​IB BUSINESS MANAGEMENT: 
​​UNIT 5 – Operations management

Operations Management (also referred to as Production) in IB Business Management is one of the five core topics and is assessed in both Paper 1 and Paper 2 SL and HL examinations. Operations is the management task that is concerned with supervising, designing and controlling the procedures of the production process. It is an area of management concerned with designing and controlling the process of production and redesigning business operations in the production of goods or services. It is closely involved in all aspects of the production process.

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The IB Business and Management Marketing unit covers the following topics:

• 5.1 Introduction to operations management
• 5.2 Operations methods
• 5.3 Lean production and quality management HL
• 5.4 Location
• 5.5 Break-even analysis
• 5.6 Production planning HL
• 5.7 Crisis management and contingency planning HL
• 5.8 Research and development HL
• 5.7 Management information systems HL

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Operations management (Production)

Operations management is concerned with supervising, designing and controlling the procedures of the production process. It is closely involved in all aspects of the production process which is why the term operations management is used interchangeably with that of 'production'. In addition, operations management is involved in the redesign of the business operations that have as their centre of focus, the production of goods and/or the provision of services. Operations management is concerned with the responsibility of guaranteeing that business operations are efficient in that the processes are using as few resources as needed, and are effective in terms of meeting customer requirements. Finally, operations management is concerned with managing the process that converts inputs (in the forms of materials, labour, and energy) into outputs (in the forms of goods and/or services).   

That is operations management?

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Operations in IB Business Management

The IB Business Management course Operations Management topic aims to give the student a good overview of:

• The different methods of production, including an examination of capital and labour intensive production processes.
• The different costs that are incurred by firms, the revenues accrued and the contribution made towards fixed costs and profits on a per product basis.
• When a firm may expect to break-even and how much of a margin of safety is built into current production targets, as well as profit targets.
• The importance of quality and the process of quality assurance, lean production methods and Kaizen processes
• The quantitative and qualitative factors that influence location decisions, including the impact of globalisation on production centres.
• Types, costs, benefits and goals of innovation and research & development, and how innovations can be protected through intellectual property rights
• Stock control processes in production planning, with emphasis on capacity utilisation, outsourcing and subcontracting and make-or-buy decisions.
• The use of management information systems in planning, designing and implementing project management.

Operations management explained

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