Figure 1. Production variables and relationships among them

Date: 2015-10-07; view: 455.

Management and Production

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READING COMPREHENSION 1 (UNITS 1-2)

(From M. Menson. Management. New York, USA.)

Management and Production

In order to reach goals, all managers face the challenge of planning, organising, in­fluencing, and controlling to produce some type of product. Naturally, these products vary significantly from organisation to organisation. For example, it is the purpose of managers in automobile factories to produce cars, of managers in hospitals to produce healthy people, and of managers in universities to produce educated individuals.

Production is simply defined as the transformation of organisational resources into products. As used in this definition, organisational resources are all assets available to a manager to generate products; transformation is the set of steps necessary to change organisational resources into products; and products are various commodities aimed at meeting human needs. Figure 1 summarises what constitutes organisational re­sources, transformation and products as well as the relationships among them.

From this discussion it is easy to see the importance of management being continually aware of the status and use of organisational resources. These resources are of four basic types: (1) human resources, (2) monetary resources, (3) raw materials resources and (4) capital resources. Human resources are the people who work for an organisation. The skills they possess and their knowledge of the work system are in­valuable to managers. Monetary resources are amounts of money managers use to purchase goods and services for the organisation. Raw materials are ingredients ac­quired to be used directly in the manufacturing of products. For example, rubber is a raw material that a company like would purchase with its monetary resources and use directly in the manufacturing of tires. Lastly, capital resources are the machines an organisation uses during the manufacturing process. Modern ma­chines or equipment can be a major factor in maintaining desired production levels, while worn-out or antiquated machinery can make it impossible for an organisation to keep pace with competitors.

Operations Management

The process of managing production in organisations is commonly called operations management. Operations management can be defined as the per­formance of the managerial activities entailed in selecting, designing, operating, con­trolling, and updating productive systems. These activities can be categorised as being either periodic or continual. The distinction between periodic activities and continual activities is based upon the rela­tive frequency of the occurrence of each; periodic activities are performed from time to time and continual activities are essentially never ending. Although this list of ac­tivities is not meant to be exhaustive, their performance in the relative fre­quencies implied in Figure 2 will increase the probability of efforts in operations management being successful.