To enable the Operations manager to make good decisions, there is a need for long term forecasts (more than 5 years) and short-term sales forecasts (12 moths)
Long -term market forecast - is usually outside the purview of the Operations. The forecast of carried out by Marketing staff and backed by economic, political, social and technological data. The forecast may take the form of a statement of anticipated output in volume and monetary form. It is from this forecast that the organization must contemplate capital expenditures such as erecting new buildings to support increased volumes or changing out equipment owing to obsolescence of current technologies.
Short-term sales forecast - is the basis from which much of the transformation activity stems. It is a prediction covering the next budget period (usually 12 months) of:
-Products/services to be sold (detailed breakdown)
-The prices which the market can bear
-Quantity, quality and reliability expectations of each product
-Required delivery dates
While recognizing the POM is a system within a system, it is worthwhile to reiterate that this function has characteristics that distinguish itself from other functions within the organization.
POM employs the bulk of the staff, utilizes the bulk of physical assets, requires the bulk of financial resources and is made of many sub-systems in the organization. Thus, there is a need to develop and operate POM management system. The task is never easy, as it has to deal with multi-faceted functions within the organization.
A proposal to help develop a system for POM is to combine the four considerations (strength and weakness of the enterprise, opportunities and threats offered to the enterprises) and the five Ps (product, plant, processes, programs and people).
The Operations managers' job is both exciting and challenging. On a daily basis, he or...