2.2 Flashcards
(35 cards)
define production
the action of making or manufacturing from components or raw materials or the process of being so manufactured
what is job production
making one unique product from start to finish
what is batch production
making batches of similar products
what is flow production
continuous production of identical items
what are the advantages and disadvantages of job production
+/ you can charge a premium price
high quality
motivated workers
-/ expensive to hire specialist staff
labor intensive
high selling costs
takes a long time
what are the advantages and disadvantages of batch production
+/ production can be varied to meet customer needs
less labor intensive
employees specialize so become better at their job
lower skilled workforce so lower costs
-/ small batched carry high average unit costs
repetitive work so less motivation
what are the advantages and disadvantages of flow production
+/ large quantities made
only a small number of unskilled workers are needed
economies of scale
lower production cost
computerized
-/ not flexible
cant charge a high price
demotivated staff
high start up costs
what is cell production
production of items is organized into groups and then teams are set at workstations and see a product through to completion
what are the advantages and disadvantages of cell production
+/ large range of products
gain skilled workers
-/ requires a lot of organization
high start up costs
what is lean production
an approach to management that focuses on cutting out waste and ensuring quality
define productivity
the measure of the efficiency of a person, machine, factory or production
how do you calculate labor productivity
output (per time period) / number of employees (per time period) X100
how do you calculate capital productivity
output/ capital X100
what are the problems with holding too much stock
waste of space
may be perishable
goes out of style
may have to be kept in certain conditions
money could be invested elsewhere
higher insurance costs
theft
may not sell all the stock
what is jit (just in time)
helps negate the issues associated with holding too much stock by introducing the required supplies at the moment they are needed
what are the advantages of jit
increased efficiency
reduces costs
no space wasted holding stock
less capital tied up in stock
what are the disadvantages of jit
can’t change stock levels to meet demand
no room for error
if deliveries are late production may have to be stopped
will not get economies of scale
complex to organize
how does jit impact staff
work is dependent on deliveries
production may be halted
lots of training required
better pay as more complex to carry out
how does jit impact suppliers
more stressful to organise
need a good relationship between business and supplier
increased profit
what are the aims of lean production
aims to reduce:
time
labor
capital
space
raw materials
define capacity utilization
the proportion of your maximum output that is currently being used
what is the equation for capacity utilization
actual output/
max output X100
what are the advantages and disadvantages of working at 100% capacity utilisation
+/ lower unit costs
more products produced in a shorter period of time
job security
-/ demotivated staff
needs demand otherwise there is waste
more frequent machine breakdown
not possible to benefit from an increase in demand
pressure causes mistakes
why may a business choose to work below 100% capacity utilisation
lower demand
capacity can reflect demand so less waste
loss of quality
