The Importance of Production and Operations Management

Operations Management, Importance of Production and Operations Management

Operations Management:

Operations Management is concerned with planning, organizing, directing and controlling the various Business Operations involved in the organization. 

Management divides four crucial functional areas: Financial Management, Human Resource Management, Marketing Management, and Production or Operations Management.

Production and Operations Management simply means to manage various Business Operations like Production operations, Supply Chain operations etc.

Production process passes from three stages:

1. Input,
2. Process,
3. Output

Every input has to pass from some stages to become final output. The input could be, raw materials or semi-finished product. Semi-finished products need some process to become the final product. 

The product process varies from the company to company. It depends on the type of the product that how much time will production process consume. Production and Operations Department plays a very crucial role. Here's the importance of Production and Operations Management :

1. Supports other functional areas:

Production and Operations Management support other functional areas of management such as marketing, human resource, and finance. Mainly there are four functional areas of management including Production Management.

2. Optimum use of resources:

Due to production management, there will be effective utilization of available resources such as manpower, raw materials, machinery etc. In the first step of the production process, there will be the input of available resources.

3. Reduces the cost of Production:

Production or Operations Management helps in reducing the cost of the product by reducing inputs and increasing outputs or results. So, it helps the company in cost reduction and increasing productivity.

4. Helps to introduce new products:

Production management conducts research and development (R&D) and develops new products with better quality and features. Research & Development department also tries to innovate the new product with unique features.

5. Achievement of the firm's objectives:

Operations management helps the organization in achieving its mission and vision. It helps in achieving sales targets by the marketing department by satisfying the needs and wants of the customers.


Now, we can say that the production process plays a crucial role in achieving organizational goals. Every business has different Business Operations. So, the above mentioned are some Importance of Production and Operations Management.

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The Importance of Production and Operations Management The Importance of Production and Operations Management Reviewed by Bhavik Chhuchha on November 24, 2018 Rating: 5

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