3. Key Elements of the Operations System

Question 1

KEY ELEMENTS OF THE OPERATIONS SYSTEM

INTRO?

Answer 1

The operations system can be defined as the part of an organisation that produces its goods and services by processing inputs to achieve desired outputs. There are three key elements in an operations system: inputs; processes; outputs. All operations systems take inputs and process them to make outputs. The three key elements are essential when considering operations management.

Question 2

Inputs?

Answer 2

Inputs are the resources that are necessary to make the product; or the ingredients required to produce the good or service. These can include raw materials, human skills and effort, facilities, equipment and machinery that go into the production process.

Inputs that are typical in an operations system are:
 human skills and effort
 raw materials (e.g. water, trees, metals, oil, electricity)
 facilities (e.g. factories, office buildings, restaurants, hospitals)
 machinery and equipment (e.g. computers, robots, trucks, X-ray equipment).

Question 3

Processes?

Answer 3

Processes refer to the actions performed on the inputs to transform them into the finished product. In other words, they include all the methods used by organizations to transform inputs into outputs.

• Processes include transformation or conversion activities

• Operations manager plans it then organises its implementation.
• Lead others and control.

• Operations process and systems will vary according to the type of goods and services being produced.

Question 4

Outputs?

Answer 4

Outputs refer to the finished products; which can be goods or services. In other words, the outputs are the end product/result of the operations process.
• The finished goods and services at the end of the production process.
• Must be responsive to the needs of the market.
• Feedback on efficiency and effectiveness must be sought.
• Environmental factors must be taken into consideration.

Question 5

OTHER DEFINITIONS?

Manufacture?

Service?

Outsourcing?

Answer 5

Manufacture – The production of a tangible product as a result of processing, components and raw materials.

Service – The production of a task on behalf of or to help a customer making use of skill, effort or creativity.

Outsourcing – The strategy of contracting a stage of the production process to an outside specialist organization.