Operations Management

Operations Management

In any business whether it is large or small, a car company or a hospital there must be some type of organization that keeps the business going. Obviously without organization there would be chaos all over. Operations Management is a big part keeping things organized and flowing correctly. Operation Management is the management of that part of an organization that is responsible for producing good and/or services, according to William J. Stevenson.(Chapter 1) Recognizing the importance of operations management and knowing how it works among society today, is the key to learning what it is. Business organizations typically have three basic functional areas which are finance, marketing, and operations.

Finance department is responsible for ensuring financial resources at good agreeable prices and distributing those resources throughout the organization. This would include budgeting, analyzing investment propositions and providing funds for operations. Marketing department would be responsible for assessing consumer wants and needs, selling and promoting the organization’s goods and services. Operations department is mostly responsible for producing the goods or providing the services offered by the organization. (Stevenson, 2005)

Noticing what is a good and what is a service is important in order to know just how much operations management affects our daily life. A good example would be to imagine a person going for an oil change and receives Pennzoil in his motor. The service here would be the manual labor part of the oil change and the good would be the brand of oil that was received; Pennzoil. So, to define the production of a good would be anything that a person can touch. Services are how the good is delivered to the consumer.

Transforming or converting inputs into outputs takes part in the creation of goods and services. Examples of inputs in health care would be a patient going to see a physician, nurse, or therapist. Processing from these health care providers would be the examination, or evaluation performed. Output would be a sick patient now given therapy or being prescribed something to make him/her feel better. Certain measurements must be taken at different points in the previously established standards to ensure that the desired outputs are obtained, and to decide whether curative action will be needed. Goods and services can stick together pretty well, though there are some differences that separate the two. The difference would be determining which one impacts the management of goods portion and which one impacts management of the service portion.

Importance of operations management in health care has a lot to do with the services and goods provided in a health care facility. If a patient is going to a physicians’ office because he/she is having a lot of headaches and auras in his/her vision, the physician would send the patient to a clinic with a lab or hospital