Production Management Case

What is the difference between the terms "production management" and "operations management"?

Operations management and production management are essentially one in the same. Both play an important role in an organization of increasing the efficiency and productivity of a product and/or service. Production management is used when the result is a physical product. The term operations management is used when the output from a business is a service.

Operations management is focused on the administration, planning and execution of operations that involve production of goods. When services are provided, the function is called production. Thus, the production management is focused on the administration, planning, and execution of operations that involve the production of services. Operation management aims to minimize costly resources while increasing output for sales. Production management is more concerned with the input/output and churning out products (or services) in the shape of desired finished product. One could say that production management is engaged with the manufacturing of a business' product and/or service while operations management is focused on sales and sales related tasks.

5. How does the function of an operating manager differ from the function of a marketing manager or a finance manager? How are these functions similar?

The operation manager's function is responsible for the production of goods and/or services provided from a business. The focus for the operation manager is to generate supply. However, the operation manager cannot do this alone. The operation function relies on the marketing manager to be responsible for creating demand and generating sales revenue. Without sales revenue, the operation manager does not have the resources to continue the production of the business' goods and/or services. Both the marketing managers and the operation managers look to the finance manager for the acquisition and allocation of all capital for the business.

These three functions are weak alone because each manager is in some form or fashion dependent on the next functional area. For example in a restaurant, the operation manager does not know how many beef tacos, chicken tacos, or pork tacos to produce without knowing from the marketing manager the sales revenue. Which one should the operations buy more of to sell? The marketing manager has the answer. The finance manager can tell the operations and the marketing managers how much profit the restaurant is making on each taco. Together, the three functions can determine if they need more beef, chicken, or pork tacos.