What is Operational Management?
The management and monitoring of operations are crucial to the success of any organisational leader. Here we will explore what operations management is, as well as how you can manage and monitor it for sustained business performance. This course will introduce learners to the components of an operational plan, including how to use GANTT charts, McKinsey's 7S approach and RASI analyses. It also explores how to use contingency plans and follows what policies must be adhered to. Finally, it looks into the role of sales and marketing in operational planning.
Organisational strategic targets are the overall aims of the whole organisation. When implementing plans, the objectives and activities of each division, department, office, team and individual need to be aligned to support these aims. This is why operational management and planning is vital. It takes the overall organisational strategic targets and translates them into daily, weekly, monthly actions that moves the organisation closer to its longer-term goals.
Organisational targets could include things such as:
• increasing sales by 20% over two years
• reducing landfill waste by 40% over five years
• being the number one retailer in a specialist area – e.g. clothing, food or holidays
• having excellent customer feedback with at least 95% positive feedback from satisfaction surveys
• introducing new technology and having it tested and fully up and running within three months
• expanding the business into another country
• restructuring the business to make it more efficient and profitable
• working towards bidding for a large government contract
• recruiting and retaining the best staff in the industry
Each team will have a different input to the organisation to help it achieve its overall targets. For example: the sales and marketing team would be very involved with increasing sales, expanding into new markets and bidding for new contracts; the production team might be more closely involved with reducing waste and introducing new technology; the HR department would be closely involved with staff recruitment and retention.
Operational management and planning
Once the organisation has set its direction, the strategic goals and objectives will need to be broken down. This enables each part of the operation within the organisation to write its own plans in order to make its specific contribution to achieving the strategic goals.
These plans are called operational or business plans. Effective operational management is about the successful delivery of these plans. According to the online dictionary, operations management is defined as:
‘The design, execution and control of operations that convert resources into desired goods and services, and implement a company’s business strategy’
In this section we are going to look at:
• the key components of operational management
• the components of an operational plan
• the importance of contingency planning
• policies, processes and procedures that affect operational planning
• the links between business strategy and operational planning
• how sales and marketing plans contribute to operational plans