Operations Management – Doing The Job RIGHT

Achieving operations excellence is an important endeavor for all companies – it is the golden path that leads to increased value over the long term. By applying operative levers systematically and managing them correctly, companies are doing everything in their power to ensure that they follow their selected corporate strategy. It helps them answer some critical questions: What value should my company create itself and what should be achieved by external parties? Where are my company’s end production sites located and which key technologies and products take center stage? How does my company manage innovation and where is it supported? Where is the company’s supplier base mainly located and how can we steer the supply chain with maximum effect?

When answering these questions, one has to keep two things in mind: What do leading companies do? and What can be learnt from their approach? Operations management takes up these questions. Operations management is an area of management concerned with overseeing, designing, and redesigning business operations in the production of goods and/or services. It involves the responsibility of ensuring that business operations are efficient in terms of using as little resources as needed, and effective in terms of meeting customer requirements. It is concerned with managing the process that converts inputs (in the forms of materials, labor, and energy) into outputs (in the form of goods and/or services).

Bear in mind that operations excellence, ultimately, is not a question of geniality – it is more a question of an appropriate approach and fit to strategy and of continuous improvements, as Henry Ford knew very well. At the beginning of the twentieth century, Henry Ford developed modern assembly lines for the mass production of cars, which marked the beginning of a decisive and formative paradigm shift. These days the principle of operations excellence has spread far beyond traditional manufacturing industries and now shapes entirely new sectors.

Companies that have the correct operative strategy and are prepared to make sometimes difficult changes in order to improve their business are acknowledged as best-in-class. It is these that reach best practice status.