Operations management: business approach to success

So we had this great operations management class and I decided to share with you the learning process or something that seems utterly boring (sorry, seems so) and changing it into something... well, maybe not entirely fascinating, but at least useful in business.

What is operations management?

Operations help build effective environments. It is one of the keys to building effective environments that is part of the business strategy. In the IT sector operations management consists in maintaining the status quo of processes, improvements and rapid implementation to address any failures that may occur.

As they are versus as they should be

Operations currently focus on problem solving. The current complexity of the processes must be replaced by mainstreaming, cause operations are not a black box and are an important part of the strategy. In the approach to operational efficiency it is important to optimize resources, which, from the organizational approach, are production operations, logistics, purchasing, procurement, distribution, customer services etc. From the point of sale and management it is about increasing revenue through proper management of operations.

The approaches to the scope and objectives of the operations: famous trade offs

The trade offs are called sources of complexity.

When taking the operations management approach, we divide them into:

• Intra departmental: allow you to synchronize a set of activities, form the intelligence of the system. Here are three threads:
  

1. Sales planning to organize resources
   
2. Sales and Operations Planning (internal planning)
   
3. Collaborative planning
   

• Competitive variables: type of product
  
• Interdepartmental
  

Operating Hardware and Software 

Functional decisions have a specific type. While active policy we call the operating hardware, the management system is referred to as operating software. Although companies often overstate the "hard" to "soft", which is a priority and more important decisions are soft, as they focus on more difficult intangibles of being copied and therefore are part of the competitive advantage, and developing skills. However, they should always be accompanied with the right choice of hard, in line with corporate strategy, and be analyzed as a whole.

Tools for operational excellence

• Benchmarking - technique that replicates best practices competition. Although it serves for quick wins, it has important limitations, since copy is not the same as innovation.
  
• The balanced scorecard (scorecard) - measurement system financial results and customer satisfaction
  
• Lean techniques - aimed at improving process efficiency by eliminating non-value factors
  
• Total Quality Management - set of methodologies to ensure quality in the processes of the organization and promote culture which commits members to meet the objectives
  
• Six Sigma - advanced techniques of total quality, based on methodology focused on reducing process variability.
  
• SCOR -model sector analysis from the best practices of supply chains.
  

Types of effective leadership

To be a good leader, the manager must be versatile and adaptive, able to change roles according to the needs of your team. Furthermore, it should be transformative, focused on the market and with an attitude of constant improvement. An inclusive vision is needed to encompass all the projects to which it is faced. Should be able to ask and answer questions and delegate, not only tasks, but also the leadership itself when it senses that another person will be more efficient for a particular task.
The issue of delegation of leadership is especially important because it is often the key determinant of success in managing the team. How to delegate effectively and, at the same time not lose the status of the management role? The question of ego and fears are often the main problem in the management of teams, which is why the confidence and transparency in the company are so important.

Operations there are three types of leadership:

• Technical support - much technical knowledge and little leadership and management skills
  
• Intermediate - organizational approach
  
• Senior management - high management skills and little technical skills
  

Each is used according to the needs of the enterprise. A leader must also be combined with the integrated vision consistent with the personality, character of the organization, culture and values ​​and a good ability to influence on both, individual and collective side of the team.

Dilemma of the two companies

When comparing two different companies, which is better level of operations it will always be the one with a higher rate of rotation. When there is more rotation of products, it is more competitive, since it has more flexible responsiveness and less accumulation. The inventory is often a bottleneck for the company, so planning is as important - if not planned, supply and demand are not related, as the flexible response mechanisms are more expensive than the client is able to pay. And then whoops, a problem for the company.

Operational excellence as a business challenge

In managing the business operations there are several challenges. Flexible response is the first one. In the traditional world, it complies with intelligent management, value chain and managing expectations through promotions (do not forget that in this case the highest quality is closely linked with a higher cost, so the question of what accounts for the highest cost, in this respect, is crucial).
Operations management is a set of effective management: HR, of sets of activities, hard and soft decisions, operational excellence tools and trade offs. The efficiency lies in the continuous management via costs and income variables via differentiation, service, flexibility, competition variables through the strategy and market analysis.

To avoid mistakes, instead of looking at the operating costs, we must look at the costs of the market. Operations market always built back and not vice versa.

To all the questions we may have, the answeres shall be segmented according to the client's needs. If there is no strategy then be complex adaptive mechanisms used to answer customer needs. Decisions on revenues and costs are not taken only from the standpoint of operations, but have an impact on the operational outcome. When interdepartmental trade offs occur, the product margin expands, the cost and product life cycles shorten. These are precisely the interdepartmental trade offs and managed through the multi-departmental management processes and mainstreaming.

Adapting to market

As you change the market, it has to tune the operating model. If market changes, operations strategy must also change. The output in this aspect moved on product attributes, those that respond to a value proposition and competitive analysis. The market changes because the competition varies. The context may be turbulent. Variability has two causes: exogenous, which can not be controlled, and internal, which come within the company, such as promotion policies, the changes in product life cycle, etc. It is important to remember that when there is a clear focus, tactical decisions and operational focus on a short-term may destroy the long-term strategy.

Operations approaches:

Efficiency→ Target → Optimize Efficiency Resources
Competition → Target → Profitability Analysis
Supply Chain Management → Target → the value chain (as closer to the customer, more control the company has). Corporate strategy  must position the company within the chain - if the corporate strategy is not right, then not be able to achieve the objectives of improving effectiveness and efficiency
Business Model → Target → Development of competition in the case of malfunction and when other companies have managed to remove net interest income and have moved to product, the problem is that the business model has become obsolete. The brand has a huge capacity and long tail can sometimes endure for a while, but the change is needed in order to survive these conditions.

Competence Management

All companies have operations departments, the output is different, but have managed to develop a range of skills / abilities. A competency is the ability to do something that others are not able to do. Competition can be achieved through changes in management and processes: operations is an internal procedure.
Thus, the company, in the first step, you should choose the basic skills, which are classified according to the results expected of them:

The skills that facilitate anticipation of market needs

• Focus on the design of the operating system
  
• The decision to optimize the "hard" and "soft"
  
• Efficient executions of the company

1) Connection - learn to improve service, as each decision made other decisions reached
2) Time of strong development of competition - be able to serve the market quickly so that this business model can be made replicable - once the model can be replicated learn.

Troubleshooting

The correct troubleshooting process is essential. The complication arises when a company chooses a tactical response and this one is incompatible with the overall strategy. To avoid this, you need to be coherent and consistent.

• Understanding the problem
  
• Recognizing the problem
  
• Understanding the nature of the problem: for example, a rapid change means high risk, slow change is less painful and much less risky.
  

All these issues need to be viewed from a multidisciplinary perspective. 

In the next stage a series of processes shall be designed, projects or cross-cutting initiatives that eventually will result in in skills, then the distribution of power, which is what is giving resources is designed. The same building initiatives, the way the things are done must be consistent with the character of the organization and people who represent it.

In managing change should not touch the organization but to develop initiatives and assemble teams with a good management, to prepare the organization to develop initiatives. The message is to create work systems with a condition and communication protocols - R&D is responsible for managing the troops, marketing, finance, design is being performed to implement a bottom up structure.

Then they would have to go into the subject of prioritization of the indicators - priority is to make decisions back and forth - the value preposition from the point of view of the product. Which is the primary one? Which are the secondary ones? A good KPI stucture is not very, but extremely important.

Knowledge for the future

One of the most interesting questions we can ask is the application of acquired knowledge to sectors that have more potential for growth in the future. The issue of knowledge platforms and digital manufacturing seem more relevant. Learning platforms as Udacity, Coursera, Udemy or Edx already provide millions of people access to quality learning completely free, which will make the universities will have to go adjusting its model to provide added value on courses As of expertise. As for Digital Manufacturing, networks of 3D printers Do you really have to wait 10 years to get to the implementation of this innovation?
It has already arrived. 

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