5 - operations management Flashcards
Human resources aim
Aim- To ensure that the firm has the right quality and quantity of labor to meet its overall cooperate objective.
Includes: ⎫ Recruitment ⎫ Training ⎫ Motivation of employees ⎫ Ending the employment of staff
Finance and accounts aim
Role- Ensues that finds are available for a smooth and continuous flow of work.
Marketing aim
Role- Marketing department needs to understand and anticipate the needs and wants of its customers. Leads to the design of correct marketing strategies.
Operations management
Aim - The operations management function is responsible for the production of a firms good and services.
No matter what area the business is in, the objective of the operations function remains the same – to provide the things customers require so that they enjoy their purchases and become loyal customers.
Mass production
Manufacture of large quantities of a standardized good.
⎫ Involves large amounts of unskilled labor
⎫ Wide research and development
⎫ Selection initiatives to ensure there’s enough staff
Niche production
small-scale manufacture of a product that is then sold to a specific
section of the market.
- Small number of highly skilled staff.
- HR focuses on motivating and retaining current experienced employees.
Factors of production:
• Land– the actual piece of land or forest, or even the sea, together with all natural resources found on or in it, such as minerals, oil, trees and fish.
• Labour– human effort. The people who produce the product or provide the service: workers, employees, management.
- Capital– can be discussed in two ways: the money needed to open a business; or the tools, machinery and equipment used by a business.
- Entrepreneurship– an entrepreneur is the person who organizes the factors of production to create goods and services. This risk-taking activity creates the enterprise or business.
The role of the operations department
Turn the factors of production into goods and services that customers want to buy.
Products
the output of the operations management department. This could be anything from ahaircut (a service)to a lump of coal (a good).
Goods
these are products that are largely tangible (you can touch them). Cars, computers and chocolate bars are examples of goods.
Services
these are products that are largely intangible (you can’t touch them). Examples include watching a movie or renting a car. Once the service is finished, there is little physical evidence of what you consumed.
A pure service
Business is one in which theserviceis the primary entity that is sold.
Examples:
- airlines
- banks
- computerservice
A pure good
Products that do not include any service element.
Examples:
-Food from a grocery store with self-checkout.
Sustainability
A business organizes its operations in a way that ensures that actions today do not have a negative impact on the future generations.
Three areas of sustainability that should be taken into account:
1) Ecological sustainability
2) Social sustainability
3) Economic sustainability
Three p’s of sustainability:
1) People
2) Profit
3) Planet
Ecological sustainability
Refers to the use of the natural resources and the effect their current consumption will have on future generations. Larger population = Larger consumption of resources.
Economic sustainability –
Focuses on a business making the most efficient use of their resources. Encourages business objectives to focus on long term growth rather than short term.
Social sustainability-
Ability of a business not only to meet the needs of its current stakeholders, but also to support future needs of future generation of stakeholders. Current stakeholders can be divided into external and internal.
A business can meet the needs of its internal stakeholders, such as workers, employees and managers by adopting Maslow’s pyramid of needs.
Maslow’s pyramid of needs.
- Basic needs– provide a ‘living wage’ so that full-time employees can earn sufficientincome to support their families.
- Security needs– provide contracts to secure the job. Ensure work places and products are safe. Provide insurance for employees.
- Social needs– redesign jobs so that teamwork is possible. Provide facilities and opportunities for employees tosocialise (e.g. a cafeteria).
- Self-esteem needs– have a reward system in place to recognise and reward high-performing employees with promotions, bonuses and fringe benefits. Continually update all employees’ skills with ongoing trainingprogrammes. Offer apprenticeships to young unskilled workers.
- Self-actualisation needs– offeremployees time and resources to meet their personal goals.
Businesses can also affect the social sustainability of external stakeholders, for example:
- Suppliers– offer fair,long-term contracts tosuppliers, aiming to develop mutually beneficial partnerships.
- Local community– attempt to minimize redundancies. Provide sponsorshipfor local community events and charities.
Job production –
Producing unique items that are tailor-made to meet the needs of individual customers
Batch production -
Involvesproducing items in identical groups. Small changes are made in each batch so that a range of customers’ needs can be fulfilled.
Mass production-
A highly automated assembly process of a product.