What is the difference between project management and operation management?

Project Management is managing a project with a definite objectives, activities, budget, and expected output. A project has a definite start time and closing time i.e. implementation time is fixed. After completion of project, the personnel are terminated as per terms of contract and the entire project is handed over to another entity or parent entity for operation. 

Operation Management has very diverse meaning. In some non-profit organizations, operations is group of support services like Admin, Human Resources, Finance, Information Technology and even procurement.   

In profit making company, Operations is the core business and sometimes called production department.  Operations in profit making companies include product design, production planning, process selection, facilities design and layout, supply chain and actual production. This concept may vary from industry to industry or even within the industry.  Operations is a permanent set up and continues to produce and supply goods to the customer.    

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Concepts 

Operations Management is an ongoing organizational function that performs activities to produce products or supply services. For instance, production operations, manufacturing, IT service management, and accounting operations. Furthermore, operations are permanent endeavors that produce repetitive outputs. Resources are assigned to do the same tasks according to operating procedures and policy. In contrast, projects management are temporary and help the business to meet organizational goals and to respond quickly and easily to the external environment. Organizations use projects to change operations, products and services to meet business need, gain competitive advantage and respond to new markets.

The Key differences  between Operations Management and project management are as follow:

1-Different Objectives

Projects require project management whereas operations requires business process management or operations management. However, projects and operations do meet at various points during the life-cycle of a product or service. For example when:

·         Re-engineering business processes,

·         Developing or changing product and services, and

·         Improving operations or product development.

2- Different goals

The goal of process management is to improve processes continually. Improving operational processes may increase effectiveness, cut costs and gain competitive advantage.

Projects are about driving change in the organization. For instance, using business process re-engineering to align business need with customer expectation.

3-Different Skills

Moreover, the skills needed by the project manager are different to those needed by operational managers.

Project Manager has the following skills:

-Role ends with project

- Temporary team

-Many different skills

-Work not done before

-Time, cost and scope constraints

-Difficult to estimate time and budget

Operational Manager has the following skills:

1- Routine

2-Stable organization

3-Specialist skills

4-Work repeatable

5-Annual planning cycle

6- Budgets set and fixed events

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Before we get to differences between project management and operations management, it is pertinent to brush up on our knowledge of projects and operations. It is a fact that all activities of an organization can be divided into projects and operations. Operations are ongoing, continuous and repetitive activities in any organization such as accounting, finance, or production. On the other hand, projects are specific tasks that have a beginning and an end such as working on developing a new product. All efforts and energies of an organization are distributed between these two categories of work. Let us see how project management differs from operation management.

One thing that becomes clear with the definition of project and operations is that unlike projects, in operations one has to stick with his decisions for a very long time. In project management, decisions take shape according to the size and nature of the project and can be changed in between also. This is because project managers start afresh as an when they complete a project. However, this differentiation is only a matter of perspective and in reality, the styles of both project management as well as operations management can be combined to be more efficient and productive.

One more difference that is self evident between project management and operation management is that operations have permanence while projects are rather temporary in nature. While you are running maintenance of your shop, you have undertaken a project that has a specific beginning and a specific end, but when you are back to normal, you run continuous operations of purchasing and selling goods in the shop. Again, while as a store owner, the process of renovation may be a project for you but from the perspective of the contractor who has an occupation performing such renovations, it is a continuous operation, only the site has changed.

A project manager is given a budget within which he has to carry out the task whereas in the case of operations, it is the duty of the operations manager to perform operations in a manner so as to generate maximum profits.

A project manager needs to be skillful in handling the workers as he has to finish the task with the given team in a given timeframe within a budget that he has to maintain and not overrun. In operations management, a thorough knowledge of the work process is crucial to have better productivity and efficiency.

New product development is seen as a project management and should be entrusted to a man other than operations manager. If management persists with the operations manager and his team, innovations and successful completion of the task is less likely than if the job is given to a project manager.

In brief:

Project Management vs Operation Management

• Just as all activities in an organization can be divided into projects and operations, so are managers associated with such tasks.

• Project management is temporary where as there is permanence in operation management

• There is a budget constraint in case of project management whereas there is the constraint of making maximum benefits for the organization.

• Good features from project management can be combined with operation management to have a better and more efficient style of management.

Project management is the management of a single project which has a set beginning, a number of tasks and a set end point.

Program Management is the management of a series of projects which may or may not run concurrently.

Operations Managament is the ongoing management of daily works such a technical support, network management etc and has no set end point.

For example, an interne tcompany may have many projects running to deliver new products to market and once a product is implemented then the project is finished whereas their operations management teams are occupied with the day to day support and management of the network, keeping it running, fixing problems etc etc.