Operations management focuses on carefully managing the processes to produce and

distribute products and services. Major, overall activities often include product creation,
development, production and distribution. (These activities are also associated with Product
and Service Management.) Related activities include managing purchases, inventory control,
quality control, storage, logistics and evaluations of processes. A great deal of focus is on
efficiency and effectiveness of processes. Therefore, operations management often includes
substantial measurement and analysis of internal processes. Ultimately, the nature of how
operations management is carried out in an organization depends very much on the nature of
the products or services in the organization, for example, on retail, manufacturing or
wholesale.

Operations management is an area of management concerned with designing, and controlling

the process of production and redesigning business operations in the production of goods or
services. It involves the responsibility of ensuring that business operations are efficient in
terms of using as few resources as needed and effective in terms of meeting customer
requirements. It is concerned with managing the process that converts inputs (in the forms of
raw materials, labor, and energy) into outputs (in the form of goods and/or services).[1] The
relationship of operations management to senior management in commercial contexts can be
compared to the relationship of line officers to highest-level senior officers in military science.
The highest-level officers shape the strategy and revise it over time, while the line officers
make tactical decisions in support of carrying out the strategy. In business as in military
affairs, the boundaries between levels are not always distinct; tactical information
dynamically informs strategy, and individual people often move between roles over time.

Ford Motor car assembly line: the classical example of a manufacturing production system.

Post office queue. Operations management studies both manufacturing and services.
According to the United States Department of Education, operations management is the field
concerned with managing and directing the physical and/or technical functions of a firm or
organization, particularly those relating to development, production, and manufacturing.
Operations management programs typically include instruction in principles of general
management, manufacturing and production systems, factory management, equipment
maintenance management, production control, industrial labor relations and skilled trades
supervision, strategic manufacturing policy, systems analysis, productivity analysis and cost
control, and materials planning.[2][3] Management, including operations management, is like
engineering in that it blends art with applied science. People skills, creativity, rational
analysis, and knowledge of technology are all required for success.

What are the differences between corporate strategy, business strategy, and operational
strategy?
Amongst all these strategies, business strategy is the essence of a business, and the other
two strategies inflate the effect of this essence. In other words, a business strategy defines
what creates value? whereas the latter two build and support the channel, which allows
value to flow from the creator to the consumer.
The core competencies of a firm define the basis of the BUSINESS STRATEGY of that firm. The
business strategy prescribes a precise method of creating value and monetizing that value. It
describes the way firm will exploit its core competencies and employ its competitive strengths
in creating VALUE, viz. by producing a good, a service or a combination of both.

The management practices, organizational policies,external-relationships (either with a

customer, a supplier or a competitor), and the capital structure of the firm shape the
CORPORATE STRATEGY of a firm. The corporate strategy focuses on adding value over and
above the value that the execution of the business strategy brings alone. It focuses on
providing the structural foundation that helps the firm in meeting its business objectives.
When the firm has zeroed down on what value it will create? Then it focuses on how to build
that value and deliver it? which is nothing but the OPERATIONS STRATEGY of the firm. Its the
practical version of establishing the 'value' imagined during the business strategy formulation.
Broadly it involves sourcing of raw materials or the feed, processing to make the final product
and delivering the product or the service to the customer/consumer. Its an extremely detailed
approach and includes an extensive list of activities, and decisions that vary from scenario to
scenario.
In few cases, a firm creates great value even by delivering a regular commodity product or
service (of vanilla variety) with the help of right operations strategy, which turns out to be the
core-competency of that firm.

Corporate Strategy: This deals with how business such as yours are organized. Where do you
fit in with other businesses in your particular industry. This will help you understand how you
should compete.
Business Strategy: Here you are focused on your end goal as a business. You are not worried
about other firms in your industry. This is where you decided what you will do next, if you will
add another product or service.
Operational Strategy: This is HOW you will function your day to day operation. Who does what
and when things need to be done. This is the base, the methodology.
So you can see why I would order it like this, its an easy way to see how your decisions
become more and more focused.

# What is Corporate Strategy?

Corporate strategy provides the guidelines for the businesses to achieve their long term
objectives. When developing a corporate strategy, it is essential to determine the purpose
and the scope of the organizational activities. Then about the nature of its business by
considering the environment in which it operates, its marketplace position and the level of
competition it faces.
Corporate strategy is created based on the vision of the organization. This is the most
important level of strategy since it is heavily influenced by the investors in the business
activities and acts to guide strategic decision-making throughout the business. Corporate
strategy is verbally expressed in the company mission statement. Usually, in every
organization the top management is responsible for establishing the corporate strategy.

Lean manufacturing or lean production, often simply "lean", is a systematic method

for the elimination of waste ("Muda") within a manufacturing system. Lean also takes into
account waste created through overburden ("Muri") and waste created through unevenness in
work loads ("Mura"). Working from the perspective of the client who consumes a product or
service, "value" is any action or process that a customer would be willing to pay for.
Essentially, lean is centered on making obvious what adds value by reducing everything else.
Lean manufacturing is a management philosophy derived mostly from the Toyota Production
System (TPS) (hence the term Toyotism is also prevalent) and identified as "lean" only in the
1990s.[1][2] TPS is renowned for its focus on reduction of the original Toyota seven wastes to
improve overall customer value, but there are varying perspectives on how this is best
achieved. The steady growth of Toyota, from a small company to the world's largest
automaker,[3] has focused attention on how it has achieved this success.

Lean manufacturing includes a set of principles that lean thinkers use to achieve
improvements in productivity, quality, and lead-time by eliminating waste through kaizen.
Kaizen is a Japanese word that essentially means "change for the better" or "good
change."
The goal is to provide the customer with a defect free product or service when it is
needed and in the quantity it is needed.
There are many tools and concepts that lean companies employ to support the above
principles and eliminate waste. Here are 12 of the most critical ones for you to know:
#1: Cellular Manufacturing
Cellular manufacturing is an approach in which all equipment and workstations are
arranged based on a group of different processes located in close proximity to
manufacture a group of similar products. The primary purpose of cellular manufacturing is
to reduce cycle time and inventories to meet market response times.
#2: Takt Time

This is the "heartbeat" of the customer. Takt time is the average rate at which a company
must produce a product or execute transactions based on the customer's requirements
and available working time.
Takt = T/D
Where T is Time available for product/service.
D is a demand for the number of units
T gives information on production pace or units per hours.
#3: Standardized Work
A process of documented description of methods, materials, tools, and processing times
required to meet takt time for any given job. This aids in standardizing the tasks
throughout the value stream.
#4: One Piece Flow or Continuous Flow
This concept emphasises reducing the batch size in order to eliminate system constraints.
A methodology by which a product or information is produced by moving at a consistent
pace from one value-added processing step to the next with no delays in between.
#5: Pull Systems and Kanban
A methodology by which a customer process signals a supplying process to produce a
product or information or deliver product/information when it is needed. Kanban is the
signals used within a pull system through scheduling combined with travelling instruction
by simple visual devices like cards or containers.
#6: Five Why's
A thought process by which the question "why" is asked repeatedly to get to the root
cause of a problem.
#7: Quick Changeover / SMED
A 3-stage methodology developed by Shigeo Shingo that reduces the time to changeover
a machine by externalizing and streamlining steps. Shorter changeover times are used to
reduce batch sizes and produce just-in-time. This concept aids in reducing the setup time
to improve flexibility and responsiveness to customer changes.
#8: Mistake Proofing / Poka Yoke
A methodology that prevents an operator from making an error by incorporating
preventive in-built responsiveness within the design of product or production process.
#9: Heijunka / Leveling the Workload
The idea that, although customer order patterns may be quite variable, all of our
processes should build consistent quantities of work over time (day to day, hour to hour).
This strategy is adopted by intelligently planning different product mix , and its volumes
over period of times.
#10: Total Productive Maintenance (TPM)

A team-based system for improving Overall Equipment Effectiveness (OEE), which

includes availability, performance, and quality. This aids in establishing a strategy for
creating employee ownership autonomously for maintenance of equipment. The goal of
the TPM program is to markedly increase production while at the same time increasing
employee morale and job satisfaction.
OEE ( Overall Equipment Efficiency ) :
OEE = A x PE x Q
A - Availability of the machine.. PE - Performance Efficiency. Q - Refers to quality rate.
#11: Five S
5S is a five step methodology aimed at creating and maintaining an organized visual
workplace.
This system aids in organizing , cleaning , developing , and sustaining a productive work
environment.
#12: Problem Solving / PDCA / PDSA
The PDCA cycle is a graphical and logical representation of how most individuals have
already solved problems. It helps to think that every activity and job is part of a process,
that each stage has a customer and that the improvement cycle will send a superior
product or service to the final customer.
PLAN: establish a plan to achieve a goal
DO: enact the plan
CHECK: measure and analyze the results
ACT: implement necessary reforms if results are not as expected
A system for identifying and solving problems to their root cause and then implementing
counter measures with monitoring.