The relationship between operations management and business objectives

Operations Management

Area of the business that manages resources to achieve an efficient and effective output of goods and services

How effectiveness relates to operations management

The degree to which a business has achieved its objectives

How efficiency relates to operations management

How quickly and cheaply a businesses uses its resources to produce outputs

What do improvements in efficiency and effectiveness cause for a business

The business will have a competitive advantage over its competition

Productivity

The ratio of inputs used to create outputs

Examples of things that occur the more efficient and effective a businesses operations are, and how these things meet business objectives (5)

- Higher productivity - reduce expenses and increase profits
- Lower prices - increase market share and sales
- Higher quality - increase market share and sales
- Reduced waste - better meet shareholder expectations
- Producing in a more timely manner - fulfil market and social needs

Examples of things that occur the less efficient and effective a businesses operations are

- Poor quality products
- Slower production time
- Increased waste
- Lower productivity
- More expensive products