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Operations Flashcards

1
Q

Explain added value

A

The difference between what a business spends to produce its goods or service, and the price customers are willing to pay

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2
Q

How do you calculate added value

A

The selling price - the cost of bought in materials and components

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3
Q

Explain what’s meant by innovation

A

Altering an already existing product

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4
Q

Explain what’s meant by research

A

Work done to see how you could improve a product

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5
Q

Explain what’s meant by development

A

Physically improving the product from the research you have conducted

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6
Q

Explain the reasons for innovation, research and development within a business and industry

A

Improve productivity
Increase competitiveness
Improve brand recognition
Increase turnover
Improve profitability
Changing external factors

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7
Q

Explain product innovation

A

Developing existing products to differentiate it from their competitors

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8
Q

Explain process innovation

A

Finding a new or better method of production to increase: efficiency, productivity, reduce costs +waste and to improve quality

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9
Q

Evaluate the disadvantages of innovation

A

Time consuming
Initial costs
Staff motivation

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10
Q

Evaluate the advantages of innovation

A

Improved productivity
Reduced costs
Increased competitiveness
Improved brand recognition
Increased turnover and profitability

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11
Q

Explain job production

A

Production items that meet specific needs of customers

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12
Q

Explain batch production

A

May similar items are produced together

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13
Q

Explain flow production

A

Continuous movement of items through production processes (when one task finishes the next one starts immediately)

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14
Q

Explain cell production

A

Workers split into teams to work on a part of the production process

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15
Q

State advantages of job production

A

Meets customers needs
High quality
Higher job satisfaction
More flexibility

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16
Q

state disadvantages of job production

A

No economies of scale
Higher costs
Requires skilled labour
Difficult costing

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17
Q

State advantages of batch production

A

Reduces unit costs
Can still address customer needs
Faster than job production
Some economies of scale
Some flexibility

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18
Q

State disadvantages of batch production

A

Time can be lost switching batches
Need to keep stock of raw materials
Can be de-motivating
Money is tied up in storage

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19
Q

State advantages of flow production

A

Continuous
Economies of scale lowers the cost of production
Division of labour and specialisation

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20
Q

State disadvantages of flow production

A

Difficult to alter the production o=process
Employee boredom
High set up costs
Can’t address customer needs

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21
Q

State advantages of cell production

A

Workers become multi-skilled and adaptable
Greater workers motivation
Can lead to efficiency
Quality improvements

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22
Q

State disadvantages of cell production

A

May not allow firms to use their machinery as intensively, meaning output will be lower
Greater investments required in new management and control process
May be rivalry between different cells and conflict may arise

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23
Q

Explain specialisation

A

Where workers perform specific tasks

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24
Q

Explain division of labour

A

The allocation of workers into specific tasks, intended to increase productivity

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25
Explain the reasons for the introduction of specialisation and division of labour into a business
It’s introduced for the intention that worker productivity and efficiency will increase therefore lowering business costs. This creates a larger profit for them
26
Explain the advantages of division of labour
Workers become more efficient Output increases whilst lowering business costs Improves the profit margin
27
Explain the disadvantages of division of labour
Tasks may become repetitive so workers become de-motivated and less efficient If talks are small and repetitive, automation may take over resulting in redundancies
28
Explain project management
The act of planning, organising and managing a project in order to achieve a predefined outcome or goal
29
Explain why businesses use project management
It helps every part of the business run more efficiently and effectively
30
Explain what a Gantt chart is
Graphical representation of the order and duration of tasks within a project
31
Explain what CPA is
A project management technique which shows how to complete tasks in the shortest possible time
32
Explain what PERT analysis is
Used to calculate the amount of time it takes to realistically finish
33
Explain the advantages of PERT analysis
More realistic given pessimistic views A simple formula to apply A lot of data can be visually represented
34
Explain the disadvantage of PERT analysis
It can be difficult to judge
35
Explain the advantages of a Gantt chart
Allows a visual representation Easy to monitor Shows time and resource allocation
36
Explain the disadvantages of a Gantt chart
Doesn’t show the critical activities Can’t see EST and LFT Can’t calculate float times
37
Explain the advantages of CPA
Helps reduce the risk and cost of complex projects Encourages careful assessment Better allocation of resources Provides managers with a useful overview of the project Allows resources to be delivered just in time (JIT)
38
Explain the disadvantages of CPA
Reliability is largely based on accurate estimates Doesn’t guarantee success of the project Resources may not be as flexible as the management hope
39
Explain what’s meant by productivity
The volume of output by each employee
40
How to calculate measures of productivity
Output / number of machines Output / input
41
Explain the advantages of high productivity
Helps a business become more competitive Same output with less units of labour, reduces costs Encourages investment as productivity’s a measure of performance
42
Explain the disadvantage of productivity
If units of labour are reduced, it may lead to job insecurity and make management harder
43
State ways to improve productivity
Setting targets Motivation techniques Investing in technology Staff training Division of labour
44
Explain what is meant by economies of scale
Unit costs falls as output rises
45
Explain what’s meant by diseconomies of scale
Unit costs rise as output falls
46
Explain what’s meant by internal economies of scale
Achieved as a result of a firm growing internally
47
Explain what’s meant by external economies of scale
Benefits the whole industry not just one firm
48
Types of internal economies of scale
Technical - gain the benefit of buying more effective capital equipment Managerial - employ specialist managers Marketing - use most effective marketing methods Purchasing - buying raw materials in larger quantities Financial - negotiate cheaper loans Risk-bearing - spread risk by diversifying into different products
49
Explain capacity utilisation
The percentage of total capacity that’s actually being achieved in a given period
50
Explain capacity management
Managing the available capacity to ensure that resources are used optimally
51
Explain advantages of capacity utilisation
Average unit costs fall Less wastage of resources Employee motivation Stakeholders view businesses as favourable
52
Explain disadvantages of capacity utilisation
Competition Seasonality Alternative products Maintenance and breakdowns Additional orders can’t be done
53
How to reach full capacity
Reduce stock room size Increase demand for your products Differentiate the product
54
Explain stock control
Processes and controls used by a business to ensure that it has sufficient stock for its purpose
55
Explain just in time
Allows stock to fall to zero as no need of time to replenish stock
56
Explain advantages of just in time
Lower stock holding means less costs for storage Less likely of stock perishing Less time spent on checking and re-working the product
57
Explain disadvantages just in time
Little room for mistake as minimal stocks kept for re-working faulty products If not delivered on time, can cause the whole production to be delayed No spare finished products to meet unexpected orders
58
Explain lean production
Focuses on cutting waste whilst ensuring quality and improving efficiency
59
Explain why lean production is used
Doing the simple things better Doing things better Involves employees in the continuous improvement
60
Explain ergonomics
Looks at the relationship between the employee and the capital equipment being used
61
Explain kaizen
Improvement in quality as an ongoing phenomenon and not something that takes place occasionally
62
Explain total quality management
The efficient usage of all resources used within the production process, on finding ways to prevent mistakes rather than inspecting for mistakes
63
Explain time based management
Attempt to reduce the time taken between the generation of the idea for a product and it going into production
64
Explain Kanban
Helps to organise the flow of components onto the production line at the right place and at the right time
65
Explain jidoka
A process for building into the production an ability to detect and reject faulty goods and components at the earliest time
66
Explain how technology can be applied in the operations of a business
Technology could be used in the production of their products through buying machines which can replace workers and they do the same job
67
Explain advantages of technology ina business
Cuts employment costs More efficient than workers Can be the most up to date software so would be efficient
68
Explain disadvantages of technology in a business
May break which adds costs for replacing it May not be reliable High costs to begin with when buying the machinery
69
Distinguish quality control
The process of checking the quality of products for any faults
70
Distinguish quality assurance
Processes that ensure production quality meets the requirements of customers
71
Explain reasons for quality control and quality assurance in a business
Make sure theirs no faults in products which reduces the chance of customers wanting refunds, maintains a good reputation
72
Explain why total quality management is used in a business
Helps organisations identify skill deficiencies in employees along with necessary training that’s required
73
Explain reasons for training employees in a business
They will be more efficient Less likely to make mistakes, meaning that no resources are wasted
74
Explain BS 5750 kitemark
Rewarded to businesses that adopt certain quality procedures
75
Explain ISO9000 European standards
Member states are obliged to make them and remove ones that might conflict it
76
Explain quality benchmarking
The general approach to business improvement based on the the best practice in the industry and it allows them to see where they fall short against competitors
77
Explain the factors affecting the choice of location for a business
Labour costs - vary from location to location Land costs - location can affect the price of warehouses etc Proximity to raw materials - transport costs are reduced if you’re closer to them Labour skills - where specialist skills are required Site suitability - some may need particular characteristics to maximise customer satisfaction Potential expansion - future production capacity has to be taken into account
78
Evaluate the impact and importance of location to a business and stakeholders
If they are far from materials it could increase the costs for the business or if they dont have the correct warehouse they could have to spend more money on getting the correct facilities
79
Explain what’s meant by logistics
The movement of good from one pace to another, meaning two functions transportation and warehousing
80
Explain supply chain management
The handling of the entire production flow of a good or service to maximise quality,delivery, customer experience and profitability
81
Explain distribution management
The process used to oversee the movement of goods from supplier to manufacture to wholesaler or retailer and end up at the consumer
82
Explain the role of warehousing
The process of storing physical inventory for sale or distribution
83
Explain the role of distribution centres
The handle receiving from manufacturers or wholesalers and organising them o be shipped to the customer
84
Evaluate factors affecting logistical decisions
Demand characteristics (eg seasonal) Logistic costs (transport + warehousing) Product characteristics
85
Explain offshoring logistics
Moving manufacturing or other business processes overseas
86
Explain advantages of offshoring logistics
Lower labour costs Access skilled labour Access to global marketplace
87
Explain disadvantages of offshoring logistics
Time zone differences Quality control issues Cultural and language barriers
88
Explain restoring logistics
Bringing back outsourced personnel and services back to the home location from where they were from
89
Explain advantages of resourcing logistics
Better control over supply chain Improves product quality Enhances innovation
90
Explain disadvantages of resourcing logistics
Can’t use cheap about so higher costs Few skilled workers available Expensive process to bring the production back
91
Explain outsourcing logistics
When a company uses an external provider to handle various supply chain functions
92
Explain advantages of it sourcing logistics
Controlled costs Increased efficiency Share the freight costs
93
Explain disadvantages of outsourcing logistics
Loss of control Unavoidable costs Strategic misalignment
94
Explain subcontracting logistics
Hiring an outside firm or individual to complete specialised tasks that can’t be done internally
95
Explain advantages of subcontracting logistics
Helps with large projects Increased productivity They have specialised knowledge
96
Explain disadvantages of subcontracting logistics
Lack of control Increased costs Lowering of standards

Business studies (9 decks)

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