Areas Where Operations Management Is Likely Failing in Your Organization

Addressing poorly performing operations requires management initiative that is proactive rather than reactive and pursues a dedication to quality, productivity and unit costs.

As these three pillars are crucial to the success of operations management, they also become susceptible to several key challenges.

The role of an Operations Manager is to limit the variances in the process, as well as to have the ability to think ahead.

Nevertheless, among my clients viewed as best-in-class, I consistently encounter four major management traits: meaningful metrics, clear communication of expectations, firm understanding and control of unit costs, fairness in the dealings with staff.

Meaningful Metrics

The first requirement of meaningful metrics is the sharing of common definitions and understanding of key metrics and their components.

All staff, supervisors and managers understand the source, operational value, meaning and relationship of individual metrics to the overall business objectives.

Metrics are collected and reviewed on a daily basis. Variations to standards are quickly categorized as common or assignable. Assignable variations are quickly investigated and corrective actions taken.

Clear Communications

Best-in-Class operations display a unique knack for clear communications.

Not only in the definition of standards, service level agreements, and performance but also in expectations and a common operational mindset.

This is obvious at all grade levels and positions within the processing area. There is a shared understanding of purpose over the process.

And a clear understanding of production and quality expectations. Correction and praise are quickly and regularly communicated. There is a clear definition of failure and consequences.

Unit Costs

The best measure of operational efficiency is the unit cost of the process.

Best-in-Class managers can maintain a relatively consistent unit cost through accurate forecasting and management of fluctuations in daily staffing levels (due to absenteeism, vacations or attrition), fluctuations in processing volume and performance.

These managers understand the interdependence of the key components of unit cost and that the percentage mix of the key components changes with regular frequency.

Managers prepare for and know how to react to these changes to deliver a consistent unit cost.

Fairness

Fairness not only applies to the management and evaluation of staff but also to the opportunity for advancement and promotion.

The evaluation process is based on the qualitative rather than the subjective.

Clear understanding exists by both staff and management of exact definition between two levels of evaluation (On a 1 to 10 scale the difference between a 6 and a 7)

The second component of fairness is providing all staff with a clear definition of the exact and quantifiable tasks that must be mastered or demonstrated to be eligible for promotion.

Combined with this definition is the provided opportunity for each staff member to learn the required tasks. The operational culture is one of promotion of continuous improvement in operations and the individual.

Are these key management traits readily apparent in your operation? Which one poses your greatest management challenge? Share your thoughts and let’s create a dialogue in the comments below!

Learn more at FTPConsulting.com.

 

Summary
Article Name
Areas Where Operations Management Is Likely Failing in Your Organization
Description
The role of an Operations Manager is to create stability within an organization. There are four major trends to failing operations management: internal practices, sustainability, reporting and accountability.
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