topic 4 (operations)

Question 1

Operations management

Answer 1

the activities, decisions and responsibilities of managing production and delivery of products and services

Question 2

Labour intensive

Answer 2

a relatively high proportion of labour in the production is used compared to equipment

Question 3

Capital intensive

Answer 3

uses a relatively high proportion of capital equipment relative to labour.

Question 4

operational objectives include:

Answer 4

• Costs
• Quality
• Speed of response and flexibility
• Dependability
• environmental objectives
• added value

Question 5

profit=

Answer 5

sales revenue – (variable costs + fixed costs)

Question 6

reducing cost per unit enables what

Answer 6

a low unit cost enables a business either to keep prices low for customers or to enjoy a higher profit margin

Question 7

U can reducing variable costs per unit by

Answer 7

finding cheaper supplies

Question 8

reducing fixed cost can occur when

Answer 8

when businesses have merged because they may have duplication of fixed costs

Question 9

quality

Answer 9

those features of a product or service that allow it to satisfy customers

Question 10

quality cab be measured by

Answer 10

Customer satisfaction ratings
Customer complaints

Question 11

Dependability

Answer 11

businesses do not want to let customers down and so focus on ensuring that they meet promises- or are dependable

Question 12

environmental object may include

Answer 12

• reducing waste
• reducing carbon footprint
• minimising waste products or materials
• increasing recycling
• achieving self-sufficiency in energy use.

Question 13

added value

Answer 13

the difference between what a business spends to produce its goods or services, and the price that customers are prepared to pay.

Question 14

external factors

Answer 14

CCPESTEL
consumer,competitor,political,environmental,social,
technological,economic,legislation

Question 15

Internal influences on operational objectives

Answer 15

cooperate objectives
finance
human resources
the nature of product/service

Question 16

labour productivity is

Answer 16

The amount (volume) of output that is obtained from each employee

Question 17

labour productivity formula

Answer 17

output per period/ number of employees in that period

Question 18

increasing labour productivity can be achieved by

Answer 18

• recruiting suitably skilled and trained employees
• training to improve skills and attitudes of existing
  employees
• using appropriate remuneration and non-financial
  benefits to improve
• improving working practiced
• improved technology and capital equipment

Question 19

difficulties of improving labour productivity

Answer 19

training of existing staff may take longer
Employing new people with the appropriate skills can be costly and may also take time

Question 20

unit costs =

Answer 20

total cost/ units of output

Question 21

capacity is

Answer 21

The maximum total level of output or production that a business can produce in a given time period.

Question 22

capacity utilisation is

Answer 22

The % of a firms total possible production level that’s being reached

Question 23

capacity utilisation =

Answer 23

capacity output per annum(year)/ maximum posssible output per annum(year)

Question 24

how to increase capacity

Answer 24

• invest in capital machinery
• invest in employees through training
• hire more employees
• Change production practices to be more efficient.

Question 25

lean production

Answer 25

Aims to reduce all forms of waste in the production process

Question 26

just in time production(JIT)

Answer 26

This involves reducing the stock holding of a business to make it more efficient.

Question 27

benifts of JIT

Answer 27

- Reduced stock holding - Smaller warehouses - Less staff needed to manage and control stock - Improved relationship with suppliers - Less risk as stock will not perish or go out of date

Question 28

drawbacks of JIT

Answer 28

- Production line could stop completely leaving staff and machinery idle - Reliability of suppliers - Reliability of raw materials - Reduced options for responding to customer demands

Question 29

benifits of quailty

Answer 29

creates usp impacts sales impacts sellling price pricing felixbility frim reputation

Question 30

quality controll

Answer 30

a system that uses inspections to check the quality of work at stages of the manufacturing process.

Question 31

pros of quality control

Answer 31

Quality checks at the end can stop faulty goods reaching customers Inspectors can spot common problems and out them right

Question 32

cons of qaulity control

Answer 32

Does not encourage responsibility Expensive to operate Responsibility rests with inspectors, therefore staff take no responsibility, which could reduce motivation.

Question 33

quality assurance

Answer 33

A system that improves quality by arranging every process to get products right the first time

Question 34

pros of quality assurance

Answer 34

Workers take responsibility Motivates workforce Reduced costs because of less waste Greater consistency of quality products because responsibility is spread throughout workforce.

Question 35

cons

Answer 35

Needs a change in the culture of the organisation Can take time to embed the system because of cultural change Could increase costs in the short term

Question 36

kaizen

Answer 36

A policy of implementing small, incremental changes in order to achieve better quality and greater efficiency

Question 37

mass customisation

Answer 37

the personalisation or custom tailoring of goods or services to meet customer needs – but at near mass- production prices.

Question 38

methods of increasing capcity

Answer 38

- Extending factories - Overtime or longer hours - Hiring new staff - Flexible workforce - Sub-contracting

Question 39

methods of reducing capcity

Answer 39

- Sell of fixed assets - Changing to shorter working weeks or days - Laying of workers - Transferring resources to other areas/locations

Question 40

temporaty contract

Answer 40

A temporary contract is an employment contract that is for a fixed period or can be terminated easily by either party

Question 41

stock control charts show

Answer 41

lead times re-order levels buffer level of inventory re-order quanties

Question 42

measure of reliability

Answer 42

the percentage of deliveries on time how much the suppliers meet its terms of contract

Question 43

vertical intergration

Answer 43

this is a method where businesses can guarantee the reliability, quality and flexibility of their suppliers as they buy their suppliers