What is supply chain: Definition, models, challenges
Supply chain is having an ongoing moment. Discover the trends, models, challenges, and requirements of modern supply and demand.
Effective operations management is core to business success, but traditionally has run in the background without a lot of fanfare. That’s not the case these days.
Ongoing disruption to the global supply chain and the growing need for business agility have put the spotlight squarely on operations managers.
Companies are reexamining and rethinking their processes to improve efficiency so they can navigate constant change and put their business on solid footing. They’re leaning on operations managers to get it right.
Every business, no matter the size or industry, needs effective operations management to drive profitability, achieve long-term success, and win competitive advantage.
Operations management is the planning, organizing, and oversight of business practices that maximize efficiency and assure company processes are driving value. It involves preparing and supervising the practices that turn resources such as labor, equipment, and raw materials into goods and services.
Operations managers work to ensure a company achieves the highest operating profit by carefully balancing cost and revenue. They work closely with other teams to increase productivity, deliver high-quality products and services, and ensure customers are satisfied.
Large organizations usually have a chief operations officer (COO) while smaller businesses might assign the duties to another high-level role. Either way, it’s a highly strategic position involving strong planning, organizational, and communication skills.
Operations management is closely associated with supply chain management: Managing the process of sourcing material, turning it into product, and delivering it to customers.
Leadership and people management are also central to effective operations management. While systems and processes are key, success often hinges on the ability of operations managers to motivate cross-functional teams, foster collaboration, and maintain a culture of continuous improvement. By prioritizing communication and engagement, operations managers can ensure both people and processes work together to achieve business goals.
Supply chain is having an ongoing moment. Discover the trends, models, challenges, and requirements of modern supply and demand.
There are many types, or aspects, of operations management. An operations manager role can vary widely, depending on business size and industry. They might have a broad range of responsibilities or focus on one area.
Functions related to managing operations also can be broken down as strategic or tactical; the tactical functions carry out the overarching strategies or goals.
Whether they’re driving product design, managing capacity, or ensuring quality, operations managers must also consider risk management at each step. For example, proactive planning for supply chain disruptions—such as raw material shortages, transportation delays, or sudden demand spikes—helps businesses remain agile. By accounting for potential risks in every aspect of operations, companies can maintain reliable processes and protect customer satisfaction.
Closed-loop production systems drive sustainability across the entire supply chain by eliminating waste and clearing the path for a circular economy.
Across all these industries, new technologies and future trends are transforming traditional processes. The rise of advanced analytics, automation tools, and cloud-based platforms enables faster, data-driven decisions. Whether it’s using AI-assisted diagnostics in healthcare, implementing predictive maintenance in manufacturing, or adopting real-time delivery tracking in transportation, these innovations help organizations stay efficient, scalable, and ready for the demands of a rapidly evolving market.
Here are 4 maintenance KPIs field service managers should use to avoid downtime and damages from faulty machinery.
In smaller companies, an operation manager’s responsibilities may include supply chain functions like managing the processes and systems for sourcing and delivery.
Supply chain managers work with suppliers to collect materials, oversee manufacturing of product, and delivery to customers. They evaluate suppliers and negotiate contracts, assess supply chain risks, manage purchasing, and oversee logistics. By comparison, operations managers may be focused more on internal production processes.
Strong supply chain management is critical for increasing efficiency, reducing costs, improving customer satisfaction, and driving revenue for a company.
Today, technology and automation play key roles in managing supply chain complexity. AI-driven demand forecasting, real-time shipment tracking, and automated warehouse systems help supply chain managers detect potential bottlenecks and optimize routes. Operations managers leverage these same innovations to coordinate internal workflows, quickly adjust production schedules, and ensure alignment with shifting market demands. This interconnected use of technology underpins an agile, efficient supply chain ecosystem.
Additionally, risk management is front and center as supply chains grow more global. From natural disasters to geopolitical tensions, disruptions can occur at any point in the chain. By integrating contingency planning—such as backup suppliers, diversified shipping routes, or safety stock strategies—operations managers and supply chain managers alike can minimize potential impacts, maintain business continuity, and protect the customer experience.
With an intelligent ERP, a company can embark on a digital transformation strategy to set them up for the future of business – in five steps.
Effective business transformation starts by empathizing with the end user to learn their true needs and then applying technology.
Effective operations management isn’t just about day-to-day efficiency; it also draws on established frameworks and methodologies that have shaped best practices over time. These approaches offer structured ways to eliminate waste, reduce defects, and continuously enhance processes.
Originating from the Toyota Production System, Lean focuses on identifying and eliminating waste (anything that does not add value to the customer). By streamlining workflows and optimizing resource use, Lean principles can significantly improve quality and speed. In modern operations management, Lean methods are often combined with digital tools, allowing teams to visualize and address inefficiencies in real-time.
Developed at Motorola and popularized by companies like General Electric, Six Sigma targets process variation that leads to defects. Using data-driven techniques and statistical analysis (DMAIC: Define, Measure, Analyze, Improve, Control), it aims to minimize errors to near-zero levels. Six Sigma continues to influence many industries today, helping operations managers maintain rigorous standards and predictable outcomes.
Rooted in the work of quality pioneers such as W. Edwards Deming, TQM (Total Quality Management) emphasizes an organization-wide commitment to quality, continuous improvement, and customer satisfaction. By involving every level of the workforce in the quality process, TQM fosters a culture of shared responsibility—a concept that aligns well with today’s collaborative, cross-functional teams.
A core Japanese business philosophy that translates to “change for the better,” Kaizen advocates for small, continuous improvements rather than sweeping, periodic changes. This incremental approach can help organizations adapt more smoothly to shifting market conditions. Modern operations managers often embed Kaizen events or workshops into their routines to keep teams focused on constant progress.
Over the decades, these methodologies have merged with emerging technologies—like real-time analytics, machine learning, and automation—leading to more precise measurements and faster iterations. Whether focusing on reducing defects, cutting waste, or boosting quality, these frameworks guide operations managers in establishing the culture, processes, and metrics that drive sustainable improvements. By blending time-tested principles with new digital capabilities, businesses can stay resilient in a constantly evolving market.
Learn how an experience management solution collects customer feedback and translates this feedback into powerful metrics for the business.
For operations managers, metrics and key performance indicators (KPIs) are essential for gauging efficiency, spotting bottlenecks, and driving continuous improvement. By tracking and analyzing concrete data, businesses can make informed decisions and quickly adapt to market shifts or internal challenges.
Operational metrics don’t exist in a vacuum; they closely tie to financial outcomes such as ROI, cost reduction, and profit margins. For instance, minimizing lead time can lower holding costs and improve cash flow, while higher inventory turnover often translates to better use of working capital. By understanding how each KPI affects the bottom line, operations managers can prioritize improvements that yield tangible business impact.
As businesses become increasingly reliant on technology, data-driven approaches are more accessible and powerful than ever. Modern analytics tools can offer real-time visibility into metrics, helping managers spot trends and anomalies quickly. This ability to analyze performance in real time accelerates decision-making and reduces guesswork. When combined with predictive analytics and machine learning, data-driven operations management becomes a continuous feedback loop—one that allows businesses to stay agile, maintain high product or service quality, and meet evolving customer expectations.
The way a business manages its processes is directly linked to the customer experience it provides.
When a company delivers quality products and services to customers in a timely manner, customer satisfaction soars. In contrast, a delayed or wrong order will damage CX and drive customers to the competition.
Customers want their wishes met, on time and at a good price. They expect brands to live up to their promises and deliver products as advertised. This requires understanding what customers want and need, and using that to inform operations management. Listen to their feedback to adjust processes as needed.
Looking ahead, future trends in consumer behavior—including demand for real-time tracking, personalized experiences, and environmentally responsible practices—are reshaping how companies think about customer experience. By integrating advanced analytics and transparent supply chain capabilities, operations managers can stay agile and respond to these emerging demands, ensuring that every aspect of the customer journey meets or exceeds expectations.
Customer experience isn’t just about front-end touch points; it requires integration with back-end operations such as inventory and fulfillment in order to really shine.
According to a McKinsey report, companies can spot operational improvements that will improve CX by analyzing customer journeys. For example, one bank looked at how customer satisfaction was impacted by how long it took to apply for an account and receive an account card.
Understanding breaking points can help businesses zero in on operational improvements that will boost CX, researchers said. Implementing those improvements could involve advanced analytics, intelligent process automation, and/or a lean approach.
Departmental silos lead to inefficiencies, reduced productivity, and lower morale. Find out how to put an end to silos and increase efficiency.
Effective operations management doesn’t happen in a vacuum. It needs to be tightly interwoven with the broader strategy of the organization to ensure that operational goals support the company’s vision and objectives. Whether the corporate strategy centers on rapid growth, product innovation, or market expansion, aligning operational processes accordingly helps maintain consistency and clarity across all levels of the business.
Operations managers often find themselves collaborating with finance, marketing, R&D, and other departments to develop cohesive initiatives. For instance, finance teams may offer insights into cost management and budgeting, while marketing provides demand projections and customer feedback that inform production volumes. By building these relationships, operations managers gain a holistic view of the organization’s priorities and can adjust workflows to balance financial constraints, product roadmaps, and customer requirements.
One of the biggest challenges in any organization is the tendency for departments to work in isolation. Silos can lead to misaligned objectives, duplication of effort, and delayed decision-making. Operations managers play a crucial role in uniting diverse teams, ensuring that communication flows freely and everyone understands how their responsibilities fit into the bigger picture. This cross-functional alignment encourages shared ownership of results and fosters a culture where teams proactively collaborate on everything from product launches to process improvements.
By integrating operations management with corporate strategy and actively working to bridge departmental silos, companies can create a more agile, efficient environment. Aligning people, processes, technology, and resources around common goals not only enhances day-to-day operations but also positions the business for long-term resilience and success.
Business agility requires great customer data management. Understand customers with a single, enterprise-wide view of data to pivot on a dime.
Satisfied customers prove that your operations and processes are doing what they’re supposed to: deliver value.
Effective operations management has become more vital than ever as businesses navigate ongoing disruptions and evolving market conditions. From supply chain disruptions to evolving customer expectations, companies that excel operationally can adapt quickly, maintain quality, and protect their brand reputation.
Achieving operational excellence requires a holistic approach—integrating everything from the right methodologies and KPIs to a clear strategic focus and cohesive cross-functional teamwork. By continuously refining processes, embracing new technologies, and keeping the workforce aligned with organizational goals, businesses can avoid stagnation and remain prepared for whatever challenges arise.
Only with the best planning and oversight of its myriad processes can a business remain resilient, achieve its long-term goals, and outlast the competition. Through deliberate, ongoing improvement efforts, operations managers help ensure that organizational performance consistently supports customer satisfaction, revenue growth, and sustainable success.