“Operation function” is a core, probably the core, responsibility of upper management of an organization. To the extent that a single individual or office is responsible for the management of an entire business enterprise, this is it. Operations management is responsible for the visualization of strategy and a key function of operations management is the realization of that strategy through planning and oversight of each phase of a manufacturing and distribution process.
That planning and oversight includes verification that budget figures balance or, if calculated, that anticipated (presumably short term) deficits are accounted for with the anticipation of a balance at the end of the organization’s fiscal year. That means that careful—almost to the point of prescience with respect to market conditions months or years down the road—consideration has to be given to possible changes in the environment in which the business in question is operating. No business could have anticipated the global economic meltdown that we are currently experiencing due to the rapid spread of a virus.
In addition to budgetary considerations, operation functions include planning and oversight of the actual manufacturing and distribution processes. This is the real heart of the issue and the reason those vested with responsibility for operations management sit at or near the top of the organizational chart. We are talking about processes that involve everything from planning each step of the manufacturing and distribution processes, what materials need to be purchased from other businesses or vendors, and how costs associated with those acquisitions might be accurately determined.
While contracts (excluding the kind of “cost-plus” contracting routine among government agencies in which unanticipated increases in material and labor costs are calculated into the final numbers) lock in the dollar amounts, obstacles can arise, such as disruptions to shipping and storage capabilities (e.g., labor strife, natural disasters that close down ports of entry/exit, warehouse fires or floods, etc.). Operations functions include management of the movement of material and manufactured goods through the organization and, once the finished product is palleted and awaiting distribution to customers, management of that final process. Ensuring that the right product in the right quantity and at the expected quality are transported to customers is obviously an essential part of the process, and one executed by individuals far down the line.
“Operations function” represents a vast category of business activity. Those responsible must be cognizant of changes in the market and developments in the designing and manufacturing of goods and services. Failure to implement needed changes in a timely manner, such as plant recapitalization and upgrades of software programs, can result in lost business.