Production and the Organization

Production is of vital importance to any organization. This is because every organization is engaged in production of either a physical good or service. The survival of any organization rests on its ability to produce something for which there is a demand. Production is the foundation on which every organization is built.


Unfortunately, production and operations management has often been associated only with manufactured goods. However, in recent years, the area has been expanded to include such activities as purchasing, transportation and other operations from procurement of raw materials through various activities until a product is available to the buyer.
 
Indeed, POM traces its roots to "Production Management" or "Factory Management". Yet the addition of the term "Operations" signifies that many concepts originally developed for the factory apply equally well to non-profit making organizations, service firms, and government agencies.

The term `products' is used, here, to refer to a manufactured good or service. Food items, cars, books and furniture are all products. So too, are haircuts, sporting events and training programs.

With services taking a major portion of business activities these days, it is important that principles and practices proven beneficial in manufacturing be used to make the delivery of services more effective and efficient. This will be more challenging because of the intangible nature of the services, but the potential benefits make the effort all the more worthwhile.