4.1 Setting operational objectives notes Flashcards
(20 cards)
What does operations management describe?
Describes the activities, decisions and responsibilities of managing production and delivery of products and services.
What does operations management involve?
- Involves managing the process of converting inputs into outputs.
- It transforms resources into goods and services.
Operations management.
The overall operations process is made up of what?
What does it involve?
- Overall operations process- made up of a series of smaller operation processes.
- Operations management- involves choices and decisions & it is at the very heart of the organisation- it is what it actually does.
Setting operational objectives
What decisions would need to be taken by operations manager?
- Level of output a business needs to produce.
- Range of products a business wants to offer, the level of customer service to provide & how flexible a business wants to be in relation to customer customer demands.
- How best to produce the good/ service: labour intensive & capital intensive.
- How best to provide the good or service to the customer.
- How much of the process managers want the business to provide themselves and how they want to use suppliers.
What does labour intensive mean?
Means that a higher proportion of labour is being used compared to capital equipment.
What does capital intensive mean?
Means that a higher proportion of capital equipment is being used compared to labour.
What is the supply chain?
The series of activities involved in taking the initial resources to providing the final product.
How can you categorise operations?
Volume
Variety
Variability
Visibility
What does visibility of production refer to?
Refers to how visible staff are in relation to the final customer. Some operations have little if any direct contact with the final customer.
What will happen if volume of output is low?
Likely to be high unit costs.
Employees likely to be multi-skilled.
Little repetition of tasks.
What is likely to happen if volume of output is high?
High repeatability.
Low unit costs.
Capital intensive.
What is likely to happen if variability of demand is low?
Stable
Routine
Predictable
High capacity utilisation.
What is likely to happen if variability of demand is high?
- Changing levels of capacity utilisation.
- Need to try and predict demand.
- Need flexibility.
What is likely to happen if visibility of production is low?
Limited customer service skills.
Time lag between production and consumption.
What is likely to happen if visibility of production is high?
- Good customer service skills needed.
- Flexible in terms of information and communications to customer.
What is likely to happen if variety of output is low?
Routine operations.
Standardised processes.
Low unit costs.
What is likely to happen if variety of output is high?
Flexible.
Quite complex operations to manage.
High unit cost.
Can meet customer needs precisely.
What does the operational decision making process include?
Setting operations objectives.
Analyse operations data.
Make operations decisions.
Implement decisions.
Review.
How can ethics and the environment affect operational decisions?
- Treatment of employees: Increased workload may improve amount produced but place high levels of stress on employees.
- Location factors: Locate in low-wage location- why may this be good?
- Safety: Does the business only implement safety features it is obliged by law to save costs?
- Environment: Noise, pollution and emissions. Does a business concern itself with its suppliers environmental costs?
What are examples of operational objectives businesses would want to achieve?
- Costs
- Quality
- Speed
- Flexibility
- Dependability
