Chapter 6 operations management functions
Operation management- management of resources to achieve efficient output of goods and services
Capacity planning- operations decision concerned with the quantity of goods or services to be produced
Capacity- volume or potential ability to produce a certain amount of product
Operations- a series of procedures and processes undertaken in order to create outputs
Outputs- transformed inputs that are returned to the external environment as products or services
Transformation- the process involved in converting inputs into outputs
Inputs- resources such as raw materials, labor, plant, equipment, capital, information used in any organizational production system
Production process- the process of transforming resources inputs into finished goods and services
Productivity- a measure of the functioning of a production system, the level of output obtained from the set level of input
Competitive advantage- a point of different or superiority held over one’s competitive
Equipment- machinery and other tools
Facilities- capital items that facilitate or assist production
Downtime- period during which production is not occurring

Good operations management is vital to the achievement of organizational objectives. Operation refers to the actual work done in transforming inputs and thereby preparing and delivering goods and or services for sale.
Operations and business objectives
In any org whether it is a manufacturer of goods or a provider of services, all department will function with the aim of improving the competitiveness of that org.
There has been change in the name of production management to operations management because of the decrease in the relative important of manufacturing to Australia economy, the focus on pure production has changed.
The operation system
The core of every org is the creation of the goods and services it offers to its customers\clients. Every org whether it produces goods or services has an operations system.
Operation system refers to the series of procedures and processes an org undertake in order to create its outputs of finished goods and services through transformation of inputs. The production process is the process of transforming resources inputs into finished goods and services
Key elements of the operations system
Input- to an operation system is like the ingredients that when mixed together and processed will become a finished product.
Raw materials and components- raw materials are unprocessed inputs sourced from primary producers. Components are processed parts usually purchased from another producer.
Human resources- labor is the human effort expended in a production process. Human resources are employed by orgs to oversee and enact the operations processes that create the output.
Technology- includes s computerization and new development that could potentially improve the efficiency and or effectives of an operations process.
Capital, plant and equipment- capital refers to any human made objects, tool or machine that assists in the production process. Cash can be classified as capital as it can be converted into necessary capital items. Plant refers to building and non-moveable capital items, while equipment refers to machinery and other tools such as vehicles.
Information and knowledge-this is specialized knowledge required in order to enact the production\operations system and to produce the specified goods and services. Knowledge in the form of data or information may also be obtained from a source external to the org.
Time- is a non-renewable resource that, if wasted will add to production costs

The transformation process
This involves the transformation of inputs into finished outputs. The operation process and system will vary according to the type of goods and services being produced, size of the org and number, quality and availability of resources.
Output
They are the final product or the