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Operations Strategies Flashcards

1
Q

What are the operations strategies

A
  • new product or service design and development
  • performance objectives
  • outsourcing
  • supply chain management
  • technology
  • quality management
  • inventory management
  • global factors
  • overcoming resistance to change
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2
Q

What 6 come under performance objectives

A

quality
speed
dependability
flexibility
cost
customisation

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3
Q

what is quality

A

quality is the consistency and dependability of output. in ensuring quality, wastage and remedial costs can be reduced.

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4
Q

Quality’s role in evaluating operations

A

shows the effectiveness of the production process- whether each product meets the required demands

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5
Q

what is speed

A

speed is the turnaround time between customers ordering a product or service and the point at which they receive it

  • when an organisation delievers the goods or services on time, the more likely a customer is to be satisfied with their experience
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6
Q

speed’s role in evaluating operations

A
  • determines the efficiency of operations
  • can allow managers to identify areas of improvement
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7
Q

what is dependability

A

Dependability is being on time ( consistency ), determines repeat business

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8
Q

what is dependability’s role in operations

A

consistency shows effectiveness of current processes - whether they work or not

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9
Q

what is flexibility

A

adapting to changing circumstances
- external ( focus on customer satisfaction )
- internal ( focus on production speed )

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10
Q

what is flexibilitys role in operations

A
  • shows the fiverse skills throughout the operations process - ability of employees to adapt to change
  • the more flexible - the shorter lead time
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11
Q

what is customisation

A

creating individualised products to meet customer needs
- ability of a business to cater for diverse tastes and preferences

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12
Q

what is customisations role in operations

A

shows the flexibility of processes and their ability to change to meet demand

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13
Q

what is cost

A

reducing expenses to create a bigger profit

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14
Q

how does cost link to operations

A

initatives to minimise costs are central to strategic role of operations management
- efficiency of processes = profitability

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14
Q

What 6 come under performance objectives

A

quality
speed
dependability
flexibility
cost
customisation

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15
Q

Strategy 2.
What is new product or service design and development

A

The design, development, launch and sale of new products enables a business to grow and attain a competitive advantage

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16
Q

What are the two approaches

A
  1. consumer approach ( preferences are identified trough market research and determines which products are designed and developed )
  2. changes and innovations in technology that enable new, appealing products to be made
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17
Q

What 6 come under performance objectives

A

quality
speed
dependability
flexibility
cost
customisation

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18
Q

what does explicit mean in terms of a service

A

the tangible aspect of the service being provided, such as the application of time, expertise, skill and effort

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19
Q

what does implicit mean in terms of a service

A

based on a feeling and is therefore intangible.

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20
Q

Strategy 3.
What is SUPPLY CHAIN MANAGEMENT

A

Supply chain management involves integrating and managing the flow of supplies throughout the inputs, transformation process and outputs in order to best meet the needs of customers

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21
Q

what 3 aspects are included in supply chain management

A
  • logistics
  • e-commerce
  • global sourcing
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22
Q

what is logistics

A

a term referring to distribution but includes transportation, the use of storage, warehousing and distribution centres, materials handling and packaging

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23
Q

characteristics of logistics

A
  • movement of goods and information through the supply chain
  • distribution / transportation
  • storage - finding a secure place to hold stock
  • warehousing
  • handling and packaging
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24
define storage
involves finding a secure place to hold stock until it is required - can be long term or short term
25
define warehousing
involves the use of facility for the storage, protection and distribution of stock - hold inventories ( cost )
26
define e-commerce
buying and selling of goods and services via the internet
27
3 types of e-commerce
E-procurement - online systems to manage supply, allows suppliers direct access to the business B2B - direct access from one business ( supplier ) to another ( buyer ) B2C - transaction with customers
28
ADVANTAGES of e-commerce
- allows businesses to manage supply - B2B - direct access from one business to another - purchase items at a lower cost from other nations - target a wider audience
29
define global sourcing
obtaining inputs from around the world
30
ADVANTAGES of global sourcing
- cost and expertise advantages, access to new technoligies and resources - cheaper ( higher quality inputs ) - differentiated products
31
Strategy 4 Define Outsourcing
Outsourcing is the use of external providers to perform certain business activities
32
ADVANTAGES of outsourcing
- cost saving and efficient - specialised and expert staff - productivity increased - time and money is not wasted on training / development - improve quality of product
33
DISADVANTAGES of outsourcing
- lack of loyaty to the business - potential lower quality - employee dissatisfaction - lack of control over quality - communication and language barriers
34
strategy 5 Technology
1. leading edge technology 2. established technology
35
what is leading edge technology
Helps businesses create products quicker and achieve higher standards, with less waste and may also help them operate more effectively - most advanced or innovative at any point in time
36
ADVANTAGES of leading edge technology
- provides a competitive advantage - point of difference
37
DISADVNTAGES of leading edge technology
- is unreliable - more expensive - requires retraining for efficient use
38
what is established technology
It has already been developed, widely used and widely accepted. - eg. computers and software that manage the operations process - establish basic standards for productivity
39
ADVANTAGES of established technology
- cheaper - reliable / proven
40
DISADVANTAGE of established technology
- lacks a competitive advantage
41
Strategy 6 Inventory Management
It is the amount of raw materials, work-in progress and finished goods that a business has on hand at any particular point in time
42
ADVANTAGES of inventory management
- consumer demand can be met straight away - reduced lead times between order and delivery - make immediate revenue
43
DISADVANTAGES of inventory management
- costs, storage charges, spoilage, insurance, theft, handling expenses - invested capital, labour + energy cannot be used elsewhere as it has to be used to create stock
44
In terms of inventory management what are the 3 types of pricing
LIFO FIFO JIT
45
what is LIFO
last in - fist out Stock purchased most recently is sold first eg. used for goods with no use-by-dates eg. canned goods
46
what is FIFO
first in - first out oldest stock sold first eg. ideal for perishables
47
what is JIT
just in time Holding as minimal stock as possible and only bring in stock from suppliers as required - increases liquidity of working capital - reduced costs of storing + securing stock
48
Strategy 7 Quality Management
- control - assurance - improvement
49
what is quality control
reduces problems and defects through inspection at various points during production - pre-determined quality targets are set for all products to meet
50
What is inspection and quality control
It ensures all outputs meet required standards, many businesses carry out inspections for all or parts of the total volume of production
51
what is quality assurance
involves use of a system to ensure set standards are achieved in production
52
what does quality insurance involve
- use of a system to ensure all set standards are achieved - proactive application - takes a series of measurements and assesses them against predetermined quality standards - FIT FOR PURPOSE - 'how well a product does what it is designed to do'
53
what is within improvement
total quality improvement and continuous improvement
54
what is continuous improvement
ongoing commitment to improve business over time - process more efficient and effective - inclusion of staff into improvement process
55
what is total quality management
'holistic' approach where the quality becomes both a commitment and the responsibility of every employee of the business
56
Strategy 8 Overcoming resistance to change
FINANCIAL COSTS - purchasing new equipment - redundancy payments - retraining - reorganising plan layout - inertia
57
Financial Costs
Main financial costs associated with change include - purchasing new equipment - reduancy payments - retraining - reorganising plant layout
58
1. purchasing new equipment
Can be expensive however cost can be recovered through use and depreciation ACHIEVE: - improved processing speed - shorter lead times - more consistency in production - higher quality - reduced waste
59
2. Redundancy payments
Money given to employees when they are forced out of work due to their job skills no longer being relevant PAYMENT DEPENDS ON: - duration working - level of pay - amount of unused leave
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3. Retraining
May occur when job roles change requiring employees to acquire different work skills - purchase of new technology may involve new training
61
4. reorganising plant layout
requires extensive reorganisation of the layout within the facility - high costs can occur
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5. Inertia
Internal stakeholders such as owners, managers and employees become too comfortable in a stable environment, and therefore are resistant to change STRATEGIES: - retraining programs - work teams - flatter management structure
63
6. Global factors
1. global sourcing 2. economies of scale 3. scanning and learning 4. research and development
64
what is global sourcing
Sourcing goods and services from across national boundries
65
benefits of global sourcing
- cheap skilled labour - cheap materials - tax breaks - cost advantages - access to technologies
66
complexities of global sourcing
financial - risk associated with fluctuations of exchange rates contractual - language + cultural barriers, regulations + law differences
67
economies of scale
refers to cost advantages that can gained by producing on a larger scale - cost leadership is achieved
68
benefits of economies of scale
- scale of production increases -- unit per cost falls ( proftability rises ) - product life cycles are extended - greater value on production
69
scanning and learning
A business benefits from scanning the global environment and learning from the best practises around the world eg. can learn from - management journels - industry and business conferences - forums
70
research and development
helps a business create leading edge technologies, and to create innovative products and solutions - finding out what consumers want and assisting to create products that meet their needs

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