Operations management mistakes are nearly always costly. A mistake in operations management could have wide-ranging consequences. Some mistakes are worse than others, and some mistakes will absolutely end a business.
This is especially true when it comes to schedules and costs. Operations management is all about efficiency. The best operations managers know how to plan, organize, and supervise production to ensure the fastest and best products and services.
Whether you are an operations manager or hope to hire one, listed below are eight common operations management mistakes you don’t want your company to suffer.
1. Neglecting to Document Existing Processes
Operations managers (OMs) are tasked with improving business processes. This entails observing and understanding the processes as they are. Once new processes are put in place, OMs need to compare the new system against the old one to verify that they have made improvements. Without that initial documentation, there is no telling whether an OM is doing a good job or not. This mistake could waste company resources for months or even years.
2. Failing to Record Objectives
It’s important that companies and OMs state business goals clearly. They need to document objectives from the earliest stages of a project to ensure that everyone understands the intended outcome. If necessary, key terms should be defined to prevent misunderstandings or miscommunications. This will keep an OM on task and reduce the likelihood of costly deviations from the plan.
3. Lacking Key Performance Metrics
Speaking of setting goals, no goal is sufficient if it doesn’t include at least one metric. Performance metrics allow OMs to verify that their efforts have a positive effect. All metrics should be quantitative and relevant. The best metrics are easy to obtain.
Some examples of typical OM metrics include:
- the time an operation takes to complete a task;
- the time needed for one product to complete its processes start to finish;
- the quantity of inventory in the process;
- the consistency of an operation; and
- the conformity of a product to stated standards.
4. Choosing Not to Standardize Processes
Standardizing processes is one of the more important steps toward improving efficiency. This is especially true when a business has multiple production centers for the same products. Standardization helps to ensure a universal quality in products and services. The best spend plenty of time covering standardization because it is so important in an OM’s toolkit.
5. Over-Complicating Processes
Any operation is much more prone to mistakes when the processes involved are complex. An OM needs to take advantage of opportunities to simplify. They also need to resist the temptation to overthink when it comes to designing new processes.
A few good indications that a process is overly complicated would be the statement “We’ve always done it that way” or an inability to describe a process in detail. OMs who fail to identify and rectify overcomplicated processes — or worse, OMs who develop brand-new processes that are too complex — will waste company time and money.
6. Overlooking the Bottleneck
A bottleneck is a resource with the smallest capacity. This typically results in limited production. There may be no eliminating the bottleneck entirely, but being able to identify it is key. Spotting bottlenecks helps businesses keep them from negatively affecting production and quality.
Unfortunately, some OMs don’t bother looking for the bottleneck. Sometimes they can misidentify it, leaving the true bottleneck to wreak havoc on production.
7. Automating Wantonly
Oftentimes, automation reduces expenses, cuts downtime, and provides other noteworthy positives. Other times, automation cements bad processes, resulting in all sorts of wasted resources.
It’s tempting to use all digital tools available, especially those that seem to eliminate inefficiencies and cut costs as most automation services claim to do. Before using an enterprise management system to automate processes, OMs need to be careful to weed out any bad processes that could cause inefficiencies. It might be useful to enroll in operations management courses. These courses focus on digital strategy, which will guide OMs in selecting beneficial software and automation tools.
8. Forgetting About the Customer
Finally, the customer is the most important element of any business plan or process. The customer gets to decide the appropriate quality for products or services, not the OM.
OMs who ignore customer behavior are simply not doing their job correctly. OMs need to focus their performance metrics on customer preferences. After that, they need to align processes with product development and marketing. This helps to ensure customers are getting exactly what they want.
Remain Alert to Operations Management Mistakes
Mistakes are inefficient, which is why operations managers should do everything they can to avoid them. By recognizing the most devastating mistakes in operations management, OMs and businesses alike can avoid catastrophe and find success.