What is Operations Management?

If you want to be successful in business, knowing the basics of operations management is essential. Operations management focuses on how businesses produce goods and services while meeting customer needs and expectations. The core areas of operations management cover activities such as planning, directing, coordinating, executing, monitoring, and controlling processes to ensure efficiency. 

By understanding what operations management is and why it's important, you'll be better prepared to make decisions related to running a business or working as an operations manager at a company. Continue reading to learn about the valuable, in-demand skills of operations management.  

Operations management (OM) refers to the process of designing, planning, executing, and controlling the production of goods and services, along with managing the supply chain, inventory, and quality control. Operations managers play a critical role by ensuring that an organization's resources are used optimally to achieve set objectives. By leveraging the latest technologies and industry best practices, these professionals can drive innovation, improve productivity, and ultimately ensure that the organization is profitable and thriving in the long run. 

Businesses generally use two approaches in management: operations management and project management. Operations management focuses on the ongoing activities required to keep a business running smoothly, while project management focuses on the planning, execution, and controlling of specific projects. The key difference between these two approaches lies in their focus. Operations management is concerned with optimizing preexisting systems and processes, whereas project management is concerned with delivering a specific set of tasks or objectives with a defined timeline. Without effective management as a whole, an organization is likely to experience delays, inefficiencies, and even incur significant costs.  

Operations management plays a vital role in shaping an organization. By keeping a keen eye on production levels, quality control, and customer satisfaction, operations managers can create a reputation for excellence. This attention to detail builds trust and confidence among consumers and stakeholders. Additionally, employee motivation is critical to a company's success, and one area that has a direct impact on employee motivation is operations management. This is because effective operations management ensures that employees have the necessary resources and support to perform their job duties efficiently, which in turn can boost their motivation and job satisfaction. Specifically, when employees feel respected and valued by their organization, are given clear expectations, have access to relevant training, and are empowered to make decisions, they tend to be more engaged and motivated at work. 

Through effective operations management, organizations can establish themselves as reliable, efficient, and trustworthy, leading to increased customer loyalty, improved sales, and a positive brand image. All in all, operations management is the backbone of any successful business and can significantly impact its reputation.    

"Operations strategy" refers to businesses' plans and tactics to optimize their operations and production. It is the art and science of tailoring an organization's resources and capabilities to effectively and efficiently achieve its goals. At its core, operations strategy involves making a series of trade-offs between cost, quality, speed, flexibility, and innovation.  

The following are a few common operations strategies:  

• Product strategy is the overall game plan for designing, developing, and marketing a product. It considers the needs and wants of the target market, the competition, and the company's strengths and weaknesses. Product strategy aims to create a unique selling proposition (USP) that will give the company a competitive advantage in the marketplace. 
• Pricing strategy is the process of determining how much to charge for a product or service. It considers the perceived value of the product or service, the prices of the competition, and the company's production and marketing costs. The goal of pricing strategy is usually to set prices that will maximize profits while remaining competitive in the marketplace. 
• Distribution strategy is deciding how and where to sell a product or service. Similar to product strategy, it considers the target market, the competition, and the company's strengths and weaknesses. The distribution strategy aims to choose channels that will reach the target market efficiently and effectively. 
• Marketing strategy is the process of planning and executing marketing activities to promote a product or service. Like distribution strategy, it also considers the target market, the competition, and the company's strengths and weaknesses. Marketing strategy aims to create awareness and demand for the product or service to generate sales. 
• Sales strategy is the process of planning and executing activities to generate sales. It considers the same key factors: market, competition, and a company's strengths and weaknesses. Sales strategy aims to increase revenue by selling more products or services. 

Overall, operations strategy is critical to business success and requires careful analysis and execution to achieve optimal results. 

Operations management demands a variety of skills, most notably: 

• Communication: Operations managers must be able to communicate effectively with members of their team and with other departments within the company. They need to clearly articulate their project vision and ensure that everyone involved is on the same page. 
• Organization: Operations managers should be highly organized, as they coordinate many moving parts. They need to be able to create and maintain detailed schedules and plans and track progress against those plans. 
• Analysis: Operations managers must be analytical to identify problems and inefficiencies within their departments. They need to be able to collect, analyze, and use data to make decisions about improving processes. 
• Problem-solving: Operations managers must be excellent problem-solvers to identify and solve department issues. They need to assess the situation and develop an effective solution quickly. 
• Decision-making: Operations managers need to be able to make quick decisions to keep projects on track. They must weigh the pros and cons of their options, consider various perspectives, and make the best decision for the company.
• Strategic thinking: Operations managers must be strategic thinkers in order to develop long-term department plans. They need to be able to see the big picture and identify opportunities for improvement. 
• Leadership: Operations managers should possess strong leadership skills to motivate and inspire their team members. They need to be able to set clear goals and provide guidance on how those goals can be achieved. 

Operations managers are responsible for overseeing and coordinating an organization's day-to-day activities. They act as the bridge between different departments, ensuring that everyone is aligned with the company's goals and objectives. A good operations manager can inspire and motivate team members toward a shared goal. 

Operations management roles exist in various industries, including manufacturing, healthcare, finance, and logistics. With the ever-increasing demand for streamlining business processes, a career in operations management is rewarding and has promising career prospects. As the global economy becomes more complex, businesses need skilled individuals who can manage operations to increase efficiency and profitability. 

If you’re looking to pursue a career as an operations manager, consider these key steps. First, you should gain experience and knowledge in relevant fields such as logistics, supply chain management, and production. This can be achieved by seeking out internships or entry-level positions in relevant industries and by pursuing educational qualifications in the form of degrees or certifications. 

A few degree paths that are ideal for operations management include: 

• Bachelor’s degree in supply chain and operations management: This degree focuses on training students in the skills and knowledge necessary to successfully oversee the production and distribution of goods and services. Coursework typically covers topics such as inventory control, logistics, quality management, and supply chain strategy, all of which are directly applicable to operations management. By obtaining a strong understanding of these concepts, graduates are equipped to manage complex logistical challenges, reduce costs, streamline processes, and ultimately drive the success of an organization.
• Bachelor's degree in business management: This degree provides the foundational knowledge and skills necessary to manage business operations effectively. With a focus on finance, marketing, and strategic planning, you'll gain a well-rounded understanding of business fundamentals. Additionally, many business management programs (including WGU) offer courses specifically tailored to operations management, enabling you to dive deeper into this area of focus.  
• MBA degree: This degree offers an extensive curriculum focusing on essential business functions like finance, organizational behavior, and marketing. It also provides an in-depth understanding of supply chain management, logistics, and production methodologies. MBA graduates are able to develop strategies that can lead to increased efficiency, reduced waste, and enhanced profitability in operations. 
• Master's degree in management and leadership: Pursuing a master's degree in management would equip you with broad skills and methodologies, including strategic thinking, problem-solving, and decision-making. These competencies help managers to lead and optimize operations, minimize costs, and maximize efficiency. They can also help streamline processes and reduce errors, enabling managers to facilitate smooth operations and make impactful decisions. 

Additionally, it can be helpful to seek out mentors or industry professionals who can offer guidance and advice on succeeding in this challenging but rewarding role. Finally, it’s essential to cultivate excellent communication, leadership, and problem-solving skills, as these will be critical to your success as an operations manager. By taking these steps, you can set yourself on the path to a successful career in operations management. 

Having the right education and skills for operations management is essential for any operations manager looking to make changes that add lasting value and benefit to their business or organization. If you want to further your education but need the flexibility to learn on your own schedule, then consider WGU's programs. With courses available online at your own pace, these programs offer an excellent opportunity to build marketable skills while getting the credentials you need to advance your career in operations management.