Unit 4 Flashcards
(35 cards)
What are operational objectives
Target set by a business to produce goods or services in the most efficient way
What are their operating objectives
Cost/Volume Quality Efficiency/flexibility Innovation Environmental targets
What are some internal inferences of operational objectives
-Staff training
– New payment systems
– investment in equipment
– New manager
What are some external inferences of operational objectives
-New technology
– rival/competition
– new law
– recession
What Are advantages of innovation
– Added value
– higher prices/probability
– opportunities to build any customer loyalty
– enhance reputation as innovative
What is purchasing economies of scale
When buying in bulk to reduce price
What is productivity
Measurement of efficiency relationship to in organisations input and outputs
How do we measure productivity
– Labour turnover
– labour productivity
– absenteeism rate
What is the equation for labour productivity per employee
Output per period/number of employees per period
How do we increase labour productivity
– Update equipment
– improve motivation
– training
What is the optimum re-sauce mix
Combination of capital/human resources for greatest efficiency
What Is labour-intensive and what is capital intensive
Labour Intensive
– firms using mostly workers/employees
capital intensive
– firms using mostly machinery
What are some advantages of labour-intensive and what are disadvantages
Advantages
– human initiative
– less investment – workforce can adapt easily
– continuous improvement
Disadvantages – less productivity – pay labour cost – less efficient – Unreliable – pay for advertisement -lack of skilled workers
What are the advantages and disadvantages of capital intensive
Advantages – more Efficient – saves money – less wages – Mostly human error – improve productivity – lower labour costs – greater opportunities for Economy of scale
Disadvantages – Expensive – could be faulty – takes up space – like human initiative – greater resistance To change –high investment outlay
Lean production
And approach to management that focuses on cutting out waste whilst insure the quality
Advantages and disadvantages of quality assurance
Adv
- puts customers at heart of production
- motivational since workers feel more invl and make decisions
- less wasteful than throwing out defective finishes products
- eliminates cost of inspection
Dis
- req strong leadership
- substantial invest in training and support
- disruption/cost may outweigh benefits
What is quality
A product/service is of good quality if it meets the needs and expectations of the customer
What are some features of quality products
- performance
- appearances
- availability
- reliability/durability
- price
Why is quality important
Competitiveness Customers -have knowledge and are more demanding -prepared to complain ab poor quality -share ab poor quality
Customer satisfaction = repeat purchase= customer recommendation = lower market
costs= higher customer loyalty
What’s the difference between fixed and variable costs
Variable varies with amount produced
Fixed remain same
Added value formular
Price of product-cost of production
What are the factors that influence choice of suppliers
Cost
Quality
Reliability
Adv and dis of having spare capacity
Dis -higher unit costs than competition(lack competitiveness) -less likely to reach breakeven output -capital tited up in under-utilised assets Ads -higher quality products -more motivated -able to respond better to problems
What is capacity utilisation
Percentage of total capacity that’s actually been achieved in a given period
