Definition of operational management, goals, characteristics and functions on business
In addition to financial and marketing management, the role of operational management is very important in a company. Understandably, the operational system determines the number of company profits and business sustainability. This means that a business is impossible to develop without a good and controlled operational system.
The proof, the operational system in a business manages all the company’s resources to produce more maximal products.
Understanding Operational Management
J.HIIZER and B.Render management experts define operational management as a form of comprehensive and optimal management in aspects of labor, goods (machinery, equipment, and raw materials), or other production factors that can be used as products that are commonly traded
Operational management can also be interpreted as management (planning, organizing, directing, coordinating, and control) of all activities related to goods and services directly.
Another understanding is the application of management science to regulate all production activities to run effectively and efficiently. The definition of other experts is a continuous and effective process in using all management functions to integrate various resources efficiently for the realization of the company’s goals.
In operational management there are management structures that must be formed and implemented according to their respective functions. The highest leader in the system is operational manager.
Operational management goals
Operational management aims to regulate the use of all resources owned by the company (raw materials, labor, machinery, and equipment) so that the production process takes place effectively and efficiently. Here are five objectives of operational system details.
- Increase the efficiency of the company (efficiency).
- Increase the productivity of the company (productivity).
- Reducing the cost of expenses of various activities organized by the company (Economy).
- Improve the quality of the company (Quality).
- Reducing the production time of a company (Reduced Processing Time.
Characteristics of Operational Management
There are three characteristics or characteristics of operational management, namely:
1. Aim to produce goods and services
The first feature is that operational management aims to regulate the overall production process of goods and services to generate income for the company.
2. Having a transformation process activity
The transformation process is all activities or groups of activities that take one or more inputs, change and add value to them, and provide output for customers or clients.
If the input is raw material, it will be relatively easy to identify the transformation involved, such as when milk is converted into cheese and butter. But if where input is information or people, the transformation properties may be less clear. For example, hospitals change patients who are sick (input) become a healthy patient (output).
3. There is a mechanism for controlling an operation.
The last feature in operational management is a mechanism in controlling operating on a business. Both for the operation of the steps in the basic operating process must be applied to all business divisions, such as improving product quality, reducing waste, and increasing sales.
Its function on business
There are four operational management functions in businesses such as the following descriptions.
This stage includes all activities that begin from the determination of goods or services to be produced up to schedules for product marketing. Including planning the use of resources and other facilities to produce a product. As a operational manager must develop programs, policies, and procedures needed to achieve the objectives of the company’s operations.
You must specify the number and type of human resources needed to run all activities. In short, operational managers form individual structures, groups, or divisions in an operational subsystem to achieve company goals.
This stage includes all activities to obtain information about every activity that is done in operating and production activities.
The supervision function includes all activities aimed at directing and ensuring that various activities that have been and are worked in accordance with planning.
You have read and now understands operational management. The system is the most expensive part of a company. So, the efficiency and effectiveness of the operational system has a big impact on the company. The operational system plays a role in making a product according to the standard operating standards using an effective production process. Of course, the products produced are also able to fulfill diverse consumer desires.
After this you are expected to be able to apply the system so that the benefits obtained are more than before.
Another thing that needs to be encouraged in the company’s operations is with a transparent and efficient bookkeeping process. With the correct bookkeeping, all plans in business development will run optimally because all financial statements will be presented factually and according to reality.
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