Managing and performing

Operations Management

“Management means, in the last analysis, the substitution of thought for brawn and muscle, of knowledge for folklore and tradition, and of cooperation for force.”

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- Peter Drucker

Introduction

Management is a challenge requiring knowledge and skills to adapt to new circumstances.

Four ongoing challenge that characterizer the current business landscape:

Globalization

Technological Change

Knowledge Management

Collaboration across Boundaries

Globalization

• Corporations operate worldwide, transcending national borders:

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• Companies that want to grow often need to tap international markets, where incomes are rising and demand is increasing.

Technological Change

• Why is the internet so important to business?

• It is a marketplace.
• A means for manufacturing goods and services.
• A distribution channel.
• An information service.
• It drives down costs and speeds up globalization.
• It improves efficiency of decision making.
• It facilitates design of new products from pharmaceuticals to financial services.
• Managers can watch and learn what other companies are doing on the other side of the world.
• Although the advantages create business opportunities.

Knowledge Management

• Is the set of practices aimed at discovering and harnessing an organization’s intellectual resources-fully using the intellects of the organization’s people.

Workers whose primary contributions are ideas and problem-solving expertise, are often referred to as:

Knowledge workers

Managing these workers poses some particular challenges for example determining whether they are doing a good job can be difficult because the manager cannot simply count or measure a knowledge worker’s output.

Collaboration across Boundaries

• One of the most important processes of knowledge management is to ensure that people in different parts of the organization collaborate effectively with one another.

“T-shaped” managers break out of the traditional corporate hierarchy to share knowledge freely across the organization while remaining committed to the bottom-line performance of their individual business units.

Competitive advantage has the most difficult topic with keep this advantage through the operation in the time. Managers must be concentrated also on:

1.- Innovation

2.- Quality

3.- Service

4.- Speed

5.- Cost

6.- Sustainability

Innovation

• The innovation is the introduction of new goods and services.

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• The firm must be ready with the new ways to communicate with customer and deliver the products to them.

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• The need for innovation is driven in part by globalization.

"In the future, the real competition will not be between companies or products, but between logistics processes."

- Michael Porter

Quality

• Quality is the excellence of your product.
• Total quality.
• Preventing defects before they occur.
• Achieving zero defects in manufacturing.
• Designing products for quality.

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• Quality is further provided when companies customize goods and services to the wishes of the individual consumer.

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The goal is to solve and eradicate from the beginning all quality-related problems and to live a philosophy of continuous improvement in the way the company operates.

Service

• Service means giving customers what they want or need, when they want it.

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• So service is focused on continually meeting the needs of customers to establish mutually beneficial long-term relationships.

An important dimension of service quality is making it easy and enjoyable for customers to experience a service or to buy and use products.

Speed

• Speed as a rapid execution, response, and delivery

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• Speed is no longer just a goal of some companies; it is a strategic imperative.
• Now the speed requirement has increased exponentially.�Everything, it seems, is on fast-forward.

• How fast can you develop and get a new product to market?

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• How quickly can you respond to customer requests?

Cost Competitiveness

• Keeping costs low enough so that the company can realize profits and price its products (good or services) at levels that are attractive to consumers.

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• One reason every company must worry about cost is that consumers can easily compare prices on the internet from thousands of competitors.

Money can be spent in thousands of ways and savings can come from the least imagined places.

Sustainability

• Is the effort to minimize the use and loss of resources, especially those that are polluting and nonrenewable.

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• Efforts to cut energy waste are just one way to achieve an important form of competitive advantage.

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The clashes among the rising demand for resources, limited supplies, and changing social attitudes toward environmental protection mean to have greater focus on resource productivity, the emergence of clean-tech industries, and regulation.

Don’t focus on one aspect of performance and neglect the others. You might be better at or more interested in one than others, but you should strive for all six.

The Functions of Management

The Functions of Management

• Management is the process of working with people and resources to accomplish organizational goals.

Good managers do those things both effectively and efficiently

Effective

Is to achieve organizational goals.

Efficient

Is to achieve goals with the minimal waste of resources –that is, to make the best possible use of money, time, materials and people.

Great executives not only adapt to changing conditions but also apply – fanatically, rigorously, consistently, and with discipline- the fundamental management principles

Organizing

Planning

Controlling

Leading

Planning: Delivering Strategic Value

• Planning is specifying the goals to be achieved and deciding in advance the appropriate actions needed to achieve those goals.

• Analyzing current situations.
• Anticipating the future.
• Determining objectives.
• Deciding in that types of activities the company will engage.
• Choosing corporate and business strategies.
• Determining the resources needed to achieve the�organization’s goals.

Planning: Delivering Strategic Value

• The better you meet those needs (in terms of quality, speed, efficiency and so on), the more value you deliver.

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• Now and in the future, delivering strategic value is a continual process in which people throughout the organization use their brains and the brains of customers, suppliers, and other stakeholders to identify opportunities to create, seize, strengthen, and sustain competitive advantage.

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Value is the monetary amount associated with how well a job, task, good, or service meets users’ needs.

That value is strategic when it contributes to meeting the organization’s goals.

Organizing: Building a Dynamic Organization

• Organizing is assembling and coordinating the human, financial, physical, informational and other resources needed to achieve goals.

• Attracting people to the organization.
• Specifying job responsibilities.
• Grouping job into work units.
• Marshaling and allocating resources.
• Creating conditions so that people and things work together �to achieve maximum success.

Organizing: Building a Dynamic Organization

• Effective managers will be using new forms of organizing and viewing their people as perhaps their most valuable resources.

They will build organizations that are flexible and adaptive, particularly in response to competitive threats and customer needs.

Leading: Mobilizing People

• Leading is stimulating people to be high performers.

• Motivating and communicating with employees, individually and in groups.
• Close day-to-day contact with people.
• Helping to guide and inspire them toward achieving team and organizational goals.

Leading takes place in teams, departments, and divisions as well as at the top of large organizations.

“The most valuable asset of a 21st- Century institution, whether business or non-business, will be its knowledge workers and their productivity”

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• Peter Drucker

“If you want to build a ship, don't drum up people to collect wood and don't assign them tasks and work, but rather teach them to long for the endless immensity of the sea.”

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• Antoine de Saint-Exupery

Leading: Mobilizing People

• Managers must be good at mobilizing people to contribute their ideas-to use their brains in ways never needed or dreamed of in the past.

Controlling: Learning and Changing.

• Controlling, monitors performance and implements necessary changes.

By controlling, managers can be sure about:

• The organization’s resources are being used as planned.
• The organization is meeting it goals such as quality and safety.

“What is not defined cannot be measured, what is not measured cannot be improved. What is not improved always degrades. ”

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William Thomson

1824 - 1907

Controlling: Learning and Changing.

• The controlling function makes sure that goals are met. It ask and answer the question:

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�The key managerial challenge are far more dynamic than in the past; they involve continually learning and changing.

Are our actual outcomes consistent with our goals?

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As a manager, your typical day will not be neatly divided into the four functions. You will be doing many things more or less simultaneously.

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Good managers don’t neglect any of the four management functions.

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Alice: I just wanted to ask you which way I ought to go.

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Cheshire Cat: Well, that depends on where you want to get to.

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Alice: Oh, it really doesn’t matter.

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Cheshire Cat: Then it really doesn’t matter which way you go!

Thank you