Operations Management: Supply Chain Management
Operations Management: Supply Chain Management
Operations and Supply Chain Management (OSCM), covers a wide range of activities that cover both manufacturing and service industries. It includes functions such as sourcing, materials management and distribution planning. Logistics, supply chain management, retail, demand forecasting and order fulfillment.
These roles and processes are distinct, despite some similarities. Business professionals must understand how supply chain management and operation management are used to improve efficiency and value and ultimately increase profits.
Supply chain management and operations management are essential for many industries, regardless of whether they are moving products, raw materials or money to their customers.
These roles can overlap in smaller organisations. If the skillsets for each role are similar, it is possible to have them both fulfilled by one person or a single department.
What is the difference between Supply Chain Management and Operations Management?
The main difference between supply chain management (or operations management) is that supply chains are primarily concerned with the outside of the company, such as acquiring materials or delivering products. Operations management, on the other hand, is focused on what happens within the company.
The supply chain manager will spend time negotiating and evaluating suppliers while the operations manager plans and oversees daily operations. Although supply chain management activities are similar across industries, the roles and responsibilities of the operations manager can differ depending on the product or services they provide.
What is Operations Management?
Operation management is about running a business efficiently and effectively. This includes material planning, maintenance, and analysis of production systems. Operations managers manage the internal business operations. They are responsible for how products and services are developed. These professionals must be skilled at building relationships with stakeholders and tech-savvy.
Operation management is the business function responsible to design and manage products, processes and supply chains.
Some of the most common responsibilities are:
- Coordinating production, pricing, sales or distribution
- Management of finance activities, including sales and other data.
- Evaluation of performance data for the purpose of making appropriate decisions about productivity, cost control and improvement
- Management of staff and work schedules. Assigning specific tasks.
- Coordinating and directing budget activities
- Forecasts of customer demand are used to determine the products that will be sold.
Operations managers may be responsible for managing the day-to-day operations of an entire company or a particular part of the production line, depending on their size. Operations is more focused on the company than supply chain. Operation managers are responsible for key decisions regarding design, production planning, workflow, staffing, and planning.
Operation managers must also be knowledgeable about the latest trends in operations management, such as Agile and Lean concepts that help reduce waste and increase efficiency.
What is Supply Chain Management?
Supply chain management refers to the management of the flow and quality of goods and services. It includes all the processes that convert raw materials into final products. It is the process of streamlining supply-side activities in order to maximise customer value and achieve a competitive advantage on the market.
Supply chain managers are more likely to work with customers than operations managers. Supply chain managers must be able to work with customers, suppliers and logistics in today’s global marketplace. They coordinate purchasing, warehousing and forecasting.
The duties of a Supply Chain Manager may include:
- Forecasting the demand for products or materials
- To ensure that raw materials are always available, you need to create supply plans
- Evaluation of suppliers and determination of the effectiveness multiple supplier strategies
- Assessing supply chain risks and troubleshooting problems in the chain.
- Analysing inventory data can help you increase inventory turnovers, decrease waste or optimise customer service.
What is the importance of supply chain management?
Because it can help you achieve many business goals, supply chain management is essential. Controlling manufacturing processes can help improve product quality and reduce the risk of lawsuits. It also helps to build a strong consumer reputation. Controlling shipping processes can also improve customer service by preventing costly shortages and periods of oversupply. Supply chain management offers many opportunities for companies to increase their profit margins. It is particularly important for large companies and multinational companies.
The management of supply chain includes the collection and manufacture of materials as well as the delivery of the products to the customer. Supply chain managers work closely with customers, suppliers, and logistics teams to manage the supply chain. They often work globally, overseeing purchasing orders, warehouses, forecasting, and monitoring suppliers.
Businesses need to manage their supply chain. It can reduce costs by sourcing more efficiently and have fewer inventories. Customers will be treated better and faster, and they can also respond to market demand and innovation faster. It provides assurance that every aspect of production is managed by the company.
Operations management and supply chain management will both add value to the business by supporting more efficient processes and driving greater revenue. The two roles are interdependent in pursuit of these objectives. The supply chain management manages the production process. Operations management would not supervise the product. For more information on Supply chain training contact our team.