Operations Management: An Integrated Approach, 5th Edition

WHAT IS OPERATIONS MANAGEMENT?

Every business is managed through three major functions: finance, marketing, and operations management. Figure 1-1 illustrates this by showing that the vice presidents of each of these functions report directly to the president or CEO of the company. Other business functions—such as accounting, purchasing, human resources, and engineering—support these three major functions. Finance is the function responsible for managing cash flow, current assets, and capital investments. Marketing is responsible for sales, generating customer demand, and understanding customer wants and needs. Most of us have some idea of what finance and marketing are about, but what does operations management do?

FIGURE 1-1 Organizational chart showing the three major business functions

Operations management (OM) is the business function that plans, organizes, coordinates, and controls the resources needed to produce a company's goods and services. Operations management is a management function. It involves managing people, equipment, technology, information, and many other resources. Operations management is the central core function of every company. This is true whether the company ...