Operational management
In the narrow sense operational management concerns the management of primary (production or services) and secondary processes. Basic processes are directly related to the implementation of key goals: production, purchases and sales of products, services. Secondary processes concern for tasks such as: supply, transportation, storage, operational support, maintenance, record keeping.
Operational management as management function
However, in a broader sense operational management include all aspects that are associated with the processes of transformation of the factors of production (inputs) into finished goods or services provided to customers (outputs). Result of the transformation process: products manufactured or services rendered. Activities enlarging the value of goods produced and services rendered are taking place as a result of implementing a variety of operations, such as research and development, logistics (supply, production, distribution) and financial decisions, personnel development, etc.
Operational management is the oldest business management function. Without effective implementation of operational functions other company functions such as marketing, finance, research and development becomes irrelevant.
Development of operational management
The development of operational management occurred during the industrial revolution (eighteenth / nineteenth century), resulting from the rapid changes in technical, economic and social areas related to the emergence of large-scale industry factory and industrial civilization. During this period machine production was first used on a massive scale, running the recurring processes. Improvement resulted in eighteenth and nineteenth century from scientific works by: Adam Smith (1766), James Watt (1769), Eli Whitney (1799). They proved the growing importance of the organization of production and labour as a factor of competitiveness.
| Operational management — recommended articles |
| Value chain model — Industry — Production — IT systems in value chain management — Inventory costs — Business improvement — Process innovation — Logistics system — Resources and capabilities |
References
- Birdi, K., Clegg, C., Patterson, M., Robinson, A., Stride, C. B., Wall, T. D., & Wood, S. J. (2008). The impact of human resource and operational management practices on company productivity: A longitudinal study. Personnel Psychology, 61(3), 467-501.
- Russell, R. S., & Taylor, B. W. (2003). Operations management (Vol. 3). New Jersey New Jersey: Prentice Hall.
- Stevenson, W. J., & Sum, C. C. (2009). Operations management (Vol. 8). Boston, MA: McGraw-Hill/Irwin.
- Slack, N., Chambers, S., & Johnston, R. (2010). Operations management. Pearson education.
Author: Krzysztof Wozniak
