Operations Management

AAA

DEFINITION of 'Operations Management'

Operations management refers to the administration of business practices to create the highest level of efficiency possible within an organization. Operations management is concerned with converting materials and labor into goods and services as efficiently as possible to maximize the profit of an organization.

INVESTOPEDIA EXPLAINS 'Operations Management'

Operations management teams design the method of conversion of inputs (materials, labor, proprietary information, etc.) into outputs (goods, services, value-added products, etc.) that is most beneficial to the organization. Operations management teams attempt to balance costs with revenue to achieve the highest net operating profit possible.

RELATED TERMS
  1. Aged Assets

    Equipment that has outlived its useful life. Aged assets might ...
  2. Strategic Gap Analysis

    The evaluation of the difference between a desired outcome and ...
  3. Operating Revenue

    Income derived from sources related to a company's everyday business ...
  4. Operating Expense

    A category of expenditure that a business incurs as a result ...
  5. Profit

    A financial benefit that is realized when the amount of revenue ...
  6. Business

    1. An organization or enterprising entity engaged in commercial, ...
Related Articles
  1. A Look At Corporate Profit Margins
    Markets

    A Look At Corporate Profit Margins

  2. The Essentials Of Corporate Cash Flow ...
    Retirement

    The Essentials Of Corporate Cash Flow ...

  3. What Is A Cash Flow Statement?
    Markets

    What Is A Cash Flow Statement?

  4. Payroll Deductions Pay Off
    Retirement

    Payroll Deductions Pay Off

comments powered by Disqus
Hot Definitions
  1. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  2. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  5. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  6. Budget Deficit

    A status of financial health in which expenditures exceed revenue. The term "budget deficit" is most commonly used to refer ...
Trading Center