At the end of the day, customer centricity determines the reason why organisations exist and why others are more competitive. How strategic then, is your operations management? In essence, strategic operations management is the engine that turns strategic plans into real-world results, making an organization more efficient, responsive, and competitive. and all support required for that market entry. Key decision areas that are critical for this execution are then converted into processes, capacity, inventory, workforce and quality to drive the strategic goals. On performance management, critical KPIs, risk management and continuous review is deployed to ensure that the strategy stays on course to respond to any changes effectively.
Supply Chain
How Strategic Is Your Operations Management?
By Michael Nzule
Preamble
I really do not understand why operations is downgraded in perception or importance... ever heard top executives barking to staff... that is operational... not strategic and not for me? Operations staff are relegated. I know one service organisation which tried to re-define what was“ operations department / back office” as“ infrastructure”... loosely relating this to furniture and fittings( in my other world of financial reporting this would be equivalent to PPE- plant, property and equipment...).
In other experiences, commercial teams, after hunting for customers and handing the accounts to operations team to deliver service get disappointed on how operations“ kill” their customers... worse still the finance teams do their part when they step in to collect debts, outrightly ignoring the investment in winning customers. Their tag line is-“ you sold credit, not profits, do not allow us to manage the bad end of the selling process, cash is king, and we got no business dealing with bad debts, you might as well forget the customers.” We can go on and on, but the reality is just how strategic then, is operations management?
Just how strategic then, is operations management?
Operations management is highly strategic because it translates overall business goals into tangible projects and initiatives, cascaded from the long-term strategy. This is driven by focus on longterm decisions like facility design, supply chains, quality, efficiency, cost-effectiveness and competitive advantage. Operations management effectively bridges highlevel strategy with daily execution for sustainable growth and customer satisfaction. Contextually, a corporate strategy might set a decision for new market entry. Operations management then plans the production, distribution
At the end of the day, customer centricity determines the reason why organisations exist and why others are more competitive. How strategic then, is your operations management? In essence, strategic operations management is the engine that turns strategic plans into real-world results, making an organization more efficient, responsive, and competitive. and all support required for that market entry. Key decision areas that are critical for this execution are then converted into processes, capacity, inventory, workforce and quality to drive the strategic goals. On performance management, critical KPIs, risk management and continuous review is deployed to ensure that the strategy stays on course to respond to any changes effectively.
Long term decisions are on a bigger scale. Typically, these include choices about service and product design, capacity, location, quality and the supply chain that guide the businesses over a longer time horizon. Tactical decisions and strategic initiatives are short term in nature and execution. They support the long-term strategy. Examples include executing targeted marketing campaigns, setting production schedules and staffing shifts and budgets. These are executed by the middle management and take the form of supervisory roles. Day to day operations like shop floor daily targets, plant set up, machine set ups, inventory level decisions are repetitive daily tasks. These have direct impact on efficiency, productivity, costs, quality and customer satisfaction. Tasks at this operational level are misconstrued to be the whole scope of operations management and not strategic! This is far from the truth.
Operations management is strategic. As part of management, it covers mostly planning, coordinating and controlling. Organisations are involved in the transformation of resources( inputs) through defined processes to deliver outputs which have value to customers. In so doing, operations management
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