Flashcards in Unit 3 AOS 3 Deck (149)
Operations management is coordinating and organizing the activities involved in producing the goods or services that a business sells to customers.
Describe ways of effective operations management
Reducing time taken to produce goods or services, using the least amount of resources, and have the responsibility of implementing strategies that will contribute to the achievement of various business objectives.
Efficiency is how productively a business uses its resources when producing a good or service.
How can operations of management maximize efficiency?
An operations manager will constantly aim to maximize productivity within a business. Operations of management can implement strategies such as technological developments, materials strategies, quality strategies, and waste minimization strategies. Through this operations can improve levels of efficiency optimizing a business’s use of resources, production costs can be minimized, levels of waste may decline and the time taken to produce goods or services can be reduced.
Why may a business want to maximize efficiency?
Maximizing efficiency within a business’s includes the use of resources, production costs can be minimized, levels of waste may decrease and the time taken to produce goods or services can be reduced. Ultimately, improving the level of efficiency in operations can have positive implications on a business’s performance and the achievement of objectives.
Effectiveness is the extent to which a business achieves its stated objectives.
How can operations management maximize effectiveness?
Operations management can maximize effectiveness by using the most suitable strategies to lower production costs, improve quality, and reduce wastage.
Why may operations management want to maximize effectiveness?
If the management of operations ensures that the highest quality products are produced and the best price, then customers can be satisfied with the product or service and more likely to be regular customers in the future. This directly correlates towards achieving business performance and achieve objectives.
The relationship between operations management and business objectives: Make a profit
Possible operations strategies include implementing technology into production processes which can reduce the number of employees needed to complete business objectives which in turn reduces expenses and increases to make a profit.
The relationship between operations management and business objectives: Meet shareholder expectations
Possible operations strategies include checking products for being faulty which can improve the quality of a business’s product, increasing customer satisfaction and the business’s proportion of
sales within its industry.
The relationship between operations management and business objectives: Increase market share
Possible operations strategies include creating websites, maximizing effectiveness in business operations which can lead to increased sales which in turn can increase dividends and share price.
The relationship between operations management and business objectives: Fulfill a market need
Possible operations strategies include using new technology to design and increase quality of products. This can lead to new products being produced that is needed to meet customers' needs.
The relationship between operations management and business objectives: Fulfill a social need
Possible operations strategies include using reduced waste, recycling, and fundraisers. Doing so minimising waste can improve the environment and support communities can benefit individuals.
State the relationship between operations management and business objectives
Operations managers can contribute to the achievement of business objectives by improving levels of efficiency and effectiveness in a business’s production process. Additionally, operations managers are in charge of implementing strategies that optimise
operations, improve business performance and achieve business objectives.
Inputs are the resources used by a business to produce goods and services.
Processes are the actions performed by a business to transform inputs into outputs
Outputs are the final goods or services produced as a result of a business’s operations system which are delivered or provided to customers.
A manufacturing business is a business type that produces goods to sell to customers. A manufacturing business is typically capital and machine intensive during the processing from inputs to outputs and has minimal interaction with customers.
Service businesses provide intangible products, usually with the use of specialized expertise.
Similarities between manufacturing and service businesses
• Both service and manufacturing businesses aim to optimize their operations to produce high-quality outputs at a low cost of production.
• Both service and manufacturing businesses have to deal with suppliers during the process of managing operations.
• Both service and manufacturing businesses can utilize forms of technology in their operations systems.
• Both service and manufacturing businesses aim to optimize efficiency and effectiveness in their operations.
Differences between manufacturing and service businesses
Capital intensive, Occurs separately, Low degree of customer contact during production, Tangible output. storability of output, standardized production.
Labour intensive, Occurs simultaneously, High degree of customer contact during production, Intangible output, does not have storability of output, Tailored production
computer-aided design (CAD)
Computer-aided design (CAD) is a digital design tool that enables businesses to generate and modify technical illustrations of a product.
How can Computer-aided design increase efficiency?
It can reduce the time and labour resources used to design a product which improves productivity
How can Computer-aided design increase effectiveness?
A business can use CAD to develop the best designs to produce which can enable the business to manufacturer the highest quality design possible. This can, therefore, meet business objectives such as customer needs and make a profit.
Advantages and disadvantages of computer-aided design: Business
• Greater accuracy in the design process
results in a consistent level of quality which
can improve the business’s reputation.
• Customers have the flexibility to
modify a design to suit their needs. This
customization can attract more customers
for the business.
Disadvantages: If Computer-based designs replace employees it can cause a negative reputation to the company due to redundancies.
Advantages and disadvantages of computer-aided design: Employee
• Removes tedious processes involved in the
the design process which could be boring for
employees and mind straining.
• Allows employees to be more creative in the workplace.
• Employees may be made redundant due to replacement by CADs.
Advantages and disadvantages of computer-aided design: Time
Decreases design process times
Advantages and disadvantages of computer-aided design: Money
• Improved accuracy results in a consistently high-quality product which can increase customer satisfaction and may increase the number of sales.
• Expensive in the short term due to
purchasing and installing this technology.
• Updating software for technology can be expensive
• There can be expenses associated with
technical employee training on how to use
Computer-aided manufacturing (CAM)
Computer-aided manufacturing (CAM) is a software used to control and direct the production process by controlling machinery and equipment through a computer.