What is transforming resources in operations management?

Operations management transforms inputs (labor, capital, equipment, land, buildings, materials, and information) into outputs (goods and services) that provide added value to customers. All organizations must strive to maximize the quality of their transformation processes to meet customer needs.

WHAT IS THE TRANSFORMATION PROCESS?

A transformation process is any activity or group of activities that takes one or more inputs, transforms and adds value to them, and provides outputs for customers or clients. ... Changes in the physical characteristics of materials or customers.

HOW OPERATIONS CAN BE VIEWED AS A TRANSFORMATION PROCESS?

Briefly describe how operations can be viewed as a transformation process. Operations is often defined as a transformation process. Inputs such as raw materials, labor, equipment, and capital are transformed into outputs (goods and services). Customer feedback is used to adjust the transformation process.

WHAT IS PROCESS IN OPERATION MANAGEMENT?

Operations management is an area of management concerned with designing and controlling the process of production and redesigning business operations in the production of goods or services. ... Operations produce products, manage quality and creates service.

 EXAMPLE OF AN OUTPUT AND INPUT OF THE TRANSFORMATION PROCESS

Information and materials are two examples of inputs to the transformation process. ... Inputs to the transformation process are tangible, but the outputs may be tangible or intangible.  In general, operations management activities are not information and decision intensive.

WHAT IS THE MAIN OPERATION PROCESS OF THE ORGANIZATION?

Operations management (OM) is the business function responsible for managing the process of creation of goods and services. It involves planning, organizing, coordinating, and controlling all the resources needed to produce a company's goods and services.

FOUR PROCESS STRATEGIES

A process or transformation strategy is an organization's approach to transforming resources into goods and services. These goods or services are organized around a specific activity or process.

Every organization will have one of the four process strategies:

a.    Process focus in a factory; these processes might be departments devoted to welding, grinding, and painting. In an office the processes might be accounts payable, sales, and payroll. In a restaurant, they might be bar, grill, and bakery. The process focuses on low volume, high variety products are also called job shop. These facilities are process focus in terms of equipment, layout, and supervision.

b.    Repetitive focus; falls between the product and process focus. The repetitive process is a product-oriented production process that uses modules. Modules are parts or components of a product previously manufactured or prepared, often in a continuous process. Fast-food firms are an example of repetitive process using modules.

c.     Product focus, are high volume, low variety processes; also called continuous processes. Products such as light bulbs, rolls of paper, beer, and bolts are examples of product process. This type of facility requires a high fixed cost, but low costs. The reward is high facility utilization.

d.    Mass customizations focus; is rapid, low-cost production that caters to constantly changing unique customer desires. This process is not only about variety; it is about making precisely what the customer wants when the customer wants it economically. Achieving mass customization is a challenge that requires sophisticated operational capabilities.

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• inputs
  • transformed resources (materials, information, customers)
  • transforming resources (human resources, facilities)

Transformed resources: resources that will be changed into finished products by operations processes. For example labour, energy, machinery, technology, materials, information. Transformation adds greater value to these resources.

Materials: Raw materials are transformed by manufacturing processes as well as materials which may have undergone some processing already.

Information: it is a transformed resource when it is used to inform how inputs are used, where they are drawn from, which suppliers and supplies are available.

Customers: Production process is usually not complete until the customer has been transformed. It is the customer’s needs that drive the operations.

Customer relationship management (CRM): the ways that businesses maintain customer contact.

Transforming resources: The inputs (resources) that cause the transformation process.

• Human Resources: the people (employees) who will be the key to the transformation process.
• Facilities: the buildings, plant, equipment and fittings that are essential to the business achieving its core function; producing its output.

Extract from Business Studies Stage 6 Syllabus. © 2010 Board of Studies NSW.

Some inputs are used up in the process of creating goods or services; others play a part in the creation process but are not used up. To distinguish between these, input resources are usually classified as:

• transformed resources – those that are transformed in some way by the operation to produce the goods or services that are its outputs

• transforming resources – those that are used to perform the transformation process.

Inputs include different types of both transformed and transforming resources.

Three types of resource that may be transformed in operations are:

• materials – the physical inputs to the process

• information that is being processed or used in the process

• customers – the people who are transformed in some way.

Many people think of operations as being mainly about the transformation of materials or components into finished products, as when limestone and sand are transformed into glass or an automobile is assembled from its various parts. But all organisations that produce goods or services transform resources: many are concerned mainly with the transformation of information (for example, consultancy firms or accountants) or the transformation of customers (for example, hairdressing or hospitals).

Galloway (1998) defines operations as all the activities concerned with the transformation of materials, information or customers.

The two types of transforming resource are:

• staff – the people involved directly in the transformation process or supporting it

• facilities – land, buildings, machines and equipment.

The staff involved in the transformation process may include both people who are directly employed by the organisation and those contracted to supply services to it. They are sometimes described as ‘labour’. The facilities of an organisation – including buildings, machinery and equipment – are sometimes referred to as ‘capital’. Operations vary greatly in the mix of labour and capital that make up their inputs. Highly automated operations depend largely on capital; others rely mainly on labour.

Identify the principal inputs (both transformed and transforming resources) used by each of the following organisations, and their principal outputs.

The transformed resources of a restaurant include food and drink, and its transforming resources include equipment such as cookers, refrigerators, tables and chairs, and the chefs and waiters. In a university, the transformed resources include students and knowledge and the transforming resources include lecturers, tutors and support staff, as well as classrooms, books and instructional materials.