Operations management is one of the central organizational functions, irrespectively of the field in which the company operations, producing goods or services. One of the most complex and, at the same time, intuitive concept in operations management is the transformation process, where the inputs turn into outputs and are delivered to the clients (Maagretta 1998).
It is evident that transformation process is extremely important for the companies and it is influenced by a number of internal and external factors. An example of the waste recycling process demonstrates the relationships of the transformation process and tactical and strategic organizational levels and outlines the range of milestones, which should be considered for successful operation. This document aims to demonstrate this relationship on the examples and with the analysis of the secondary sources.
Key words: transformation process, transformable resources, transformation resources, operations management.
Usefulness of Transformation Process in Operations
Operations management process is the process of production and delivery of the goods and services to the final customer. It is not a secret that management of all level operational and tactical processes will continue remaining in the focus of organizational high-level strategies as the operational excellence is the ultimate goal of any company (Kaplan & Norton 2003; Whetten & Cameron 2010). While there are three levels of control, strategic, operational and tactical, the importance of the transformation process is seen at all of these levels. The objective of this essay is to look at the process of transformation and explore its relationships with the strategic, tactical and operational levels in the company. This research is done with the application of specific examples and the real-life situations for better comprehension and illustration of the transformation process and the above links.
One can argue the transformation process is “any activity or group of activities that take one or more inputs, transforms and add value to them and provides outputs for customers or clients.” When it comes to the analysis of the production of the goods with the utilization of raw material, the process of transformation is relatively easy to comprehend. The types of the transformation process include changes physical characteristics of the products, location and informational change and ownership of the goods. Moreover, transformation process can also involve the change in storage or accommodation of materials, purpose and the use of information and, even the change in psychological state of the customer, as an example (Mahadevan, 2010). With the above in mind, it is possible to outline three major input elements in the transformation process – material, information and people (customers). Our daily life provides numerous examples of the transformation process. One of the exemplary situations is the financial transaction or even the withdrawal operation of cash from the bank machine, where information is used to get the data about the bank account, material, such as cash or cheese is the final deliverable and individual, the customer, is the critical element of the transformation process. In other situations, however, the transformation involves two or less inputs, such as in the process of orange juice production at the automatic machines at the convenience store, where the input are oranges and the output is the juice itself with the utilization of juice squeezer as the unique intermediate resource. That said, the transformation process can be categorized in many ways. Naresh (2005) recognizes four major types of the transformation process: transport, supply, manufacture and service. Transport is physical movement of materials. Manufacture is the process of creation, supply outlines the change in ownership and service is the provision of non-material elements, such as treatment of customers and storage of materials.
All the inputs in the process of transformation can be divided into transformation and transformable resources. As a simple as it may sound, transformable resources are the ones that are treated, converted or transformed in the process. Transformation resources, on the other hand, act and carry out the process of transformation itself. Looking first at the transformable resources, it is possible to outline three major groups: materials, information and customers (Lesuere 2010).
Another set of resources is transforming. An insight into this group allows identifying two major types of transforming resources: facilities and staff. Facilities include buildings, plants, equipment and technology involved in the operations process. It is evident that each operation is very different and, thus, transforming resources and their nature will differ from operation to operation. As such, staff, involved in car assembly operations will possess very specific skills in engineering and operations, while a bread factory employee will demand completely different knowledge (Steekamp & Van Schoor 2011).
For the purpose of this work, it was decided to look at transformation process in Natural Resources Sector and the waste management process. Looking at the municipal solid waste the transformation process involves waste collection, recycling factory sorting operation for recyclable and non-recyclable waste. For the first category, the process ends with utilization of plastic and other materials that are later used by final consumers. For non-recyclable waste, the process ends with the transformation into cement after removing the materials, which can form dioxin. Transformable resources in this situation include the waste itself, information about the collection and recycling facilities, chemical data and other relevant information, which enables the above-mentioned process (Pycraft, Singh & Phihlela 2000). Customer is also a transformable resource, as he is influenced physically, by changing his habits in waste collection and utilization of plastic and paper. Transforming resources include the staff that works on logistics and recycling plant operation, as an example and facilities, such as a recycling plant, cement production equipment, trucks for waste collection and other components of the process. The above example illustrates the complexity and number of transformable and transforming resources involved in a single Natural Resources Sector operation (Klassen & Menor 2006; Buclet 2002).
Basset (1992) argues that the tactical level is there the actual work is done. Indeed, while strategy sets the vision and mission and looks at where the company should head and how it should be done, tactical level managers are responsible for the development of specific steps, needed to achieve the vision and mission, outlined in corporate strategy. One of the examples, which was used above is the hospital and patient treatment operation. Taking the same example for convenience, the transformation process on the strategic level is outlined as accept the patient for treatment, conduct the treatment with the objective to cure the disease and set the patient free. Tactical steps in this process are numerous, and each of the strategic and operational level milestones will be split in various tactical elements (Langabeer 2008). As such treatment can include analysis and identification of disease, prescription of treatment, receiving agreement from the patient´s family, conducting daily treatment and many other tactics.
There are several conclusions, which can be driven from the above with regards to the relationships between the transformation process and organizational levels. First of all, strategic level should always come first. As it outlines the high-level vision and mission of the company, it also sets the scope and scale of the operations and potential direction of tactical level development. In fact, it is not possible to have cash on your hands, without building on the strategy to take it from the cash machine. Similarly, the company cannot build effective operation without understanding where it would like to be in five or even ten years from now.
Basset G. (1992). Operations Management for Service Industries: Competing in the Service Era. Westport, CA: Quorum Books. Print.
Buclet N. (2002). Municipal Waste Management in Europe. Dordrecht, NL: Kluwer Academic Publishers. Print.
Kaplan R. and Norton D. (2003). Operations Management Process. Harvard Business Review [Online]. Available at: http://hbr.org/product/operations-management-processes/an/1577BC-PDF-ENG
Klassen R.D. and Menor L.J. (2006). Cases in Operations Management. Building Customer Value Through World-Class Operations. London, UK: Sage Publications. Print.
Klassen R.D. and Menor L.J. (2006). Cases in Operations Management: Building Customer Value Through World-Class Operations. London, UK: Sage Publications. Print.
Langabeer J. (2008). Health Care Operations Management: A Quantitative Approach to Business and Logistics. London, UK: Jones and Bartlett Publishers. Print.
Leseure M. (2010). Key Concepts of Operations Management. London, UK: Sage Publications. Print.
Magretta J (1998). Fast, Global, and Entrepreneurial: Supply Chain Management, Hong Kong Style. Harvard Business Review. Interview With Victor Fung. Available at: http://hbr.org/1998/09/fast-global-and-entrepreneurial-supply-chain-management-hong-kong-style/ar/1
Mahadevan (2010). Operations Management: Theory and Practice. 2nd Edition. New Delhi, IN: Dorling Kindersley. Print.
Naresh Roy R. (2005). A Modern Approach to Operations Management’, Lanham: new Age International Publishers. Print.
Nersessian R.L. (2000). Trends and Tools for Operations Management: An Updated Guide for Executives. Westport, CT: Quorum Books. Print.
Pycraft M., Singh H., and Phihlela K. (2000). Operations Management. Cape Town, SA: Pearson Education. Print.
Slack N, Chambers S. and Johnson R. (2007). Operations Management. New York, NY: Prentice Hall/Financial Times. Print.
Steekamp R and Van Schoor J (2011). The Quest for Quality of Work Life: A TQM Approach. Lansdowne, NY: Juta Education. Print.
Whetten, D A and Cameron, K S (2011) Developing Management skills, Saddle River: Pearson education. Print.