The nature of operations Flashcards
(20 cards)
what is ‘Operations’
the use of resources called inputs to provide outputs in the form of goods and services.
what must operations managers be concerned with?
1.eficiency of production − keeping costs as low as possible will help to give competitive advantage.
2. quality − the good or service must be suitable for the purpose intended.
3.flexibility and innovation − the need to develop and adapt to new processes and new products is increasingly important in today’s dynamic business environment.
what is the The production / transformation process?
‘Inputs’ are converted or transformed into ‘outputs’ and this is sometimes called the ‘transformation’ process.
what is ‘production’?
the making of tangible goods, such as computers, and the provision of
intangible services, such as banking.
what is Added value?
the difference between the cost of
purchasing raw materials and the price the finished goods are sold for.
what factors do the amount of added value depend on?
- Making sure the design of a product has quality features enables higher prices to be charged.
- The efficiency with which the input resources are combined and managed.(increased productivity = lower costs)
3.Being able to convince consumers to pay more for the product than the cost of the inputs.
what are the stages before u physical sell the good/service?
1.converting a consumer need into a product that can be produced efficiently.
2.organising operations so that production is carried out efficiently
3.deciding on suitable production methods. (Job production,batch production and flow production.
4.setting quality standards and maintaining them.
List of resources
- land (where the business is operating from)
2.labour-The effectiveness of labour can usually be improved by training in specific skills – but trained workers will become sought after by other businesses and may leave.
3.captial- what the business use to produce goods, the more productive and
advanced the capital, the greater the chance of business
success.
what is Intellectual capital?
intangible capital of a business that
includes:
1. human capital (well trained and knowledgeable employees)
2. structural capital (databases and information systems)
3. relational capital (good links with supplier and customers).
what is production?
converting inputs into outputs.
labour productivity (number of units per worker) =
total output in a given time period
total workers employed
what is Productivity?
the ratio of outputs to inputs during
production, e.g. output per worker per time period.
what is the definition of the Level of production?
the number of units produced
during a time period.
how can productivity be increased?
- Improve the training of staff to raise skill levels.
- Improve worker motivation.
- Purchase more technologically advanced equipment
- More efficient management.
Is raising productivity always the answer?
- could lead to workers wanting higher wage demands.
- fear of loss of jobs (improvements in labour productivity.)
- more significant if the culture of the management benefits workers.
- The difference in efficiency
why is labour productivity important?
- Higher labour productivity reduces unit costs
- Increased efficiency means faster production, allowing the business to meet customer demand more effectively.
3.A more productive workforce means fewer employees are needed, reducing overall labour costs.
What’s the definition of Production inputs?
the resources used in the production process to create goods and services. These inputs can be classified into four main categories
What is the definition of Efficiency?
producing output at the highest ratio of output to input.
What is the definition of Efectiveness?
meeting the objectives of the enterprise by
using inputs productively to meet customers’ needs.
