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Extensive notes: role of operations management

Business Studies Notes Role of operation management: Strategic role of operations management- Operations refer to the business processes that involve transformation or, more generally, ‘production’. Applies both to the manufacturing and services sector. Turning raw materials and resources into outputs of finished goods or products. Qantas operations are strategically important because most organizational activity comprises the day to day activities within the operation function. * Cost leadership- Cost leadership involves aiming to have the lowest costs or to be the most price-competitive in the market.Qantas; Economies of scale, these are minimizations of cost because of the size of the business. Standardization, the more variations Qantas’ services like the types and frequency of the routes the higher production cost per unit. Technology, the adoption and application of advances in technology directly impact on production costs, reduction in labour costs. Waste, minimizing waste will deliver the lowest production costs, excess production, underutilization of labour or equipment, faulty or defective production and excess inventory. Goods/service differentiation- this approach does not mean competing on cost but by adding features to differentiate its products or service from its competitors. Qantas, Australia’s largest airline offering the most comprehensive domestic and international coverage. City flyer express service means that there are flights every 30 minutes in peak periods between the major capital cities in Australia. Also 76 international destinations. Qantas budget airline Jet star.Goods and services in different industries- manufacturing- standardized or customized products, perishable or non-perishable products, intermediate goods service- standardized (fast food) or customized (doctors, legal services etc. ) or even self-service. Interdependence with other key business functions- human resources, finance and marketing –exist because of and to support the operations function. However, operations cannot succeed with out their contribution to and direct participation in the transformation of inputs into the final outputs.

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