What is operations management? Effective operational management models

Operational management plays an important role in maintaining and developing an organization or business. This article will help you discover in detail what operational management is, along with effective operational management models that you can immediately apply to your business.

1. WHAT IS OPERATIONAL MANAGEMENT?

Operational Management is a process that helps businesses manage business structures and processes, and appropriately use organizational resources to optimize efficiency, effectiveness and increase profits. . It is a field of management devoted primarily to operating an organization's production and supply processes of products or services. Operations management involves managing the process of converting raw materials, labor, and energy into goods and services. People skills, creativity, sound analysis, and technological knowledge are all important for success in operations management.   

The main activities of operational management include:

• Forecasting product manufacturing capabilities
• Receive orders
• Determine the enterprise's production norms
• Business positioning
• Planning and layout of product production facilities
• Select production location
• Plan and allocate resources appropriately

2. EFFECTIVE OPERATIONAL MANAGEMENT MODELS

Currently, there are 4 effective operational management models, applied by many businesses: Lean Manufacturing, Six Sigma, Business Process Reengineering (BPR) and Production System Reconfigurable manufacturing system (RMS).

2.1. Lean Manufacturing - Lean Manufacturing

Lean manufacturing encompasses systematic improvement principles and tools that focus on creating value for customers and eliminating waste in an organization's production or service delivery processes. enterprise. This model believes that using resources for any reason other than creating value for customers is wasteful and seeks to eliminate this waste as much as possible. For that reason, Lean Manufacturing brings great benefits to businesses, including:

• Improve productivity, improve quality of products and services
• Optimize production time and service provision
• Minimize most waste
• Increase the ability to use equipment and premises

Lean Manufacturing - Lean Manufacturing

2.2. Six Sigma

Six Sigma is a methodology that focuses on quality by identifying and eliminating the causes of errors and minimizing variation in production and business processes. Tools commonly used in Six Sigma include trend charts, calculating potential defects, and other ratios.

DMAIC - Method of applying Six Sigma to businesses

• D - Define: In this step, it is necessary to determine the specific goals of the project and clearly identify factors related to quality. Deciding on the project and defining the business scope for implementing Sigma is an important step to take.
• M - Measure: This includes determining quality indicators, measuring important parameters, building current performance statistical charts to find the cause of errors. .
• A - Analyze: From the measurement results, the Sigma team has identified the root causes of errors and found solutions. Solutions must be rigorously tested and have backup plans
• I - Improve: Improvement measures can include changes in the production process, changes to the work process or improvements to the product's design.
• C - Control: Control measures need to be developed to ensure that the new process is stable and does not fall back into old process ruts.

DMAIC - SIX SIGMA

2.3. Business Process Reengineering (BPR)

Process reengineering (BPR) is a strategy that focuses on analyzing and designing workflow and business processes within a company. Its goal is to optimize costs, improve product and service quality and increase business development speed.

Basic operating principles of BPR:

• Determine the Process that needs to be redesigned
• Assemble a team of experts: Like any project, restructuring requires a team of highly skilled people making the right decisions.
• Find inefficient processes and identify key performance indicators
• Reengineer processes and compare KPIs: Once you've completed the analysis and planning, you start implementing small-scale changes and evaluating KPIs. If the results are good, you can begin to expand the scale and apply it to the company's activities.

Business Process Reengineering (BPR)

2.4. Reconfigurable manufacturing system (RMS)

Morphing manufacturing systems are designed to accommodate changes in architecture, hardware, and software. This allows systems to quickly adjust production capacity and operate effectively to suit changes in the market or the business's current system.

This system often uses technology and equipment with high automation capabilities, thereby minimizing the conversion time between products and services. By using RMS, organizations can increase agility and increase responsiveness, reduce waste, and increase overall performance.

One of the biggest advantages of RMS is its ability to quickly adapt to market and product changes, helping businesses maintain competitiveness in an increasingly changing business environment.

Reconfigurable manufacturing system - Reconfigurable manufacturing system

3. Best methods for operational management

The most effective methods of operations management are often modern methods that allow employees to complete their work efficiently to provide desired products and services to customers. However, management methods need to change and be suitable for different types of companies and in accordance with industry changes. Although there is no specific standard for effective operational management, companies Companies and organizations have found methods to improve management activities. Include:

• Apply effective technology

As automation grows and eliminates routine business processes, managers will optimize using data-driven design and engineering.

• Use data to decide

A modern operations management strategy focuses on making sound business decisions based on data-driven analysis rather than relying solely on past results, employee and customer behavior, and personal prejudices.

• Use models for business activities

Combining process redesign operational management models - BPR, Lean Manufacturing - Lean Manufacturing, Six Sigma, Transformative Manufacturing System - RMS.

Thus, through the article we have learned what operational management is and effective operational management models . If you are interested in solutions to help businesses manage operations effectively, don't miss 1C:Company Management 's manufacturing business management software from 1C Vietnam. Contact 1C Vietnam immediately for advice and more detailed information.