supervision

The creation of goods as well as the provision of services simply by businesses. The transformation of inputs into outputs or products being sold. This requires:

planning actions

purchasing inputs

managing inventory

selecting and employing manufacturing operations

Developing ways of gain a sustainable competitive advantage.

The tactical role of management

A strategic decision can be one that influences the business in the long run. The proper goals should be improve:



quality of results

Therefore , every strategic decisions will concentrate on lower costs to a industry benchmark through efficiency and producing a good or service that is different to and competitive against rivals in the market.

You will find 3 types of strategies that are commonly used by businesses to gain and keep a competitive advantage. These are generally:

cost command

product differentiation

market segmentation

cost management

A cost management strategy can be where a organization aims to end up being the lowest price manufacturer within just its market. The products would be the basic, no-frills type with fewer features, perhaps lower quality and using low-cost packaging.

Low costs can be accomplished through:

economies of level in production and circulation,

access to cheaper raw materials

exclusive use of a large way to obtain low cost advices

Distributing the item using sellers who work with lower profit margins.

The issues that operation mangers need to be conscious are:

Opponents can use similar strategy and may achieve possibly lower costs

The business's product is not really perceived by simply customers to be equal to the competitors since competitors offer better technology, features and service.

Developments in technology change buyer preferences

Buyers may even think that these types of ‘throwaway are not eco sustainable

A very good competitor uses aggressive marketing with heavily discounted prices

merchandise differentiation

A product or service may achieve a greater market share because it is distinctively different to their competitors. It may be achieved through:

Better quality

Faster delivery

Custom designed products

Area of businesses

More features and applications

A differentiated merchandise can command a higher superior price on the market as customers are interested in the product and build up brand loyalty.

Services and goods in different industries

Manufacturing outputs:

physical, real

may be reused

more capital intensive (machinery)

can be placed

Hard to change once created.

Services outputs:


can easily be used by one customer once

more labour intense

even more interaction with customers

Simpler to change and customise.

There are a few similarities, that they both:

Employ technology

Must make predictions

Cope with customers and suppliers

Generate decisions regarding capacity

Interdependence of businesses and the organization

Specialisation – where the business is segregated into distinct functions, every of which is highly skilled in its specific job or role.

Interdependence – in which the different parts of a small business must rely on each other to perform their job or part.

There will be a continuing flow info between businesses and the additional key business functions: promoting, human resources and finance.

In marketing, study identifies the nature of goods customers' desire and marketing strategies motivate purchases.

Businesses must supply a product that has the features and quality customers demand as well as reliably distributing this product for the market.

The finance manager will create budgets and make funds available to purchase inputs, tools, repairs

Human resources will ensure that enough workers with the ideal skills


Chapter a couple of: INFLUENCES

The positive effect

Globalization offers consumers a chance to purchase...