What Is an Operations Department?

An operations department typically attends to those administrative, logistical, and other duties necessary for an organization's day-to-day functioning. Depending on the nature of the organization, an operations department, sometimes called a back office, may be responsible for a diverse range of responsibilities. Operations departments exist in businesses and other organizations in every segment of the economy, including but not limited to such diverse segments as the financial services industry, including banks and brokerages, as well as academia, manufacturing, non-profit organizations, and the military. An operations department in a financial services company will be responsible for such jobs as internal accounting, compliance with government regulations, clearing services and legal matters, as well as the maintenance of clients' records. In a brokerage, operations departments will also be responsible for monitoring clients' margin accounts, alerting them to margin calls when appropriate. The operations department in a financial services firm may also be responsible for human resources management. Note, however, that the operations department has little client contact, if any; its job is to give effect to the client's wishes. In a military organization, usually of battalion size or better, a staff officer will be designated as the operations officer and, depending on the size of the unit, may have additional support staff assigned. The operations function in a military unit will primarily be concerned with training and planning, and will generally be the largest and most important of the staff functions. Other staff functions such as logistics, personnel, and administration will coordinate their activities with the operations officer. In a manufacturing company, an operations department may take overall responsibility for the functioning of all support elements in a factory except the actual manufacturing process, which will fall under the jurisdiction of a plant or manufacturing director. The operations department in a factory setting is commonly responsible for such responsibilities as personnel administration, purchasing, housekeeping, and other facility issues, and transportation. In many organizations, as the information technology function has grown, it's been recognized as a critical component of the organization's ability to fulfill its mission, and in most cases has been absorbed by the operations department. This is especially true in the financial services sector, where having the most sophisticated information technology with the best staff is absolutely critical to serving the clients' needs. Operations departments, then, usually operate behind the scenes, living up to their common designation as "back office" functionaries. While they'll generally have little contact with the organization's clients or customers, they are a crucial element in the organization's success.