PROJECT REPORT
A STUDY ON OPERATION MANAGEMENTAtHCL INFOSYSTEMS LTD.NOIDA
Submitted towards partial fulfillment of theRequirements for the
award of thePGDM Programme Approved by AICTE(Equivalent to
MBA)ACADEMIC SESSION
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Submitted to :- Submitted by:-
Table of ContentsAcknowledgment51.INTRODUCTION71.1.HCL an
overview71.2.HCL DNA:121.3.Employer spotlight:13HCL in
India:141.4.About HCL151.6.VISION STATEMENT161.7.MISSION
STATEMENT161.8.QUALITY POLICY STATEMENT161.9.OUR OBJECTIVE17OUR
MANAGEMENT OBJECTIVE17OUR PEOPLE OBJECTIVE171.10.CORE
VALUES171.11.A SNAPSHOT OF HCL Infosystems Ltd.18FRONTLINE
DIVISION192.Literature Review20Four Types of Focus Dimensions Used
in Operations Management20Finance20Customers20Internal
Processes21Learning and Innovation212.1.An Introduction of
Operation Management452.1.1.What is Operation
management?452.1.2.Why is it important?452.1.3.Critical factors for
success462.1.4.Who is involved?462.1.5.Principles462.1.6.Managing
for results472.2.Levels of Operation management472.3.Value for
money482.4.Measures and metrics492.4.1.Business processes can be
distinguished by:492.5.Processes502.6.Objectives of a Operation
Management System542.7.Overall Goal and Focus of Operation
Management552.8.Operation Improvement of the Organization or a
Subsystem is an Integrated Process552.9.Ongoing Activities of
Operation Management552.10.Basic Steps562.11.Operation management
mainly include following
things:582.11.1.Planning592.11.2.Monitoring602.11.3.Developing
Employees602.11.4.Rating612.11.5.Rewarding612.12.Managing Operation
Effectively622.13.Features of a Good Operation Management
System622.13.1.Competency-Based632.13.2.A Continuous
Process642.13.3.Operation planning652.13.4.Continuous coaching and
development652.13.5.Interim review662.13.6.Operation
appraisal672.13.7.To maintain an open
system673.PROJECT693.1.Objective of the Project Introduction of the
Problem693.1.1.Secondary objective693.2.Significance of the
Project693.3.Definition - A Theoretical
Perspective703.4.Preparation and Planning for Operation
management713.5.Operation Management and Development713.6.Operation
Assessment and Development Plan In HCL INFOSYSTEMS
LTD.723.6.1.Prior to filling the form please read carefully
Instructions to the Appraiser723.6.2.Operation appraisal
guidelines723.6.2.1.Appraisal procedure723.6.2.2.The Form And Its
Contents734.RESEARCH METHODOLOGY76Introduction77What approach
should I take - qualitative or quantitative?77Can my dissertation
be entirely literature-based?79What is case study research?80What's
an empirical study?80What is secondary analysis?81Where do I find
existing research data?81Collecting you own data - primary
research81Will my research be inductive or deductive?85What's all
this about research design?85Summary86Key Questions874.1.Research
Design894.2.Data Collection Method904.3.Analysis of PMS Processes
&
Components914.3.1.Planning914.3.2.Monitoring924.3.3.Developing
Employees934.3.4.Rating944.3.5.Action Based
Operation954.3.6.Analysis964.3.7.Effectiveness965.RECOMMENDATIONS985.1.Recommendations986.CONCLUSION997.BIBLIOGRAPHY100
Acknowledgment
The project of this nature is arduous task stretching over a
period of time, completing a project like this one takes the effort
and cooperation of many people.
Although this project report is being brought in my name, it
bears an imprint of guidance and cooperation of many individuals.
Several persons with whom I integrated have contributed
significantly to the successful completion of the project study. In
the successful & trouble free completion of my final term
project titled OPERATION MANAGEMENT, I am graceful to Institute of
Management and Technology, Ghaziabad for helping us towards the
completion of the project.
I extend my deepest and sincere thanks to my project guide, Mr.
Ram Krishn and other HR Executives HCL Info systems Ltd. for the
unflinching support and guidance throughout the project
I would also like to thank all the executives who shared their
precious time and experience with me.
Last but not the least, I extend my sincere thanks to all the
staff members of HCL Infosystems Ltd. for their cooperation.
Executive summaryOperation management is the process of bringing
people in to the organization making very sure that new entrants
have the potential and willingness to contribute to organizational
success. In todays scenario without effective Operation management
the organization will meet the considerable resistance when
introducing change. Without organizational change and development
survival become very uncertain so in order to make the industry
survive it is very important to adopt the different Operation
management practices in all organizations so as to understand the
employees or workers need and satisfy them. There should be
effective people utilization in every industry. All these practices
in an organization will make the organization to grow at a faster
speed. The study will be empirical and primary research will be
done by using the questionnaire which will administer to sales,
service and support function employee. The date will be collected
and assimilated by using statistical tool like median and date will
be analyzed by using Bar Chart. The analysis will be to find the
effectiveness of current PMS.
1. INTRODUCTION
1.1. HCL an overview
Born in 1976, HCL has a 3-decade rich history of inventions and
innovations. In 1978, HCL developed the first indigenous
microcomputer at the same time as Apple and 3 years before IBM's
PC. During this period, India was a black box to the world and the
world was a black box to India. This microcomputer virtually gave
birth to the Indian computer industry. The 80's saw HCL developing
know-how in many other technologies. HCL's in-depth knowledge of
Unix led to the development of a fine grained multi-processor Unix
in 1988, three years ahead of Sun and HP.
HCL's R&D was spun off as HCL Technologies in 1997 to mark
their advent into the software services arena. During the last
eight years, HCL has strengthened its processes and applied its
know-how, developed over 30 years into multiple practices -
semi-conductor, operating systems, automobile, avionics,
bio-medical engine HCL's R&D was spun off as HCL Technologies
in 1997 to mark their advent into the software services arena.
During the last eight years, HCL has strengthened its processes and
applied its know-how, developed over 30 years into multiple
practices - semi-conductor, operating systems, automobile,
avionics, bio-medical engineering, wireless, telecom technologies,
and many more.
Today, HCL sells more PCs in India than any other brand, runs
Northern Ireland's largest BPO operation, and manages the network
for Asia's largest stock exchange network apart from designing zero
visibility landing systems to land the world's most popular
airplane.
.
1976Hindustan Computers Limited (HCL) born.
1977Distribution alliance formed with Toshiba for copiers.
1978HCL successfully ships in-house designed microcomputer at
the same time as Apple. The Indian computer industry is born.
1980HCL introduces bit sliced, 16-bit processor based
microcomputer.
1983Indigenously develops an RDBMS, a Networking OS a Client
Server architecture, at the same time as global IT peers.
1986 HCL becomes the largest IT Company in India.1988HCL
introduces fine-grained multi-processor Unix-3 years ahead of Sun
and HP.1990Data Quest marks HCL No.1 amongst top ten computer
giants.1991HCL Ltd. and Hewlett Packard, USA, partner to form
HCL-Hewlett Packard Ltd.JV develops multi-processor Unix for
HP-heralds HCLs entry into contract
1994Distribution alliances formed with Ericsson Switches and
Nokia Cell phones.
1997HCL Info systems are formed. HCL's R&D spun-off as HCL
Technologies- marks advent into software services. JV with Perot
Systems, stake divested in 2003.
1999Initial Public Offering made by HCL Technologies
Ltd.Formation of Global Board of Directors.2000Large contracts won
from Bankers Trust, KLA Tenor, Cisco, GTech, NEC among
others.2001JV with Deutsche Bank- DSL software formed. HCL BPO
Incorporated. Acquired British Telecom Apollos contact center in
Belfast, Northern Ireland. HCL Info systems become largest hardware
company.2002Strong pursuit of nonlinear strategy to widen services
portfolio; several JVs and alliances formed. Strategic alliance
forged with Jones Apparel Group, Inc. a fortune 500 company.
Infrastructure services division launched to address emerging
global needs.Software businesses of HCL Info systems and HCL
Technologies merged.
2003Largest BPO order ever outsourced to an Indian BPO firm, won
from British Telecom. Landmark deals signed with Airbus and AMD.
HCL manpower crosses the 20,000 mark..2004 Accorded leader status
by Meta Group in Offshore Outsourcing. HCL is Indias No.1 PC 4th
year in a row.
2005
HCL signs Software Development Agreement with Boeing for the 787
Dream liner program. JV with NEC, Japan HCL sets up first Power PC
architecture design center outside of IBM. Completes buy-out of JVs
with Deutsche Bank and British Telecom Apollo Contact Center. HCL
integrates all group employees under HCL in domain. Sets up a
dedicated Offshore Design Center for leading Tier-1 Aerospace
supplier, Hamilton Sundstrand. HCL Info systems launches sub Rs.10,
000 PC. Joins hands with AMD, Microsoft to bridge the digital
divide.
2006
75,000+ machines produced in a single month. HCL Info systems in
partnership with Toshiba expand its retail presence in India by
unveiling 'shop Toshiba'. HCL Info systems & Nokia announce a
long-term distribution strategy. HCL the leader in Desktops PCs
unveils India's first segment specific range of notebooks brand -
'HCL Laptops'. HCL Info systems showcase Computer Solutions for the
Rural Markets in India. HCL Support wins the DQ Channels-2006 GOLD
Award for Best After Sales Service on a nationwide customer
satisfaction survey conducted by IDC. HCL AND ZEE - Dish TV team up
to take DTH TV to its next level of growth in India HCL Info
systems First in India to Launch the New Generation of High
Operation Server Platforms Powered by Intel Dual - Core Xenon 5000
Processor. HCL Forms a Strategic Partnership with APPLE to provide
Sales & Service Support for iPods in India.
HCL is one of the leading global Technology and IT enterprises
with annual revenues of US$ 4 billion. The HCL Enterprise comprises
two companies listed in India, HCL Technologies
(http://www.hcltech.com/) and HCL Info
systems(http://www.hclinfosystems.in/)
The 30 year old enterprise, founded in 1976, is one of India's
original IT garage start ups. Its range of offerings span R&D
and Technology Services, Enterprise and Applications Consulting,
Remote Infrastructure Management, BPO services, IT Hardware,
Systems Integration and Distribution of Technology and Telecom
products in India. The HCL team comprises 45,000 professionals of
diverse nationalities, operating across 17 countries including 360
points of presence in India. HCL has global partnerships with
several leading Fortune 1000 firms, including several IT and
Technology major.
1.2. HCL DNA:
Fueled by the entrepreneurial zeal of its founders, HCL
developed the first indigenous microcomputer in 1978, at the same
time as Apple. Since then, HCL has had a 3-decade rich history of
inventions and innovations. Entrepreneur is the term that best
describes the HCL employees. The TIME magazine has referred to HCL
as an "intellectual clean room where its employees could imagine
endless possibilities."
Ever since HCL entered into an alliance in 1970s, partnerships
and HCL have been inseparable. Bonds have been forged with partners
to co-create value. Strong inorganic growth is a testimony to the
spirit of partnerships.
This entrepreneurial and win-win relationship driven culture
continues to guide HCL in all its endeavors.
1.3. Employer spotlight:
HCL is one of Indias leading global IT Services companies,
providing software-led IT solutions, remote infrastructure
management services and BPO. Having made a foray into the global IT
landscape in 1999 after its IPO, focuses on Transformational
Outsourcing, working with clients in areas that impact and
re-define the core of their business. The company leverages an
extensive global offshore infrastructure and its global network of
offices in 16 countries to deliver solutions across select
verticals including Financial Services, Retail & Consumer, Life
Sciences Aerospace, Automotive, Semiconductors, Telecom and MPE
(Media Publishing & Entertainment)
HCL in India:HCL has evolved from a dream of eight youngsters in
1977 to the country's top IT group today. Our well-balanced
portfolio of turnkey solutions across equipments, software and
services make our offerings end-to-end for all IT needs of the
Indian customers. Our recognitions speak of our dominant position
in India. V&D100 2005, No. 1 Security service provider in India
by DQ Annual 2004, No.1 Infra service provider by CMP 2005, and
No.1 PC Brand recognize us as No.1 Network Management service
provider in India for the last 5 years in India.HCL is known to be
the harbinger of technology in the country. Our partnerships with
technology leaders like JDA, Oracle, SAP, KANA, Intel, and
Microsoft go back to the time when India was being recognized as a
growing and strategic market. Along with global capability, HCL has
leveraged such relationships to create value for Indian customers -
the comprehensive integrated market surveillance solution for SEBI
being one such example.Our services are backed by an extensive
direct support infrastructure spread across 170 locations
nationwide, which offer 24-x7 support offering for critical sites.
With more than 70 SAP implementations till date, HCL has been
rendering service to key Indian players in Banking, Retail and
Government.We are committed to the Indian Market and will continue
to invest more to further enrich our end-to end IT offerings for
this market. Our flexible engagement models, rich heritage of
technology solutions and over 29 years of leadership across service
areas give us a strategic advantage to meet the nation's IT
needs.
1.4. About HCL
HCL Enterprise is a leading Global Technology and IT enterprise
that comprises two companies listed in India - HCL Technologies
& HCL Info systems. The 3-decade-old enterprise, founded in
1976, is one of Indias original IT garage start-ups. Its range of
offerings span Product Engineering, Technology and Application
Services, BPO, Infrastructure Services, IT Hardware, Systems
Integration, and distribution of ICT products. The HCL team
comprises approximately 42,000 professionals of diverse
nationalities, who operate from 16 countries including 300 points
of presence in India. HCL has global partnerships with several
leading Fortune 1000 firms, including leading IT and Technology
firms. HCL Technologies is one of Indias leading global IT Services
companies, providing software-led IT solutions, remote
infrastructure management services and BPO. Having made a foray
into the global IT landscape in 1999 after its IPO, HCL
Technologies focuses on Transformational Outsourcing, working with
clients in areas that impact and re-define the core of their
business. The company leverages an extensive global offshore
infrastructure and its global network of offices in 16 countries to
deliver solutions across select verticals including Financial
Services, Retail & Consumer, Life Sciences Aerospace,
Automotive, Semiconductors, Telecom and MPE (Media Publishing &
Entertainment). For the quarter ending 31st December 2006, HCL
Technologies, along with its subsidiaries had revenue (TTM) of US $
1.155 billion (Rs.5220 crore) and employed 38,317
professionals.
1.5. Strong SAP Capabilities:HCL Technologies is one of the
largest global SAP service providers in India, providing a spectrum
of SAP services. HCL Technologies has developed strong capabilities
on the SAP Net Weaver platform and drives market demand in the SAP
world through unique market propositions and upgrade offerings to
my SAP ERP. HCL is a value added reseller and services partner
across multiple geographies. With a track record of successful
engagement in this space, HCL has received prestigious awards from
SAP - distinguished partner award 2005, best my SAP HCM
implementation award 2005, Saps "outstanding partner award for
implementation/upgrade project 2004, and more. Forrester has lauded
HCL Technologies is one of a number of firms in this space and is a
viable candidate for multinational firms that are contemplating
global outsourcing and are interested in SAP implementation and
maintenance services.
1.6. VISION STATEMENT
Together we create enterprises of tomorrow.
1.7. MISSION STATEMENT
To provide world class information technology solution and
services to enable our customers to serve their customer
better.
1.8. QUALITY POLICY STATEMENT
We will deliver defect-free products, service and solutions to
meet the requirements of our external and internal customers the
fist time, every time.
1.9. OUR OBJECTIVE
OUR MANAGEMENT OBJECTIVE
To fuel initiative and foster active by allowing individuals
freedom of action and innovation in attaining defined
objectives.
OUR PEOPLE OBJECTIVE
To help HCL Infosystem people share in the companys success,
which they make possible to provide job security based on their
Operation; to recognize their individual achievements and to help
them gain a sense of satisfaction and accomplishment from their
work.
1.10. CORE VALUES
We shall uphold the dignity of individual
We shall honor all commitments.
We shall be committed to Quality. Innovation and growth in every
endeavor.
We shall be responsible Corporate Citizens.
1.11. A SNAPSHOT OF HCL Infosystems Ltd.
Indias leading IT company HCL In say is Indias largest
information technology (IT), transnational conglomerate. With
its-depth expertise in developing solution spanning diverse
technologies.
HCL Insys aims to propel its course on to the high growth Path
total Technology Integration. Towards capturing two Ends of market
spectrum - enterprise solution and PCs.
HCL Insys has made significant strategic infrastructure
investments in the professional services Organization (PSO), the
Support Services Organization (SSO) and its manufacturing plant at
Pondicherry. Thus it is the manufacturer of general purpose
computer and provides services in the areas of IT Consultancy,
system integration, Software Development and Training.
It makes true technology integration possible across multiple
platforms, this was possible because of the in-depth expertise in
developing state-of-the-art indigenous hardware solution; thorough
understanding of networking technology.
As a part of this plan to market more and more technology
integration services world-wide, HCL in sys has already taken a
step in the direction of export by localizing its service
comprising software, hardware design and development, value added
support service networking abs repair services and overseas
integration projects to meet the demands of the global clients.
Companys continuous and consistent anticipation of the
requirement of the IT Industry has led it to undertake the
acquisition of the business of HCL Info solutions limited (now
known as Frontline Division), HCL Peripherals Limited (now known
the acquisition of Customer Support Organization (CSO) activities
of HCL Office Automation Limited (now know as office Automation
Division)
FRONTLINE DIVISION
Frontline Division, formerly HCL Info solution Ltd. (HCL Insol)
started with the aim of increasing market penetration by handing
segments not covered by HCL Insys and creating new niches. Today it
specializes.
2. Literature Review
Operations managementis an area of managementconcerned with
overseeing, designing, and controlling the process of production
and redesigning business operationsin the production of goods or
services.
Four Types of Focus Dimensions Used in Operations Management
Every business operates along four basic focus dimensions:
finance, customers, internal processes, and learning and
innovation. These theoretical divisions of operations management
come from the research of Robert S. Kaplan and David P. Norton. The
dimensions arent mutually exclusive. For example, employees who
become more competent through learning can improve the functioning
of internal processes, according to Management Principles: A
Contemporary Edition for Africa, by P. J. Smit.
FinanceThe heart of the financial dimension for most businesses
is profit, though short-term financial goals might entail
sacrificing current profits to increase future capacity. For
example, a company might decide to reinvest all its profits into
new and better machinery to increase production capacity and
efficiency, but the ultimate goal remains greater profit. Managers
must control the flow of money through the organization to ensure
short-term goals align with long-term goals.CustomersCustomers are
the foundation of your business. Without the flow of their money
through your organization, everything grinds to a halt. Managers
aim to maximize the flow of customer money, but that doesnt always
mean securing as many customers as possible. A boutique hotel, for
example, might focus on serving relatively few high-paying
customers, while a chain hotel focuses on the wide swath of people
who are unwilling to pay high prices. Though each business targets
customers who have different needs, meeting those needs is equally
vital to their profitability.Internal ProcessesOptimization of
internal processes leads to greater profitability and customer
satisfaction. For example, a manager might focus on developing
efficient communications within an organization to ensure orders
travel quickly from the customer service department to the
production line. The manager further expedites the order by
ensuring the production department syncs with the shipping
department to get the order to the customer quickly. Fine-tuning
the process to make it maximally efficient keeps operating costs
low and pleases customers, leading to greater profits.Learning and
InnovationTechnology progresses and so must businesses. An
invention that improves a manufacturing process, for example, might
be a game changer that forces factories to upgrade their processes
or lag behind competitors. A good manager stays abreast of
technological shifts; a great manager anticipates and initiates
change by encouraging her organization to focus on learning and
innovation. Practically, this can mean anything from having a
well-funded research-and-development team to paying for continuing
education for employees. An organization that surmounts cognitive
limitations stays one step ahead of its competitors.
Understanding operations management Consider the ingredients of
your breakfast this morning. Unless you live on a farm and produced
them yourself, they passed through a number of different processing
steps between the farmer and your table.
Every organization has an operations function, whether or not it
is called operations. The goal or purpose of most organizations
involves the production of goods and/or services. Operations in
some form has been around as long as human Endeavour itself but, in
modern manufacturing and service industry at least, it has changed
dramatically over time.To some (especially those professionally
involved in operations management!) operations management involves
everything an organization does. In this sense, every manager is an
operations manager.Operations management definitionsThere are many
differing definitions of operations management; we have picked a
range for you to look at below. Depending on your specific area of
operations management, some may suit your role or understanding
better, but overall they all make a similar point. The efficient
and effective implementation of the policies and tasks necessary to
satisfy an organizations customers, employees, and management (and
stockholders, if a publicly owned company) The management of
systems or processes that create goods and/or provide services "The
on-going activities of designing, reviewing and using the operating
system, to achieve service outputs as determined by the
organization for customers" (Wright, 1999) Management of main
business activity: the organizing and controlling of the
fundamental business activity of providing goods and services to
customers Operations management deals with the design and
management of products, processes, services and supply chains. It
considers the acquisition, development, and utilisation of
resources that firms need to deliver the goods and services their
clients want. The purvey of operations management ranges from
strategic to tactical and operational levels. Representative
strategic issues include determining the size and location of
manufacturing plants, deciding the structure of service or
telecommunications networks, and designing technology supply
chains. Tactical issues include plant layout and structure, project
management methods, and equipment selection and replacement.
Operational issues include production scheduling and control,
inventory management, quality control and inspection, traffic and
materials handling, and equipment maintenance policies. Operations
management is an area of management concerned with overseeing,
designing, controlling the process of production and redesigning
business operations in the production of goods and/or services. It
involves the responsibility of ensuring that business operations
are efficient in terms of using as few resources as needed, and
effective in terms of meeting customer requirements. It is
concerned with managing the process that converts inputs (in the
form of materials, labor and energy) into outputs (in the form of
goods and/or services).IOM would like to thank Derek Thomason FIOM,
Unipart Expert Practices, for sharing examples and information
contained in this section for the benefit of IOM members and those
interested in learning more about what operations management is.So
what does it means?What exactly does this mean in real terms? What
kinds of tasks, roles and responsibilities do people working in
operations management have?Forecast demand Market product Adapt to
comply with customer demand Understand what the customer wants
Understand how much the customer wants Set targets (timescales)
Know product demand Measuring standards Produce sales invoices /
solve customer disputes Measure outputs Plan production and
timescalesSourcing and procurement Order materials Negotiate price
Check delivery with order Reconcile invoice with correct supplier
statement Pay on time Buy supplies Order materials Stock control
Buying resources and allocating Inventory / stock control Schedule
suppliers Managing stock (getting it in the right place at the
right time) Locating and procuring supplies Pay suppliersCreation
of output Managing budgets Cost implications Buy cost effective
materials Replenish inventories Arrange for necessary equipment
Schedule material / staff / equipment to produce goods and services
Plan work order Produce product Produce goods Converting supplied
materials (adding value) Quality control Measure conformance /
qualityDelivery Customer satisfaction Deliver finished products
Consider logistics / delivery Arrange delivery to customer
Dispatching the goods or service to the customer Arrange packaging
/ presentationManaging people Employ people Train people
Implementing and timescales Outsource Delegation Managing people
Recruit and train staff Schedule labourBrief history of operations
managementPre 18th centuryAgriculture was the predominant industry
in every country
Industrial Revolution 17701830 Economy based on manual labour
was replaced by one dominated by industry and the manufacture of
machinery The development of all-metal machine tools in the first
two decades of the 19th century facilitated the manufacture of more
production machines powered by steam or wate (James Watt,
1785)Second Industrial Revolution (around 1850) Development of
steam-powered ships, railways, and later in the nineteenth century
with the internal combustion engine and electrical power generation
Introduction of Frederick W. Taylor's systematic approach to
scientific management atthe beginning of the twentieth century
(1911) Henry Ford, father of the moving assembly line, brought the
world into an age centred around the mass production of goods
(1920)Post WWII Leverage of management science techniques that were
developed in the war Growth in power of computers Japanese Toyota
Production System (TPS) based on three principles:1. Quality2.
Continual Improvement3. Elimination of wasteLate 1950s and early
1960s Move from industrial engineering and operations research into
production management Production management becomes a professional
field as well as an academic discipline Major world economies
evolving into the service arena:o service jobs outnumber
manufacturing jobso productivity increases much more difficult to
achieve Operations techniques begin to be incorporated into
services -the term production/operations management comes into
useToday Environmental and social awarenessTypes of operations
managementEvery organisation has an operations function, whether or
not it is called operations. The goal or purpose of most
organisations involves the production of goods and/or services.
These pages provide you with an idea of the sorts of tasks and
processes that relate to operations management within each of the
following industry types. Manufacturing products Providing
insurance cover Providing healthcare Government Armed Forces peace
keeping OXFAM bringing reliefManufacturing productsManaging
operations Receiving requirements Procuring raw materials
Recruiting and retaining staff Budgeting and cash management
Meeting Health, Safety and Legal requirements Planning resources
Improving quality, cost and delivery Procuring / managing assets
Defining policies and procedures Making products Storing and
distributing products Negotiations Provide training Plan raw
materials Process raw materials Make intermediates Process copy
(for Control) Printing Quality control Recycling / reworkProviding
insurance coverManaging operations Receiving requests for cover
Assessing / reassess risk Answering customer enquiries Undertaking
competitor reviews Processing claims Making payments Recruiting and
retaining staff Budgeting and cash-flow management Meeting Health,
Safety and Legal requirements Planning resources Improving quality,
cost and delivery Customer care process Accredit repairers Forecast
demand Process applications Process renewals Calculate no claims
bonuses Arrange repairs Send out certificates / reminders Send out
claims formsProviding healthcareManaging operations Obtaining
finance Project / programme Management Recruiting and retaining
staff Sourcing and procuring supplies Responding to emergencies
Scheduling patient operations Controlling infection Providing post
operative care Capacity planning (bed / theatre management) Quality
control / track and trace Dispatch ambulance Inform hospital of
arrival Inform stakeholders Contact theatre team Provide interim
care stabilise patient Prepare resource (theatre) Kitting for
operations Resource planning (ITU / ward) Plan diagnostics
resources Liaise with other department Deploy
ambulanceGovernmentManaging operations HMRCo Process tax formso
Investigate errorso Prosecute offenderso Labour planning Social
Serviceso Assessing risko Providing support services Emergency
Serviceso Capacity planningo Resource deployment Central
Governmento Generate new lawso Influence peopleo Process claimantso
Allocate resources according to needo Educate and train peopleArmed
ForcesManaging operations Training and development Contingency
planning Capital investment and programme management Logistics
(soldiers and materials) Supply chain management Returns management
Deployment Measurement and control Manage budgets and costs
Stakeholder management Manage people Manage resources (equipment
and materials) Management of maintenanceOXFAMManaging operations
Generate funds Contingency planning Material and labour planning
Forecast demand Source and procure non-perishables Response time
management What-if and scenario planning Deploying aid (people and
materials) Transport to site of disaster Enabling sustainability
Distribute to people in need Plan for short term and longer term
sustainability Conduct risk assessment Skills assessment / training
Manage shops Run collections / donations Receive goods and price in
shops
What do operations managers do?Strategic (long term) Level
Responsible for, and decisions about:o What to make (product
development)o How to make it (process and layout decisions) or
should we buy it?o Where to make it (site location)o How much is
needed (high level capacity decisions)Tactical Level (intermediate
term) Address material and labour resourcing within strategy
constraints, for example:o How many workers are needed and when
(labour planning)o What level of stock is required and when should
it be delivered (inventory and replenishment planning)o How many
shifts to work. Whether overtime or subcontractors are required
(detailed capacity planning)Operational Level Detailed lower-level
(daily/weekly/monthly) planning, execution and control decisions,
for example:o What to process and when (scheduling)o The order to
process requirements (sequencing)o How work is put on resources
(loading)o Who does the work (assignments)
What skills do operations managers need?Have knowledge of:
advanced operations technology and technical knowledge relevant to
his/her industry interpersonal skills and knowledge of other
functional areas the ability to communicate effectively, motivate
other people, manage projects, and work on multidisciplinary
teamsMulti-disciplinary working, for example: Supply chains
management of all aspects of providing goods to a consumer from
extraction of raw materials to end-of-life disposal The interface
with marketing determining what customers' value prior to
product/service development Operations management/finance interface
capital equipment and inventories comprise a sizable portion of
many firms' assets in addition to normal operating costs Service
operations coping with inherent service characteristics such as
simultaneous delivery/consumption, performance measurements, etc
Operations strategy consistent and aligned with other strategies
and legal requirements Process design and improvements managing the
innovation process
Issues facing operations managersMajor issues are: Environmental
sustainability, recycling , reuse Counter terrorism / risk
management Globalisation of supply and demand Reducing time to
market Achieving and sustaining high quality while controlling cost
Integrating new technologies and control systems into existing
processes Obtaining, training, and keeping qualified workers and
managers Working effectively with other functions to accomplish the
goals Integrating production and service activities at multiple
sites in decentralized organisations Working effectively with
suppliers and customers Strategic alliancesAll these are critical
issues. Operations management is at the very core of most
organisations. We can no longer focus on isolated tasks and
processes but must be one of the architects of the overall business
operating model.
Another language???There are lots of words and terms used in
operations management, many of which are explained in full in the
IOMs Knowledge Bank. Members can login to the members area to find
out what these terms mean in full. World class S&OP (Sales and
Operations Planning) Six Sigma Lean vs agile KPIs Master scheduling
MRP Processes TPS (Toyota Production System) Theory of constraints
Balanced scorecard DRP Kaizen TPM Change management Continuous
improvement Planning and scheduling ERP systems
Operations managementis an area ofmanagementconcerned with
overseeing, designing, and controlling the process ofproductionand
redesigningbusiness operationsin the production ofgoodsorservices.
It involves the responsibility of ensuring thatbusinessoperations
areefficientin terms of using as few resources as needed,
andeffectivein terms of meeting customer requirements. It is
concerned with managing the process that converts inputs (in the
forms ofraw materials,labor, andenergy) into outputs (in the form
of goods and/or services).[1]The relationship of operations
management tosenior managementin commercial contexts can be
compared to the relationship ofline officersto highest-level senior
officers inmilitary science. The highest-level officers shape
thestrategyand revise it over time, while the line officers
maketacticaldecisions in support of carrying out the strategy. In
business as in military affairs, the boundaries between levels are
not always distinct; tactical information dynamically informs
strategy, and individual people often move between roles over
time.
Ford Motor car assembly line: the classical example of a
manufacturing production system.Post officequeue. Operations
management studies both manufacturing andservices.According to
theUnited States Department of Education, operations management is
the field concerned with managing and directing the physical and/or
technical functions of afirmororganization, particularly those
relating to development, production, and manufacturing. Operations
management programs typically include instruction in principles of
general management,manufacturingand production
systems,factorymanagement,
equipmentmaintenancemanagement,production control,
industriallaborrelations and skilled trades supervision, strategic
manufacturing policy,systems analysis,productivityanalysis andcost
control, and materials planning.[2][3]Management, including
operations management, is likeengineeringin that it blends art
withapplied science. People skills, creativity, rational analysis,
and knowledge oftechnologyare all required for success.
HistoryThe history of production and operation systems began
around 5000 B.C. whenSumerianpriests developed the ancient system
of recording inventories, loans, taxes, and business transactions.
The next major historical application of operation systems occurred
in 4000 B.C. It was during this time that theEgyptiansstarted
usingplanning, organization, andcontrolin largeprojectssuch as the
construction of the pyramids. By 1100 B.C., labor was being
specialized inChina; by about 370 B.C.,Xenophondescribed the
advantages of dividing the various operations necessary for the
production of shoes among different individuals in ancientGreece
.In theMiddle Ages, kings and queens ruled over large areas of
land. Loyal noblemen maintained large sections of the monarchs
territory. This hierarchical organization in which people were
divided into classes based on social position and wealth became
known as the feudal system. In the feudal system, servants produced
for themselves and people of higher classes by using the rulers
land and resources. Although a large part of labor was employed in
agriculture,artisanscontributed to economic output and
formedguilds. The guild system, operating mainly between 1100 and
1500, consisted of two types: merchant guilds, who bought and sold
goods, and craft guilds, which made goods. Although guilds were
regulated as to the quality of work performed, the resulting system
was rather rigid,shoemakers, for example, were prohibited from
tannin hides. The industrial revolution was facilitated by two
elements: interchangeability of parts and division of
labor.Division of laborhas always been a feature from the beginning
ofcivilization, the extent to which the division is carried out
varied considerably depending on period and location. Compared to
the Middle Ages, theRenaissanceand theAge of Discoverywas
characterized by a greater specialization in labor, one of
characteristics of growing European cities and trade. It was in the
late eighteenth century whenEli Whitneypopularized the concept of
interchangeabilitywhen he manufactured 10,000 muskets. Up to this
point in history of manufacturing, each product (e.g. each gun) was
considered a special order, meaning that parts of a given gun were
fitted only for that particular gun and could not be used in other
guns. Interchangeability of parts allowed the mass production of
parts independent of the final products in which they will be
used.In 1883,Frederick W. Taylorintroduced thestopwatchmethod for
accurately measuring the time to perform each single task of a
complicated job. He developed the scientific study of productivity
and identifying how to coordinate different tasks to eliminate
wasting of time and increase the quality of work. The next
generation of scientific study occurred with the development ofwork
samplingandpredetermined motion time systems(PMTS). Work sampling
is used to measure the random variable associated with the time of
each task. PMTS allows the use of standard predetermined tables of
the smallest body movements (e.g. turning the left wrist by 90),
and integrating them to predict the time needed to perform a simple
task. PMTS has gained substantial importance due to the fact that
it can predict work measurements without actually observing the
actual work. The foundation of PMTS was laid out by the research
and development ofFrank B.andLillian M. Gilbretharound 1912. The
Gilbreths took advantage of taking motion pictures at known time
intervals while operators were performing the given task.The idea
of the production line has been used multiple times in history
prior to Henry Ford: theVenetian Arsenal(1104), Smith pin
manufacturing in theWealth of Nations(1776) or Brunel'sPortsmouth
Block Mills(1802).Ransom Oldswas the first to manufacture cars
using the assembly line system, butHenry Forddeveloped the first
auto assembly system where a car chassis was moved through the
assembly line by a conveyor belt while workers added components to
it until the car was completed. During World War II, the growth of
computing power led to further development of efficient
manufacturing methods and the use of advanced mathematical and
statistical tools. This was supported by the development of
academic programs in industrial and systems engineering
disciplines, as well as fields of operations research and
management science (as multi-disciplinary fields of problem
solving). Whilesystems engineeringconcentrated on the broad
characteristics of the relationships between inputs and outputs of
generic systems, operations researchers concentrated on solving
specific and focused problems. The synergy ofoperations researchand
systems engineering allowed for the realization of solving large
scale and complex problems in the modern era. Recently, the
development of faster and smaller computers, intelligent systems,
and theWorld Wide Webhas opened new opportunities for operations,
manufacturing, production, and service systems.Malakooti (2013)
states that production and operation systems can be divided into
five phases:[6]1. Empiricism(learning from experience)2.
Analysis(scientific management)3. Synthesis(development of
mathematical problem solving tools)4. Isolated Systems with Single
Objective (use ofIntegratedand Intelligent Systems, and WWW)5.
Integrated Complex Systems with Multiple Objectives (development of
ecologically sound systems, environmentallysustainablesystems,
considering individual preferences)
Industrial RevolutionBefore theFirst industrial revolutionwork
was mainly done through two systems:domestic systemandcraft guilds.
In the domestic system merchantstook materials to homes where
artisans performed the necessary work, craft guilds on the other
hand were associations of artisanswhich passed work from one shop
to another, for example: leather was tanned by atanner, passed
tocurriers, and finally arrived atshoemakersandsaddlers.The
beginning of the industrial revolution is usually associated with
18th century Englishtextile industry, with the invention ofshuttle
byJohn Kayin 1733, thespinning jennybyJames Hargreavesin 1765,
thewater framebyRichard Arkwrightin 1769 and thesteam enginebyJames
Wattin 1765. In 1851 at theCrystal Palace Exhibitionthe
termAmerican system of manufacturingwas used to describe the new
approach that was evolving in theUnited States of Americawhich was
based on two central features:interchangeable partsand extensive
use ofmechanizationto produce them.Henry Ford was 39 years old when
he founded the Ford Motor Company in 1903, with $28,000 capital
from twelves investors. Themodel Tcar was introduced in 1908,
however it was not until Ford implemented the assembly line
concept, that his vision of making a popular car affordable by
every middle-class American citizen would be realized. The first
factory in whichHenry Fordused the concept of theassembly
linewasHighland Park(1913), he characterized the system as
follows:"The thing is to keep everything in motion and take the
work to the man and not the man to the work. That is the real
principle of our production, andconveyorsare only one of many means
to an end"This became one the central ideas that led tomass
production, one of the main elements of theSecond Industrial
Revolution, along with emergence of theelectrical industryand
petroleum.
Although productivity benefited considerably from technological
inventions and division of labour, the problem of systematic
measurement of performances and the calculation of these by the use
offormulasremained somewhat unexplored until Frederick Winslow
Taylor.Frederick Taylorearly work focused on developing what he
called a "differential piece-rate system"and a series of
experiments, measurements and formulas dealing withcutting
metalsand manual labor.The differentialpiece-rate systemconsisted
in offering two different pay rates for doing a job: a higher rate
for workers with high productivity (efficiency) and who produced
high quality goods (effectiveness) and a lower rate for those who
fail to achieve the standard. One of the problems Taylor believed
could be solved with this system, was the problem ofsoldiering:
faster workers reducing their production rate to that of the
slowest worker. In 1911 Taylor published his "The Principles of
Scientific Management",in which he characterizedscientific
management(also know asTaylorism) as:1. The development of a
truescience;2. The scientific selection of theworker;3. The
scientific education and development of the worker;4. Intimate
friendlycooperationbetween the management and the workers.Taylor is
also credited for developing stopwatch time study, this combined
withFrankandLillianGilbreth motion study gave way totime and motion
studywhich is centered on the concepts of standard method
andstandard time. Frank Gilbreth is also responsible for
introducing theflow process chart. Other contemporaries of Taylor
worth remembering areMorris Cooke(rural electrification in the
1920s and implementer of Taylor's principles of scientific
management in the Philadelphia's Department of Public Works),Carl
Barth(speed-and-feed-calculating slide rules ) andHenry Gantt(Gantt
chart). Also in 1910Hugo Diemerpublished the firstindustrial
engineeringbook: Factory Organization and Administration.In 1913
Ford W. Harris published his "How Many parts to make at once" in
which he presented the idea of theeconomic order quantitymodel. He
described the problem as follows:"Intereston capital tied up
inwages, material andoverheadsets a maximum limit to the quantity
of parts which can be profitably manufactured at one time; "set-up"
costs on the job fix the minimum. Experience has shown one manager
a way to determine the economical size of lots"This paper inspired
a large body of mathematical literature focusing on the problem
ofproduction planningandinventory control.In 1924Walter
Shewhartintroduced thecontrol chartthrough a technical memorandum
while working atBell Labs, central to his method was the
distinction betweencommon cause and special causeof variation. In
1931 Shewhart published his Economic Control of Quality of
Manufactured Product,the first systematic treatmentof the subject
ofStatistical Process Control(SPC).In the 1940smethods-time
measurement(MTM) was developed by H.B. Maynard, JL Schwab and GJ
Stegemerten. MTM was the first of a series ofpredetermined motion
time systems, predetermined in the sense that estimates of time are
not determined in loco but are derived from an industry standard.
This was explained by its originators in a book they published in
1948 called "Method-Time Measurement".Up to this point in
history,optimizationtechniques were known for a very long time,
from the simple methods employed by F.W.Harris to the more
elaborate techniques of thecalculus of variationsdeveloped
byEulerin 1733 or themultipliersemployed byLagrangein 1811,
andcomputerswere slowly being developed, first asanalog
computersbySir William Thomson(1872) andJames Thomson(1876) moving
to the eletromechanical computers ofKonrad Zuse(1939 and 1941).
DuringWorld War IIhowever, the development ofmathematical
optimizationwent trough a major boost with the development of
theColossus computer, the first electronic digital computer that
was all programmable, and the possibility to computationally solve
largelinear programmingproblems, first byKantorovichin 1939 working
for theSoviet governmentand latter on in 1947 with thesimplex
methodofDantzig. These methods are known today as belonging to the
field ofoperations research.From this point on a curious
development took place: while in the United States the possibility
of applying the computer to business operations led to the
development of management software architecture such asMRPand
successive modifications, and ever more sophisticated optimization
techniques andmanufacturing simulationsoftware, in post-war Japan a
series of events at Toyota Motor led to the development of
theToyota Production System(TPS) andLean Manufacturing.In 1943, in
Japan,Taiichi Ohnoarrived atToyota Motorcompany. Toyota evolved a
unique manufacturing system centered on two complementary
notions:just in time(produce only what is needed)
andautonomation(automation with a human touch). Regarding JIT, Ohno
was inspired by Americansupermarkets: workstations functioned like
a supermarket shelf where the customer can get products they need,
at the time they need and in the amount needed, the workstation
(shelf) is then restocked. Autonomation was developed byToyoda
Sakichiin Toyoda Spinning and Weaving: an automatically activated
loom that was also foolproof, that is automatically detected
problems. In 1983 J.N Edwards published his "MRP and
Kanban-American style" in which he described JIT goals in terms of
seven zeros:zero defects, zero (excess) lot size, zero setups, zero
breakdowns, zero handling, zero lead time and zero surging. This
period also marks the spread ofTotal Quality Management(TQM) in
Japan, ideas initially developed by American authors such
asDeming,JuranandArmand V. Feigenbaum.TQM is a strategy for
implementing and managing quality improvement on an organizational
basis, this includes: participation, work culture, customer focus,
supplier quality improvement and integration of the quality system
with business goals.[14]Schnonberger[18]identified seven
fundamentals principles essential to the Japanese approach:1.
Process control:SPCand worker responsibility over quality2. Easy
able -to-see quality: boards, gauges, meters, etc. andpoka-yoke3.
Insistence on compliance: "quality first"4. Line stop: stop the
line to correct quality problems5. Correcting one's own errors:
worker fixed a defective part if he produced it6. The 100% check:
automated inspection techniques and foolproof machines7. Continual
improvement: ideally zero defectsIn 1987 theInternational
Organization for Standardization(ISO), recognizing the growing
importance of quality, issued theISO 9000, a family of standards
related to quality management systems. There has been some
controversy thought regarding the proper procedures to follow and
the amount of paperwork involved.Meanwhile in the sixties, a
different approach was developed by George W. Plossl and Oliver W.
Wright,[19]this approach was continued by Joseph Orlicky as a
response to the TOYOTA Manufacturing Program which led toMaterial
Requirements Planning(MRP) atIBM, latter gaining momentum in 1972
when the American Production and Inventory Control Society launched
the "MRP Crusade". One of the key insights of this management
system was the distinction betweendependent demandandindependent
demand. Independent demand is demand which originates outside of
the production system, therefore not directly controllable, and
dependent demand is demand for components of final products,
therefore subject to being directly controllable by management
through thebill of materials, viaproduct design. Orlicky wrote
"Materials Requirement Planning" in 1975,[20]the first hard cover
book on the subject.[19]MRP IIwas developed by Gene Thomas at IBM,
and expanded the original MRP software to include additional
production functions.Enterprise resource planning(ERP) is the
modern software architecture, which addresses, besides production
operations,distribution,accounting,human
resourcesandprocurement.Recent trends in the field revolve around
concepts such as: Business Process Re-engineering(launched
byMichael Hammerin 1993[21]): a business management strategy
focusing on the analysis and design of workflows and business
processes within an organization. BPR seeks to help companies
radically restructure their organizations by focusing on the
ground-up design of their business processes. Lean Manufacturing: a
systemic method for the elimination of waste ("Muda") within a
manufacturing process. Lean also takes into account waste created
through overburden ("Muri") and waste created through unevenness in
work loads ("Mura"). The term lean manufacturing was coined in the
bookThe Machine that Changed the World.[22] Six Sigma(an approach
to quality developed atMotorolabetween 1985-1987): Six Sigma refers
to control limits placed at six (6)standard deviationsfrom the mean
of anormal distribution, this became very famous afterJack
WelchofGeneral Electriclaunched a company-wide initiative in 1995
to adopt this set of methods. More recently, Six Sigma has
includedDMAIC(for improving processes) andDFSS(for designing new
products and new processes) Reconfigurable Manufacturing Systems: a
production system designed at the outset for rapid change in its
structure, as well as its hardware and software components, in
order to quickly adjust its production capacity and functionality
within a part family in response to sudden market changes or
intrinsic system change.
2.1. An Introduction of Operation Management
2.1.1. What is Operation management?Operation management is the
activity of tracking Operation against targets and identifying
opportunities for improvement - but not just looking back at past
Operation. The focus of Operation management is the future - what
do you need to be able to do and how can you do things better?
Managing Operation is about managing for results. Operation-based
management at any level in the organization should demonstrate
that
You know what you are aiming for You know what you have to do to
meet your objectives You know how to measure progress towards your
objectives You can detect Operation problems and remedy them
2.1.2. Why is it important?
The Modernizing Government agenda sets challenging new Operation
objectives for organizations, from the delivery of high quality
services that meet the needs of their customers and stakeholders,
to doing more within the constraints of available resources,
through to continuous improvement in how the organization itself
operates. Operation management underpins the operations and
processes within a strategic change program framework. Sound
practices and targets, which are both flexible and reactive to
change, are needed to achieve Operation improvement.
The effective Operation of your organization depends on the
contributions of activities at all levels - from top management
policy development through to efficiently run operations.
In response to the pressures and opportunities for improving
organizational Operation, you need to understand how to define and
measure Operation as part of a concerted strategy for relevant,
successful and cost-effective operations.
2.1.3. Critical factors for success
Focusing on outcomes that meet business objectives, rather than
outputs Managing Operation by cascading down from the top and
building bottom-up Defining and using measures that evolve over
time Using a mix of short and long term measures, and selecting
measures that link cause and effect Measuring effectiveness (doing
the right things) and efficiency (doing things right) in parallel
Relating individuals' reward and remuneration with achievement of
outcomes.
2.1.4. Who is involved?
Business managers are responsible for setting targets and
managing Operation against those targets; contract managers monitor
service Operation from the customer viewpoint; service providers
supply Operation information. 2.1.5. Principles
Operation management should be an integrated part of a business
lifecycle helping an organization to mature through evolving and
changing Operation measures, from their definition through to
monitoring and review in addition, by including the IS/IT component
throughout this lifecycle, rather than just considering it as a
'downstream' cost of provision, there should be enhanced benefits
from an increased and more effective contribution from any
investment made in IS/IT.
You will need to ensure that you have adopted sound practices in
commissioning and acquiring IS/IT services to achieve Operation
improvement. Operation management identifies opportunities for
maximizing improvements in managing service delivery in the future.
Operation management helps you to make decisions about investment
routes, affordability and setting investment priorities in the face
of competing demands for resources.
2.1.6. Managing for results
Managing for results requires the organization to focus on the
outputs of the processes and activities undertaken by the
organization at varying levels. Together these outputs will
contribute to the achievement of the outcomes desired by the
organization and those of the government as a whole. 2.2. Levels of
Operation management 1. The effective Operation of your
organization depends on the contribution of activities at all
levels - from top management policy development through to
efficiently run operations. There are three or four levels of
Operation management in the model framework below, some
organizations may combine the strategic level with the
organizations priorities level.
2. Organizations priorities: at the highest level Operation
management is rooted in the organizations long term business
strategy. Measures at this level are of impact, resource
utilization and public service improvement.
3. Strategic level Operation management: at this level the
management concern is from an "outside in" as well as an internal
perspective. Measures are of outcome, such as volume and value of
service take-up, upward trends for inclusion, staff and users'
satisfaction.
4. Program level Operation management: Operation management at
this level is focused on the desired results of programs of change,
to demonstrate what has been accomplished. The measures used would
include those stated in individual business cases. Benefits
management would help to determine if these are achieved.
5. Tactical or operational service level Operation management:
here the management focus is concerned with service delivery and
outputs, using conventional service level agreement approaches and
related measures of aspects such as volumes and quality.
Although Operation measures and indicators may be different at
each level, they will need to be. Directional - to confirm that you
are on track to reach the goals. Quantitative - to show what has
been achieved and how much more is to be done. Worthwhile - adding
more value to the business than they cost to collect and use.
2.3. Value for money
You must be able to demonstrate that you have achieved value for
money in your operations. Value for money is taken to cover three
measures of Operation:
Economy - Minimizing the cost of resources used for an activity,
having regard to appropriate quality Efficiency - the relationship
between outputs, in terms of goods, services or other results and
the resources used to produce them Effectiveness - the extent to
which objectives have been achieved, and the relationship between
the intended impacts and actual impacts of an activity.
2.4. Measures and metrics
You should use these evaluation criteria for measures and
metrics:
Are you measuring the right thing? Do you have the right
measures? Are the measures used in the right ways? Do you determine
the quality of a particular Operation metric using the SMART test
(Specific, Measurable, Attainable, Relevant, Timely)?
The procedures and measures used in Operation management will
depend, among other factors, on the type of business process which
is being measured. A business process is assumed to be made up of a
number of activities which transform inputs into outputs and
contribute to the realisation of outcomes. The customers for a
process may be external (for example, members of the public) or
internal, within the same organisation or elsewhere in the public
sector.2.4.1. Business processes can be distinguished by: The
extent to which the activities involved are people-oriented as
opposed to automated Whether the activities are primarily
'front-office' or 'back-office' - that is, the amount of direct
contact which the staff have with the customers or recipients of
the process Whether the process itself is the important feature of
the activity - for example, in delivering consultancy - or whether
the activities are concerned primarily with the generation of
defined outputs The extent to which the activity is customized or
tailored to the needs of each customer, as opposed to being routine
and procedural The amount of discretion which needs to be exercised
in the activities The duration of the contact with the
customer.2.5. Processes
You will need to review the effectiveness of your procedures
for: Setting Operation targets Designing measures of Operation
relevant to the targets Systematically and accurately measuring
outcomes Assessing the Operation of external service providers
Using results for informed decision-making Improving Operation.
Research shows that most organizations have the components of
Operation management in place, but they are not always used to
overall advantage. A possible five-step approach that could help
organizations in improving the Operation management of the IS/IT
contribution is outlined below, with suggested techniques.
Step 1: Identify your level of maturity in Operation
management
Look at how the organization is performing in all its aspects of
Operation management - from direction setting through to review and
measurable improvement. Do an assessment; this will help to
identify your organizations maturity and the strengths and
weaknesses. Establish where you are now as a series of baselines,
looking at Operation management at strategic program, tactical and
operational levels. Bottom-up measures of economy and efficiency
are likely to be reasonably strong and have good management. This
may not be so well developed for effectiveness measures Innovation,
process improvement, customer satisfaction, and contribution to
policy objectives. Most organizations have a good understanding of
financial measure; this level of understanding needs to be
developed for other measures. Techniques: Assessment; baseline
Step 2: Identify where Operation management is important to your
organization Is it in setting direction or ensuring the delivery of
required benefits or improving the alignment, Operation and
contribution of the internal and external resources used by the
organization? Identify the values for your organization. Key values
for safety critical operational services are speed and integrity of
information. A different organization might place high value on
information flows or on single points of access to information at a
contact/call centre. Techniques: Value chain analysis; benchmarking
with other organizations (which may identify things you had not
thought of)
Step 3: Resolve any mismatch between steps 1 and 2
Review Operation management at each of the four levels -
(organization, strategic, program and tactical). Are there
weaknesses in areas that are important to your organization?
Techniques: to become more outward looking and customer-focused,
use the well established balanced scorecard and EFQM techniques. To
answer questions about where IT makes a contribution, use Goals,
Questions and Metrics (GQM) to identify and define measures.
Step 4: Establish where you want to be and begin to build
Operation management into business processes and into the
culture
The aim is to have target, measurement and review processes for
those things that the business considers important such as product,
process, service and staff. You will have lots of measures which
need to be prioritised against your particular perspective on
effectiveness, efficiency and economy and against your values.
establish benefits management as a norm Use databases to collect
Techniques Operation information and analyse trends Include
Operation management in the business, programme and project
lifecycle
Step 5 : Feed information back into Operation improvement
Monitor and take action on:
We achieve what we set out to do? Where are the opportunities to
improve? What can we do to improve? You are seeking answers to:
What is achievable? What is important for our organization? What
was achieved?
Techniques: Process assessment; your own targets, looking at
benchmarks from the outside world.
The process of Operation management
2.6. Objectives of a Operation Management System
Operation management is an integral part of a comprehensive
human resource management strategy. Its objective is to maximize
individuals' Operation and potential with a view to attaining
organizational goals and enhancing overall effectiveness and
productivity.
A staff Operation management system aims at: - To help achieve
departmental objectives through staffDepartments formulate
strategies and objectives to support their vision, mission and
values. To achieve these broad objectives, departments have to turn
them into specific objectives and targets for the divisions,
sections, units and subsequently individual job objectives and
targets for implementation. As individual job objectives are linked
to those of departments', the Operation of individual officers
contributes to the delivery of departmental objectives.
To evaluate Operation and improve communication between managers
and staff on managing OperationThe staff Operation management
system provides a mechanism to monitor and evaluate staff
Operation. Operation objectives are set at the beginning of the
Operation management cycle through open discussion between the
supervisors and the appraisees. Progress is monitored regularly and
feedback from staff and supervisors is collated to help clarify
objectives and output expectation; and to enhance Operation.
To provide opportunities for developmentThe staff Operation
management system serves as a multi-purpose management tool. It
provides valuable information to help identify individual training
needs so as to enhance Operation and to develop the potential of
the staff for further advancement. The following figure provides an
illustration of how Operation management links with other human
resource functions.
2.7. Overall Goal and Focus of Operation Management
The overall goal of Operation management is to ensure that the
organization and all of its subsystems (processes, departments,
teams, employees, etc.) are working together in an optimum fashion
to achieve the results desired by the organization. 2.8. Operation
Improvement of the Organization or a Subsystem is an Integrated
Process
Note that because Operation management strives to optimize
results and alignment of all subsystems to achieve the overall
results of the organization, any focus of Operation management
within the organization (whether on department, process, employees,
etc.) should ultimately affect overall organizational Operation
management as well. 2.9. Ongoing Activities of Operation
Management
Achieving the overall goal requires several ongoing activities,
including identification and prioritization of desired results,
establishing means to measure progress toward those results,
setting standards for assessing how well results were achieved,
tracking and measuring progress toward results, exchanging ongoing
feedback among those participants working to achieve results,
periodically reviewing progress, reinforcing activities that
achieve results and intervening to improve progress where needed.
Note that results themselves are also measures.
Note: these general activities are somewhat similar to several
other major approaches in organizations, e.g., strategic planning,
management by objectives, Total Quality Management, etc. Operation
management brings focus on overall results, measuring results,
focused and ongoing feedback about results, and development plans
to improve results. The results measurements themselves are not the
ultimate priority as much as ongoing feedback and adjustments to
meet results.
The steps in Operation management are also similar to those in a
well-designed training process, when the process can be integrated
with the overall goals of the organi zation. Trainers are focusing
much more on results for Operation. Many trainers with this
priority now call themselves Operation consultants.
2.10. Basic Steps
Various authors propose various steps for Operation management.
The typical Operation management process includes some or all of
the following steps, whether in Operation management of
organizations, subsystems, processes, etc. Note that how the steps
are carried out can vary widely, depending on the focus of the
Operation efforts and who is in charge of carrying it out. For
example, an economist might identify financial results, such as
return on investment, profit rate, etc. An industrial psychologist
might identify more human-based results, such as employee
productivity.
The following steps are described more fully in the topics
Operation Plan, Operation Appraisal and Development Plan, including
through use of an example application. The steps are generally
followed in sequence, but rarely followed in exact sequence.
Results from one step can be used to immediately update or modify
earlier steps. For example, the Operation plan itself may be
updated as a result of lessons learned during the ongoing
observation, measurement and feedback step.
NOTE: The following steps occur in a wide context of many
activities geared towards Operation improvement in an organization,
for example, activities such as management development, planning,
organizing and coordinating activities.1. Review organizational
goals to associate preferred organizational results in terms of
units of Operation, that is, quantity, quality, cost or timeliness
(note that the result itself is therefore a measure)2. Specify
desired results for the domain -- as guidance, focus on results
needed by other domains (e.g., products or services need by
internal or external customers)
3. Ensure the domain's desired results directly contribute to
the organization's results4. Weight, or prioritize, the domain's
desired results.5. Identify first-level measures to evaluate if and
how well the domain's desired results were achieved6. Identify more
specific measures for each first-level measure if necessary7.
Identify standards for evaluating how well the desired results were
achieved (e.g., "below expectations", "meets expectations" and
"exceeds expectations")8. Document a Operation plan -- including
desired results, measures and standards9. Conduct ongoing
observations and measurements to track Operation10. Exchange
ongoing feedback about Operation11. Conduct a Operation appraisal
(sometimes called Operation review)12. If Operation meets the
desired Operation standard, then reward for Operation (the nature
of the reward depends on the domain)13. If Operation does not meet
the desired Operation standards, then develop or update a Operation
development plan to address the Operation gap* (See Notes 1 and
2)14. Repeat steps 9 to 13 until Operation is acceptable, standards
are changed, the domain is replaced, management decides to do
nothing, etc.
Note 1: Inadequate Operation does not always indicate a problem
on the part of the domain. Operation standards may be unrealistic
or the domain may have insufficient resources. Similarly, the
overall strategies or the organization, or its means to achieving
its top-level goals, may be unrealistic or without sufficient
resources.
Note 2: When Operation management is applied to an employee or
group of employees, a development plan can be initiated in a
variety of situations E.g.
a. When a Operation appraisal indicates Operation improvement is
needed, that is, that there is a "Operation gap"
b. To "benchmark" the status of improvement so far in a
development effort
c. As part of a professional development for the employee or
group of employees, in which case there is not a Operation gap as
much as an "growth gap
d. As part of succession planning to help an employee be
eligible for a planned change in role in the organization, in which
case there also is not a Operation gap as much as an "opportunity
gap"
e. To "pilot", or test, the operation of a new Operation
management system.
2.11. Operation management mainly include following things:
Operation management is the systematic process by which an
agency involves its employees, as individuals and members of a
group, in improving organizational effectiveness in the
accomplishment of agency mission and goals.
Planning work and setting expectations, Continually monitoring
Operation, Developing the capacity to perform, Periodically rating
Operation in a summary fashion, and Rewarding good Operation.
The revisions made in 1995 to the Government wide Operation
appraisal and awards regulations support sound management
principles. Great care was taken to ensure that the requirements
those regulations establish would complement and not conflict with
the kinds of activities and actions practiced in effective
organizations as m after of course.Additional background
information on Operation management can be found in the
following
2.11.1. Planning
In an effective organization, work is planned out in advance.
Planning means setting Operation expectations and goals for groups
and individuals to channel their efforts towards achieving the
organizational objectives. Getting employees involved in the
planning process will help them understand the goals of the
organization, what needs to be done, why it needs to be done, and
how well it should be done.
The regulatory requirements for planning employees' Operation
include establishing the elements and standards of their Operation
appraisal plans. Operation elements and standards should be
measurable, understandable, verifiable, equitable, and achievable.
Through critical elements, employees are held accountable as
individuals for work assignments or responsibilities. Employee
Operation plans should be flexible so that they can be adjusted for
changing program objectives and work requirements. When used
effectively, these plans can be beneficial working documents that
are discussed often, and not merely paperwork that is filed in a
drawer and seen only when ratings of record are requirement
2.11.2. Monitoring
In an effective organization, assignments and projects are
monitored continually. Monitoring well means consistently measuring
Operation and providing ongoing feedback to employees and work
groups on their progress toward reaching their goals.Regulatory
requirements for monitoring Operation include conducting progress
reviews with employees where their Operation is compared against
their elements and standards. Ongoing monitoring provides the
opportunity to check how well employees are meeting predetermined
standards and to make changes to unrealistic or problematic
standards. And by monitoring continually, unacceptable Operation
can be identified at any time during the appraisal period and
assistance provided to address such Operation rather than wait
until the end of the period when summary rating levels are
assigned.
2.11.3. Developing Employees
In an effective organization, employee developmental needs are
evaluated and addressed. Developing in this instance means
increasing the capacity to perform through training, giving
assignments that introduce new skills or higher levels of
responsibility, improving work processes, or other methods.
Providing employees with training and developmental opportunities
encourages good Operation, strengthens job-related skills and
competencies, and helps employees keep up with changes in the
workplace, such as the introduction of new technology.
Carrying out the processes of Operation management provides an
excellent opportunity to identify developmental needs. During
planning and monitoring of work, deficiencies in Operation become
evident and can be addressed. Areas for improving good Operation
also stand out, and action can be taken to help successful
employees improve even further.
2.11.4. Rating
From time to time, organizations find it useful to summarize
employee Operation. This can be helpful for looking at and
comparing Operation over time or among various employees.
Organizations need to know who their best performers are.
Within the context of formal Operation appraisal requirements,
rating means evaluating employee or group Operation against the
elements and standards in an employee's Operation plan and
assigning a summary rating of record. The rating of record is
assigned according to procedures included in the organization's
appraisal program. It is based on work performed during an entire
appraisal period. The rating of record has a bearing on various
other personnel actions; such as granting within-grade pay
increases and determining additional retention service credit in a
reduction in force.Note: Although group Operation may have an
impact on an employee's summary rating, a rating of record is
assigned only to an individual, not to a group.
2.11.5. Rewarding
In an effective organization, rewards are used well. Rewarding
means recognizing employees, individually and as members of groups,
for their Operation and acknowledging their contributions to the
agency's mission. A basic principle of effective management is that
all behavior is controlled by its consequences. Those consequences
can and should be both formal and informal and both positive and
negative.
Good Operation is recognized without waiting for nominations for
formal awards to be solicited. Recognition is an ongoing, natural
part of day-to-day experience. A lot of the actions that reward
good Operation like saying "Thank you" don't require a specific
regulatory authority. Nonetheless, awards regulations provide a
broad range of forms that more formal rewards can take, such as
cash, time off, and many no monetary items. The regulations also
cover a variety of contributions that can be rewarded, from
suggestions to group accomplishments.
2.12. Managing Operation Effectively
In effective organizations, managers and employees have been
practicing good Operation management naturally all their lives,
executing each key component process well. Goals are set and work
is planned routinely. Progress toward those goals is measured and
employees get feedback. High standards are set, but care is also
taken to develop the skills needed to reach them. Formal and
informal rewards are used to recognize the behavior and results
that accomplish the mission. All five-component processes working
together and supporting each other achieve natural, effective
Operation management.
2.13. Features of a Good Operation Management System
A good staff Operation management system normally consists of
the following features:
Fair and open Objective -The system designed should aim to
facilitate objective and fair assessment by the management and
encourage frank and constructive feedback of appraises. These can
be achieved through: Setting clear targets and standards; Providing
opportunities for supervisors to inform appraises of their
Operation regularly, to be accompanied by timely coaching and
counseling; Permitting the appraise to have access to the entire
report and to review the appraisal before the appraisal interview;
and Where necessary an assessment panel should be formed to ensure
fairness in Operation rating.
Adopting such an open system for staff Operation also supports
the spirit of the Personal Data (Privacy) Ordinance.
2.13.1. Competency-Based
Competency refers to the knowledge, attributes, attitude and
skills required to perform a job effectively. There are two broad
categories of competencies: core competencies and functional
competencies. Core competencies are the generic competencies
associated with effective Operation required by a group of job
holders in a department across different divisions/sections. An
example is managerial competencies required for staff in managerial
positions. Functional competencies are the competencies specific to
certain job functions, such as computer programming skills for
programmers in the Computer Section and classroom skills for
trainers in the Training Division of a department. Competencies are
reflected in a set of desirable behavior patterns which are
observable, measurable and can be tracked and monitored.
Developing and using a competency-based approach enables
departments to use a common language and structured way to define
and describe appropriate job behaviors at different ranks as
officers progress through the grade. The approach help to assess
staff's potential and promo ability to the next higher rank and
identify development needs of the staff. It also enhances the
objectivity and transparency of Operation assessment.
When core competency-based approach is adopted, departments need
to ensure that the competencies are developed properly by :
Aligning individual Operation objectives with departmental ones,
Securing senior management's commitment, and Involving staff in the
process.
Furthermore there should be a clear differentiation in
competency descriptions among different ranks in the same grade. An
unduly long list of competencies may adversely affect the
effectiveness of the system.
For competencies to effectively serve the needs of a department,
they should be department-specific and reflect the missions, values
and culture of the department. Any list of competencies cannot be
exhaustive. It only provides the common language and understanding
of the key dimensions and descriptions that warrant attention.
Upon implementation, there should be proper and adequate
training for the staff on the implementation of the Operation
management system
Operation planning starts with a session between the appraising
officer and the appraisee to agree on the list of
objectives/responsibilities for the coming appraisal period. The
agreed list will include the objectives of the section/unit and the
broad areas of responsibilities of the appraisees, that is key
result areas (KRAs).
2.13.2. A Continuous Process
Staff Operation management cycle is a continuous process which
involves : Operation planning Continuous coaching and development
Interim review Operation appraisal
2.13.3. Operation planning
Operation planning starts with a session between the appraising
officer and the appraise to agree on the list of
objectives/responsibilities for the coming appraisal period. The
agreed list will include the objectives of the section/unit and the
broad areas of responsibilities of the appraises, that is key
result areas (KRAs).
Examples of KRAs are: Timely completion of caseloads Customer
satisfaction and relations Staff development Resource management
Project management
Specific, measurable, achievable and time bound targets will
then be set on the basis of the KRAs. The appraising officer should
ensure that these targets are in alignment with the overall
departmental objectives and that they are clearly understood by the
appraisee.
Depending on the nature of the job, appraising officers may
alternatively agree with appraises a list of key responsibilities
with specific Operation results. This list provides the appraisees
and the appraising officers with the yardstick to objectively
discuss, monitor and assess Operation. The list should be kept
under frequent review and be revised whenever there are changes in
the job.
2.13.4. Continuous coaching and development The Operation
management system is a on-going process. After work targets and
standards have been decided and Operation objectives agreed upon,
the appraising officer should start the coaching and development
process which threads through Operation planning, regular feedback
and guidance, interim reviews and Operation appraisal. Coaching is
about providing regular feedback to staff on their Operation. It
aims at:
Giving recognition to encourage and reinforce good Operation;
and Providing advice and counseling to help improve Operation, and
where appropriate, take corrective action.
Through the coaching sessions, training needs should also be
identified and followed.
2.13.5. Interim review
An interim review is a scheduled, formal discussion between the
appraising officer and the appraisee to review the latter's
progress in meeting the agreed objectives/responsibilities. This
usually takes place in the middle of the appraisal period. An
interim review should take the form of a structured session to
provide an opportunity for additional coaching, for problem
solving, and for updating objectives/responsibilities.
An interim review aims to: Identify Operation results that are
below, on or above target and determine appropriate responses on
corrective measures. Supervisors should use this occasion to
recognize and encourage good Operation. On the other hand,
Operation below targets is to be pointed out and guidance for
improvement to be given; Assess and follow up development or
training need of staff to assist them in achieving their
objectives/responsibilities; Ascertain whether there are potential
problems that may affect the appraisers Operation in the latter
half of the reporting cycle and put in place preventive measures;
and Review whether adjustments to the agreed
objectives/responsibilities are required.
2.13.6. Operation appraisal Operation appraisal is the formal
assessment on the appraisees Operation for the appraisal period. It
covers the following aspects:
How effectively the agreed objectives/responsibilities have been
carried out and targets met; Whether the effectiveness has been
adversely affected by any constraints or obstacles; The strengths
and weaknesses of the appraisee which affected or will affect the
officer's further development; And what sort of personal/career
development and training actions should be taken.
2.13.7. To maintain an open system The appraisee should be shown
the assessment by the appraising and countersigning officers before
the appraisal interview. Countersigning officers are encouraged to
complete the appraisal form before the appraisal interview is
conducted; and An interview record has to be prepared and signed by
both parties.
For training and career development proposals put forward in the
appraisal, the grade management must take the initiative to ensure
any necessary follow up actions are taken in a timely and
appropriate manner. These proposals will also provide useful
reference for the supervisors to develop the staff's competencies.
Common themes on training and development identified should be
consolidated for incorporation into the training and development
plans of t