Operations Flashcards
Consequences of overstocking
Supplies could go out of date if they are stored for too long.
Supplies could go out of fashion before they are used.
Too many supplies leaves a risk of theft by staffs, customers or thieves.
Consequences of under stocking
Business may run out of stock and be unable to continue production or carry on selling.
May be no stock to sell, resulting in bad reputation and customer not returning.
Increase in delivery costs since many smaller deliveries will have to be made.
What is job production?
involves producing unique one-off products. Products are made to order, from start to finish one at a time. For example a tailor-made suit or dress.
Advantages of job production?
Higher prices can be charged as the product is unique and made to customers requirements.
Products can match exact requirements, which increase customer satisfaction.
Disadvantages of job production?
High wages need to be paid to the highly skilled staff that job production requires.
High costs can make the price too high, which can put many customers off.
What is batch production?
Involves making groups of identical products at a time. each batch is made exactly the same.
Advantages of batch production?
Batches can be adapted to meet customer requirements.
There is less need for highly skilled workers.
Materials can be bought in bulk, gaining discounts.
Disadvantage’s of batch production?
If a mistake is made it can ruin an entire batch.
Employees are likely to be demotivated as tasks are repetitive.
Small batches can raise the unit cost of each item in the batch.
What is flow production?
Involves identical products being made on an assembly line. Product is made in stages, with parts being added as it moves along the production like.
Advantages of flow production?
Huge amounts of products can be produced, which leads to high sales.
Workers specialise in the same routine task speeding up production and accuracy.
Disadvantages of flow production?
Products cannot be adapted to meet customer requirements.
Workers can be demotivated through the boredom of doing the same routine tasks.
What is capital- intensive production?
Involves producing products that primarily use machinery and equipment to produce products.
Advantages of capital-intensive production?
Robots can do jobs that are dangerous for humans to do.
Robots don’t take breaks, holiday’s or sick leave so they can work 24/7.
Disadvantages of capital- intensive production?
Huge investment is needed to automate a production line.
Breakdowns can lose hours of production time and wasting vast amount of materials.
What is labour- intensive production?
Involves humans doing most of the work.
