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Unit 4 Flashcards

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1
Q

Operations management

A

Process that uses the resources or an organisation to provide rje right goods or services

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2
Q

Quality objectives including

A

Customer satisfaction rating
Customer complaints
Level of product returns
Scrap rate
Punctuality

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3
Q

Internal influences onnoperation objectives and decisions

A

Corporate objectives
Finance
Hr
Resources available

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4
Q

External influences on operational objectives and decisions

A

Market factors
Competitors actions and performance
Technological change

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5
Q

Capacity

A

Maximum level of output or production thag a business case produce in a given time period

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6
Q

Factors that capacity depends on

A

Level of demand for a product
Flexibility of production lines
Seasonality of output and demand

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7
Q

Benefits of high labour productivity and effeciency

A

Efficient use of input allows businesses to maximise production and therefore satisfy the needs of more consumers
Efficient use of input means fewer inputs are needed to produce a given level of output

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8
Q

How to increase efficiency and labour productivity

A

Improving the fertility of land
Using renewable or recyable resources greater education and training od the workforce

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9
Q

Difficulties increasing labour productivity and efficiency

A

Unlikely that land fertility can be increased
Many resources are not renewable
Education and training can improve productivity

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10
Q

Diseconomies of scale

A

As organisations grow they may suffer disadvantages thag lead to lower efficiency and higher unit costs

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11
Q

Co ordination diseconomies

A

Loss of control by management
Individuals less likely to follow policies
Large firms often have more rigid and inflexible policies

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12
Q

Communication diseconomies

A

Too many levels of hierarchy in a business
Difficulties also occur as span of controls widen
Large firms tend to use standardised communications

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13
Q

Motivation diseconomies

A

More difficult to assess the needs of mamy individuals
Large firms there may be less time for recognition and reward
Large hierarchies create distance between decision makers and staff

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14
Q

Capital intensive production

A

Method of production thay use a high level of capital equipment in comparison to other inputs such as labour

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15
Q

Labour intensive production

A

Methods of production thag use high levels od labour in comparison to capital equipment

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16
Q

Factors including choice between capital or labour intensive production

A

Method of production
Size and financial position of a business
Customers
Relative costs of labour and capital

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17
Q

Importance of capacity

A

Enable it to meet the level of demand for a product
Efficiency capacity management can ensure that a form is not spending excessive amounts on equipment and is able to reduce its unit costs

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18
Q

Under utilisation of capacity

A

When a firms output is below the maximum possible

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19
Q

Capacity shortage

A

Whena. Firms capacity is not large enough to deal with thr level of demand for its products
This means that some customers will eb disappointed

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20
Q

Reasons why a firm may be operating below irs maximum output-spare capacity

A

New competitors enter the market
Fall in demand of the product
Unsuccessful marketing
Seasonal demand

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21
Q

Disadvantages of spare capacity

A

Leads to a higher fixed cost per unit
These higher units lead to low profit of unit
Spare capacity can portray a negative image of a firm

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22
Q

Advantages of spare capacity

A

More time for maintenance and repair, training and improving systems during a period of space capacity
There may be less pressure and stress for employees

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23
Q

Ways of reducing capacity

A

Selling ot all or part of its production area
Changing to a shorter working wrrek
Laying off workers

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24
Q

Ways of increasing capacity

A

Building or extending factories
Asking staff to work overtime or long hours
Hiring new staff
A flexible workforce

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25
Lean production
Production based on the range of time saving and waste saving measures
26
Examples of techniques for lean production
Just in time management Quality circles Total quality management Cell production
27
The main aim of just in time
Reduce waste by eliminating the need for high levels of inventory This reduces costs by cutting warehouse space and staffing costs linked to the warehouse
28
Features of just in time productions
Links closely to people's management's Individuals are given more responsibili6y Also flexibility and multi skilling are also key feature of just in time
29
Benefits of just in time lean production
Increased productivity More motivated workforce as a result of greater skills and more interesting jobs Increased worker participation Reduced wast end inventory
30
Difficulties ot just in time as a method of lean production
Fewer opportunities for bulk buying Halting of production Undetected product faults
31
Features of lean peoduction
Short lead times Minimal stock levels Right first time quality Elimination of unnecessary processes
32
Features of mass production
Longer lead times High stock levels Quality inspection of finished product No close scrutiny of unnecessary processes
33
Main applications of robots
Handling operations Welding Other production applications Assembling
34
How does it assist communication
Allows a business to improve external and internal communications Internal information can be processed and amended more quickly
35
Benefits of technology
Reducing costs Improving quality Reducing waste I creasing productivity Flexibility
36
Issues in introducing and updating technology
Resistance to change Lower morale Cost Keeping up with change
37
Measures of quality
Appearance Reliability Durability Functions
38
Importance of quality
Gaining a competitive advantage Impact on sales volume Creating a unique selling point Impact on selling price Pricing flexibility
39
Benefits of insepction
Prevent a defective product It is a more secure system than an individual to itself May detect common problems
40
Drawbacks of inspection
Expense that can be viewed as unnecessary Does little to encourage individuals to improve quality as there is an inspector
41
Benefits of quality assurance
A sense of ownership of product rests with workers rather than inspector Costs are reduces as there is less waste and less need for reworking of faulty products
42
Benefits of improving quality
Gaining a competitive advantage Increasing sales volume Creating a unique selling point More scope to increase selling price
43
Difficulties of improving quality
May be difficult to convince people there is a problem May be difficulties in agreeing best solution to a problem
44
Consequences of poor quality
Reputation Lower sales volume Lower price Lower profits
45
Mass customisation
Offering individually tailored goods or service to customers on a large scale
46
Collaborative customisation
Where businesses work closely with individual customers to develop a product that suits the customers precise needs
47
Adaptive customisation
Business produces a product which can then be customised or a suited bu the consumer
48
Transparent customisation
Type of customisation that occurs when unique products are pro ided to each customer but are not identified as customised products
49
Cosmetic customisation
When standardised products are produced but marketed to different customers in different ways
50
Factors required for mass customisation
A Market in which customers value variety and individuality Quick responsiveness to market changes Ability to provide customisation Scope for mass effeciency
51
Benefits of mass customisation
Cost reductions Higher revenue Greater customer loyalty Improved understanding of customers wants Greater protection from market changes
52
Difficulties of mass customisation
Problems with rejected products Unsuitable supply chains Requirement for sophisticated info systems
53
Producing to order
A strategy in which a business only manufacturers a product once an order for that product has been received from a customer
54
Advantages of producing to order
Reduces cost of holding inventory Production planning is easier Ability to supply a product that meets customers exact specification
55
Disadvantages of producing to otder
Considerable fluctuations of production levels over time Higher costs Can be difficult to plan
56
Factors to consider when deciding produce to order
Value to customer of customised product Willingness of customers to wait for product Nature of product Cost of holding inventory
57
Advantages of employing temporary and part time workers in order to meet changes in demand
Efficient way to lower costs when full time cover is not necessary Availability of apartments time work may create a wider pool of candidates
58
Outsourcing
Transfer of activities which were previously conducted in house to a third party outside of the business
59
Advantages of oursourcing
Business able to reach to changes in demand more quickly if they have access to a number of other firms Let's a firm focus on its core business and help avoid becoming involved with activities
60
Disadvantages of outsourcing
Quality of the product is no longer directed under the firms own control Excessive outsourcing erodes a company's operation Cost of outsourcing should be evaluated
61
Factors influencing decisions to outsource
Available capacity Expertise Quality considerations Nature of demand
62
Inventories
Items that firms need to produce for or supply to customers Examples are raw materials. Work in progress which is part finished products and finished products
63
Inventory control
Is method to ensure that production matches demand Management of inventory
64
Advantages of hugg inventory levels
Customers demands are met promptly There is no loss of goodwill caused by running out of inventory Sudden increases in demand can be delt with effeciently
65
Advantages of low inventory levels
Reduced warehousing costs are possible Opportunity cost is low Perishable products are less likely to deteriate
66
Buffer inventory levels
The minimum level if inventory targeted by a business
67
Re order level
The inventory level which an order is placed for new inventory
68
Re order quantity
The actual number of products purchased from the supplier in a particular order
69
What three factors do re order level and quantity depend on
Suppliers lead time Demand for the product Consequences of running out of inventory
70
Causes of inventory wastage
Defects in production Theft Raw materials being wasted Damage to inventories during storage and production
71
Choosing effective suppliers
Price Payment terms Quality Capacity Reliability Flexability
72
Non current assets
Long term investments that the business has for a long time
73
Current assets
Assets that are likely to be sold this year
74
Current liabilities
Companies short term financial commitments that must be paid within a year
75
Non current liabilities
Debts a business owes but isn't due to pay for at least 3 months
76
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Business (8 decks)

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