FOCUS ON OPERATIONS MANAGEMENT AND SUPPLY CHAIN TO GROW

Operations management and supply chain are key to running your business if you intend to make any profit.

What is supply chain?

A supply chain is a group of partners who collectively convert a basic commodity into a finished product that is valued by end-customers, and who manage returns at each stage.

This whole process works effectively if you know what operations management is because you will need inputs to process whatever you are going to offer the market.

Operation vs operational what is the difference?

When focusing on your business operations management and supply chain, it is important not to confuse the term “operations” with “operational”

Operational refers to short-term, day-to-day plans and action. It is the opposite of strategic or long-term plans and action.

Operations refers to the resources and processes that create and deliver products in order to meet customers’ requirements.

Your business operations function will be responsible for creating and delivering products which means your operations management aim will be to meet customer’s requirements but within minimum costs for the business

Operations management and supply chain in practice

In the airline sector, in-flight meals are an important part of service provided.

The issue is, the production of the food is mostly done by external suppliers who are tasked with provision of fresh, good quality and properly packaged food. The food should be supplied at the right place at the right time.

This is why you need to understand the supply chain because a number of things can go wrong.

For starters food is generally perishable and susceptible to high wastage and yet each unit has a cost, both for the airline and the in-flight catering supplier.

The cost will vary depending on the class, for instance economy of premium, in which it is served.

The airline will therefore need to give the suppliers relevant information days in advance, for example, how many passengers will be each class on each flight. Although most of the time the information is given about six hours in advance.

Operations management is important at this stage because this demand forecasting is not so easy.  Operations at this level can also be affected by other external factors, such as security concerns and flight delays.

The supplier’s location is therefore critical in this supply chain.

Conclusion

When it comes to operations management and supply chain remember this;

An organisation’s competitive advantage is not just determined by the excellence of some of its operations, but from successful management of the network that spans operations in the organisation as well as upstream operations (involving suppliers and suppliers’ suppliers), and downstream operations (involving customers and customers’ customers).

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