Managment of Operations

Question 1

What four things influence the schedule for production

Answer 1

Demand from customers and which orders are most important Design of the product - some customers ask for a higher specification of product to be made especially for them Resources avaliable and if they are in stock or are to be ordered in time for production Production capacity - the level of production that can be provided with the resources avaliable

Question 2

What are the three catagories of stock

Answer 2

Raw materials Work-in-progress Finished goods

Question 3

What are four factors that must be considered in stock managment

Answer 3

The quantity of products that are required The volume than can be manufactured at one time The working practices The storage space avaliable

Question 4

What four features should effective stock managment have

Answer 4

A process for regular stock checks Some cost savings A security system in place to prevent theft A system for rotation of stock to prevent deterioration

Question 5

What are four advantages of centralised storage

Answer 5

Improved security of stock Can be supervised by specialist staff Can operate agreed procedures for issue and receipt Can use agreed procedures for ordering

Question 6

What are two disadvantages of centralised storage

Answer 6

Time is wasted going to and from stores The cost of specialist staff and a dedicated storage area will be high

Question 7

What are three advantages of decentralised storage

Answer 7

Stock is always on hand when required Orders of stock will reflect actual usage Faster turnover of smaller amounts of stock reduces likeliheed of deterioration

Question 8

What are two disadvantages of decentralised storage

Answer 8

Less rigid control of security - theft and loss are more likely Takes up space in production areas

Question 9

What are four problems with overstocking

Answer 9

High costs Lack of storage space High opportunity costs Unsold stock

Question 10

What are four problems with understocking

Answer 10

Loss of customers Production stoppages Higher admin costs Less discount avaliable

Question 11

What four things does succesfull JIT depend on

Answer 11

a highly skilled and flexible workforce that is able to respond to the challenges of JIT absolute certainty regarding delivery times, to ensure that production runs to schedule if suppliers provide sub-standard items the whole system fails as there isn’t an alternative resource waiting stock Good quality control procedures are essential to ensure quality is high

Question 12

What are four advantages of JIT

Answer 12

improved cash flow reduced stock holding costs Less stock wastage Higher profits due to lower costs

Question 13

What are four disavantages of JIT

Answer 13

More difficult to respond to changes in customer demand Higher administration/transport costs Lack of bulk buying discount Suppliers must be very reliable for system to work properly

Question 14

What is capital intensive production

Answer 14

Capital intensive refers to a productive process that requires a high percentage of investment in fixed assets (machines, capital, plant) to produce.

Question 15

What is labour intensive production

Answer 15

A production process that has a high reliance on the skills of human labour rather than machine automation.

Question 16

Four advantages of capital intensive production

Answer 16

Machinery can operate 24/7 Higher volume of goods can be produced quality of output is standardized and consistent Removes the chance of human error

Question 17

Four disadvantages of capital intensive production

Answer 17

Large initial financial outlay to purchase machines Cost of maintaining and repairing equiptment can be high Only suitable for standardised production process production time is lost if machines break down

Question 18

What are four advantages of labour intensive production

Answer 18

It its easier to organise this type of production Additional flexibility due to human skills More responsive to changes in the needs of customers Lower start-up costs than capital-intensive production as no intial outlay on machinery/equipment

Question 19

What are four disavantages of labour intensive production

Answer 19

A skilled workforce can be expensive to recruit, pay and train Business cannot take advantage of economies of scale Staff illness or absence can impact on the production process Additional quality control measures may be required due to human error

Question 20

What four factors must be considered when choosing a method of production

Answer 20

The nature of the product The quantity to be produced/market size The level of quality required The resources avaliable

Question 21

What four things does quality mean for consumers

Answer 21

Quantity provided for the price paid reliability and durability of the product The extent to which the product or service satisfies their requirments How environmentally friendly the product is

Question 22

What four things does quality mean to producers

Answer 22

Meeting exact specifications A highly skilled workforce No customer complaints Having a good design to work with

Question 23

What are four methods of ensuring quality

Answer 23

Using high quality resources quality control quality assurance quality standards and symbols

Question 24

What is quality control

Answer 24

A method in which quality inspectors coduct spot checks on the final products

Question 25

What is quality assurance

Answer 25

Quality assurance is when quality checks are conducted at each stage of production rather than simply at the end

Question 26

What are quality symbols

Answer 26

Symbols such as BSI kite mark and CE Mark are used to convey to customers that standards are being met

Question 27

What are four benefits of mystery shoppers

Answer 27

Feedback is recieved that can be used to improve processes Training needs can be identfied Improves customer retention Monitors quality of products and service

Question 28

What are four ways HR can contribute to maintaing quality

Answer 28

Recruiting only the best staff Implementing and maintaing a process of appraisal Staff training and development should be a continuous process A staff handbook should be issued to all staff

Question 29

Factors to consider before choosing a distribution method

Answer 29

Reliability of other organisations legal restrictions Avaliability of finance The product being distributed

Question 30

What are five transport methods

Answer 30

Road Rail Sea Air Pipeline

Question 31

What are four problems in logistics

Answer 31

Road works Transport accidents and diversions Bad weather such as high winds, heavy rain or snow and ice Industrial action at ferry points, air traffic control

Question 32

What are four benefits of adopting fairtrade

Answer 32

Customers are happy to buy fair trade products so there will be increased customer loyalty Most businesses who are licensed for fairtrade enjoy a good reputationand public image and then find it easier to attract new staff A survey by free poll found that 96 percent of consumers are prepared to spend extra on products if they perceive them to be more ethically produced The uk market for fairtrade goods is doubling in size approximatley every 2 years.

Question 33

What are three costs of adopting fairtrade

Answer 33

The price is higher for consumers compared to non-fairtrade products, which can be viewed unfavourably by some consumers Small scale production is promoted fairtrade, but econjomies of scale cannot be acheived and it is more difficult to control production methods and prices. Concern over climate change and food miles has resulted in some businesses and consumers weighing up the benefits of faitrade with the cost to the environment of transporting goods

Question 34

What three environmental issues should businesses avoid

Answer 34

Pollution Dumping of waste Using up scarce resources

Question 35

What three positive environmental action can businesses take

Answer 35

Recycle Reduce packaging Reduce energy use

Question 36

What are four benefits of complying with environmental controls

Answer 36

Reducing energy use can reduce running costs Reducing the amount of raw materials used can reduce production costs and minimise the cost of waste disposal Income may be generated from recycling equipment and materials, and savings can be made on the cost of disposing these items Taking preventative measures to maintain the enivornment can be more cost-effective than dealing with consequences of environmental damage after it has been done

Question 37

What are three costs of complying with environmental controls

Answer 37

extra financial costs, recycling of waste extra time required to train staff to raise awarness of ethical practices and environmental protection procedure Policies and procedures have to be written and kept up-to-date with new legislative requirements

Question 38

What are two benefits of ethical actions

Answer 38

The business will gain a good image and reputation making it easier to attract customers and to recruit staff Staff will be more satisfied and motivated if they believe the business is operating in the right way and treating everyone fairly

Question 39

What are two costs of ethical action

Answer 39

Same as environmental costs Extra time will be needed to check that suppliers are acting ethically and being environmentally friendly

Question 40

What are four benefits of epos

Answer 40

Valuable market research data can be collected about the type of products that are popular or unpopular which in turn can inform decisions about which products to stock more/less of Customers can use epos data to check the stock levels of products when buying on-line The business can track how sensitive customers are to changes in selling prices

Question 41

What are two ways technology can be used in operations

Answer 41

CAD and CAM

Question 42

What are two benefits of quality assurance

Answer 42

Costs are reduced because there is less wastage as mistakes are ratified early in the production process It improves worker motivation as workers have more ownership and recognition for their work

Question 43

Stock control Diagram

Answer 43