Section 4 Flashcards
Enterprise resource planning - ERP
Use of a single computer app to plan the purchase and use of resources in an organisation to improve efficiency of operations
~> allows for the coordination and linking of all systems
Supply chain
All of the stages in the production process from obtaining new material to selling the product to customer
~> Supply chain management
Significant application for ERP
Stages of SCM :
• plan - decide on resources needed
• suppliers - choose most effective suppliers and ordered JIT
• cost - record costs and calculate price
• manufacture - check quality and monitor progress
• deliver - choose transport system and deliver most effectively
Capacity utilisation
The proportion of maximum output capacity currently being achieved
Current output level x100
Maximum output level
~> Used to determine operational efficiency
Excess capacity
Exists when the current levels of demand are less than the full capacity output of a business - AKA spare capacity
Rationalisation
Reducing capacity by cutting overheads to increase efficiency of operations
Full capacity
When a business produces at maximum output
Capacity shortage
When the demand for a business’s products exceeds production capacity
Outsourcing
Using another business to undertake a part of the production process rather than doing it within the business using the firms own employees
Business- process outsourcing - BPO
A form of outsourcing that uses a third-party to take responsibility for certain business functions, eg. finance
Lean production
Producing goods and services with the minimum amount of waisted resources while maintaining high quality
Wastes of time: • Excessive transport • High worker movement • High inventory holding • Waiting time • Over production • Over processing • Defects
Consists out of:
• JIT
• Kaizen
• Flexible specialism
Simultaneous engineering
Product development is organised so that different stages are done at the same time instead of in sequence
Cell production
Splitting flow production into self-contained groups that are responsible for whole work units
Kaizen
Works on the process that workers have greater insight into productivity + requires constant small improvements not a once off massive improvement
Quality
Meets customer expectations and fits the purpose
Quality standards
Expectations of customers expressed in minimum acceptable production standards
Quality control
Based on inspection/sample of products
Quality assurance
A system of agreeing and meeting quality standards at each stage of production to ensure customer satisfaction
Stages: → product design → quality inputs → quality → delivery system → customer service/after sales
Quality control techniques
→ prevention
→ inspection
→ correction and improvement
ISO 9000
Internationally recognised certificate that acknowledges existence of a quality procedure that meets certain conditions
Total quality management - TQM
An approach to quality that aims to involve all employees in quality improvement
Benchmarking
Identifying best firm in the industry and comparing performance standards
Stages:
- identify aspects to be benchmarked
- measure the areas performance
- Identify best firm in industry
- compare data to establish weakness
- Set standards for improvements
- change process to achieve standards
- Re-measure
Project
Specific/temporary activity with a start, end date, clear goals, responsibilities and budget
Project management
Using modern management techniques to complete a project from start to finish to achieve objectives in time and cost
Elements: → resources : people/material → time → money → scope: size/scale of project
Management elements:
- Define project with objectives
- Divide into tasks/activities
- Control/check time limits
- Give clear roles
- Provide control of quality, issues and risks
Critical plan analysis/network analysis
Planning technique that identifies all tasks in a project, puts into correct sequence then allows for identification of critical path
