2.4 Resource Management Flashcards
What is job production??
One-off items produced by skilled workers
What is 1 positive and 2 negatives of job production??
Positive = customers willing to pay higher prices
Negative = lower productivity, increased costs (paying skilled workers)
What is batch production??
Small batches of identical products made
What are 2 positives and 2 negatives of batch production??
Positives = allows flexibility of output, benefits from economies of scale
Negatives = charge lower prices, cost & inconvenience of storing lots of raw materials
What is flow production??
Uses assembly line to produce lots of idneitcal products
What are 2 positives and 1 negative of flow production??
Positives = economies of scale, charge lower (competitive) prices
Negatives = if machines break down, it delays every product
What is cell production??
Flow divided into tasks for groups of workers to do
What are 3 positives and 1 negative of cell production??
Positives = increased worker motivation (not alone), higher quality, easier to alter product for customer needs (alter between stages)
Negative = lower productivity than flow
What is productivity measured as??
Output per unit of input, per unit of time
What are the benefits and drawbacks of using machines for productivity??
+ faster and operate for longer hours
- older ones need more maintenance
- need reprogramming is changes are made
How is a human workforce beneficial for productivity??
- Training ensures they know best and quickest methods
- Targets can motivate (and demotivated if too ambitious)
- Piece work & supervisors can motivate
What is efficiency??
When production happens at an overall minimum average cost
What are the 4 ways of increasing efficiency??
- Increase productivity
- Cut costs
- Reconsider design mix (to make product easier & cheaper)
- Minimise waste
What are labour-intensive firms??
People-heavy (use more workers and less machinery)
What are 2 benefits & 2 drawbacks of labour-intensive firms??
Benefits = Lower costs of not buying machines, humans can be retrained for new task
Drawbacks = Harder to manage people, costs of production increase with wages
What are capital-intensive firms??
More machinery & relatively few workers
What are 2 benefits & 2 drawbacks of capital-intensive firms??
Benefits = Machines often cheaper after initial investment, consistently quality, works 24/7
Drawbacks = inflexible (only suited to 1 task), delays if it breaks (less sales & reputation)
What’s capacity??
Maximum output a business can produce in given period without buying more fixed assets
What is capacity utilisation??
How much capacity a business is using
What’s the equation for capacity utilisation??
Current output/ max possible output x 100
What are the 4 drawbacks of over-utilisation??
- Turn away potential customers (can’t increase output more)
- If machine breaks down, work piles are delayed
- No time for equipment maintenance
- No margin of error
How can firms increase their capacity if they’re approaching 100% utilisation??
- Use facilities more during working week
- Buy more machines
- Recruit new staff
- Increase productivity
- Outsource during busy periods
What are the 3 drawbacks of under-utilisation??
- FC have to be spread over fewer units of output, so unit costs increase (firm may need to increase prices)
- Negative brand image
- Reduce employee motivation (less work to do)
