2.3: Making operational decisions Flashcards
What are operations
The business function that organises, produces and delivers the products produced/provided by the business
What are the 6 stages of the production process
- Design
- Manufacture
- Assembly
- Test
- Control
- Deliver
What is job production
Producing one-off/bespoke products specific to the customer
What is batch production
Production in sets where each employee makes the same product for that set
What is flow production
Production in stages where each employee/set of employees works on a stage, making same product repeatedly
Pros and cons of job production
+ Satisfied workers & customers
+ Bespoke is a USP
+ Varied and customer specific
+ Can charge higher prices
- Slow
- Variable quality
- Labour intensive
- Can struggle with more orders
Pros and cons of batch production
+ Standardised quality
+ Quicker and more made
+ Variety can still happen
- Lower sales price
- Not as personalised
- Risk of overproduction
Pros and cons of flow production
+ Fast and can keep up with orders
+ Easily automated
+ Standardised quality
+ Easy to train workers
- Repetitive for employees
- No variety
- High inital investment for machinery
What are the pros and cons of having buffer stock
+ Can keep up with spikes in demand
+ Can replace damaged goods
+ Bulk buying discounts
- High storage costs
- Increased waste
- Uses up space
What is just-in-time stock control
The business doesn’t store raw materials and instead gets only necessary raw materials when they are running out
What are the pros and cons of JIT
+ Less production and storage costs
+ Fresher and less damaged products
+ Capital and employees for stock can focus elsewhere
- Hard to meet spikes in demand
- No bulk-buy discounts
- Careful planning and a reliable supplier necessary
What makes a good supplier
- Price
- Flexibility
- Reliability
- Bulk-buy discounts
- Quality
- Availability
- Trust
What is procurement
Getting the right supplies from the right supplier
What technology can be used for business operations
- computer-aided design (CAD)
- Supply chain management
- GPS
- electronic point of sale
- 3D printing
- e-commerce
What are the pros and cons of technology in operations
+ Speeds up production process
+ Business in touch with customers
+ Lowers production costs
+ Fewer mistakes and defects
+ Costly initial investment
+ Can quickly become obsolete
+ Employees need training for it
