operations Flashcards
(20 cards)
what is the equation for added value?
selling price-cost of raw materials
how might added value be increased?
cheaper raw materials
increase selling price
achieving brand status
offering additional services such as customer service
what is job production?
when the business makes one specific item often made by someone who is highly skilled and product is tailored to the customers needs
what are the advantages of job production
1- unique product
2-business can charge higher prices
3-unique product-differentiation
what are the disadvantages of job production
1- can be expensive ]
2- time consuming
3- staff need to be highly skilled so may be expensive to employ
what is batch production
when businesses make a certain number of the same product, the product be still unique
advantages of batch production
reduction in unit costs
allows variation
products can be produced in small or large quantities
disadvantages of batch production
initial costs of machinery
what is flow production
operations can be carried out one after the other, in a continuous sequence as production moves continuously from one stage of the process to the next.
advantages of flow production
less labour required
benefit from economic of scale
faster production method
disadvantages of flow production
high inital costs of machinery
what does the term productivity mean
the measurement of the efficiency which a business turns production INPUTS into OUTPUTS
what are the two types of productivity
labour
capital
what is the labour productivity equation
output (per period)
no of employees (per period)
what is the capital productivity equation
output
capital employed
what’s an advantage of high productivity
how can a business improve its productivity
what is the term ‘capital utilisation’
what is the equation for capital utilisation
acc level output
x100
max level output
what are the advantages of operating at full capacity
staff can feel more secure in their jobs- increased motivation
