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What Are Business Operations?

By Page Coleman
Updated May 16, 2024
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Business operations are those tasks and activities that an organization undertakes to produce the services or goods that it provides to its customers. Efficient operations help companies reduce costs, and they might improve customer satisfaction. Technology can be used to automate many operations and improve efficiency.

Specific business tasks can vary depending on the type of organization. For example, business operations for an insurance company might include receipt of an insurance application, underwriting, accepting or rejecting the application and claims processing. In the case of a technical support organization, they might include things such as entering a service request, resolving it, escalating it to a higher level of support or putting it on hold.

Efficiency is important for large or small business operations, because efficient operations keep expenses down. Although operations don’t directly affect revenue, they do directly affect the company’s cost of doing business, so operations strongly influence its ability to be profitable. Indirectly, efficient operations might enhance revenue if they increase customer satisfaction, which can help increase sales.

Companies frequently initiate business operations analysis projects to evaluate and improve their processes. A business operations analyst might create business models as a part of this activity. The models make it easier to see all of the operations tasks and the interactions between departments. It becomes easier to locate duplicate or unneeded steps and to reorganize steps to improve efficiency. Frequently, companies will benchmark their processes against industry standards or best practices to help them discover which parts of their processes most likely need improvement.

After it has been determined that a business process can be improved, the analysis project might implement technology to improve operational efficiently. Many routine operations that had been handled manually can be completely or partially automated by software systems. As an example, a company that handled order acceptance manually through telephone calls from customers to inside sales representatives might build a website where its customers can place orders. The web ordering system can directly enter the orders into the company’s order entry system and bypass the need for the inside sales reps to enter them.

Some organizations establish ongoing programs to encourage employees to evaluate the business operations with which they are involved. The employees might be given opportunities to suggest improvements to these processes and to be recognized for their efforts. These programs usually are most successful when the organization acts upon suggestions that are feasible.

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Discussion Comments

By MrMoody — On Jul 22, 2011

@everetra - I think you’ve nailed it. Unfortunately, to manage business operations during those lull periods frequently means layoffs as the company shores up its processes, eliminates waste, and brings in automation to do jobs once performed by people.

That’s an unfortunate reality, but it’s true, and something that businesses simply must do to survive. I survived a layoff myself, and in one sense, it turned into a promotion for me so I’m certainly not complaining.

But I could see the writing on the wall. I had less and less work to do, and I was in a “back office” position rather than being on the front lines.

I knew that my days were numbered, but as I said, I survived, got a better job, and in hindsight I could see objectively how my position had to be eliminated in order to streamline the business. You learn not to take these things personally.

By everetra — On Jul 21, 2011

All businesses know what their primary goal is, but I think that one of the challenges in day to day business operations is a lull period.

That’s a time when the business is just kind of cruising along, sales are not as heavy as they once were, and the company is more or less in maintenance mode.

Of course, you can’t stay in that mode forever. When we get into lull periods, the boss has to do a combination of meeting with us on a more frequent basis to remind us what our goals are, and help us to rearrange our priorities if necessary. In other words, there’s never an excuse for slacking around at our company.

Our boss uses these lull periods to regroup, get input from employees on their ideas for new products and services and better position the business to move forward in a difficult climate.

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