2.2 Resource management Flashcards
What are the three types of production?
Job production
Batch Production
Flow production
Give an example of all three types of production.
Job production - Guitars
Batch production - Cupcakes
Flow production - Sausages
Give some pros of job production.
Pros
-Very organised workers
-Bespoke unique products
Give some cons of job production.
Cons
-Workers are expensive
-Wide range of tools needed
-Long lead team between start and finish.
Give some pros of batch production.
Pros
-Production can be changed to meet customer demands
-Lower wages as workers have lower skills
-Can be mechanised so no need for too many staff
Give some cons of batch production.
Cons
-Small batches can carry higher unit cost
-Workers are less motivated due to repetitive tasks
Give some pros of flow production.
Pros
-Average costs are much lower
-Mainly automated and computerised
Give some cons of flow production.
Cons
-High set up costs
-Low motivation for workers
-Break downs are very costly
What is cell production?
The production of items is organised into groups and then teams are set at workstations and see a product through to completion.
Give some pros of cell production.
Pros
-Minimal handling of the product cost
-Motivating for workers to see product completed
-Lead times are reduced
Give some cons of cell production.
Cons
-May cause Tension in the cell if it gets competitive
-Huge investment into each cell for machinery
What is labour productivity?
Labour productivity is the amount of volume of output that is obtained from each employee
What is capital productivity?
Products are produced by machines/robots, meaning the initial outlay & maintenance, will be very high.
Gives examples of labour intensive.
-Food processing
-Hotels & restaurants
-Fruit farming
-Coal mining
Give examples of capital intensive.
-Oil extraction
-Car manufacturing
-Web hosting
-Intensive arable farming
-Transport
What is capacity utilisation?
Capacity utilisation is the proportion of maximum possible output that is currently being used.
Give the equation for capacity utilisation.
Actual Output
————————————- X 100
Maximum Possible Output
Why do business not work at 100%?
-Lower demand
-Increase in capacity not yet matched by increased demand
-Inefficiency (poor maintenance)
How do you work above 100%?
-Increase workforce staff
-Sub-contract some production activities
-Reduce time spent maintaining production equipment
What is stock control?
Stock control is the control of the flow of stock in a business, it concerns the ordering and management of:
-Raw materials
-Work-in-progress
-Finished goods
What are the consequences for holding stock?
It costs money for:
-Storage area
-Computer records
-Staff to manage stock
-Cash tied up in stock
What is buffer stock?
This is stock a business holds onto in case of an increase in demand or the suppliers aren’t there in time.
What is the re-order level?
This is when the business decides to re-order more stock.
What is Just-In-Time (JIT)
When a business orders stock just in time for when it is needed.
What are the advantages of JIT?
-As parts are needed they are ordered which creates little wastage
-Parts are not needing to be stored in warehouses
-Less capital tied in stock
What are the disadvantages of JIT?
-Can’t cope with unexpected increases in demand
-If deliveries are late they will need to halt production
-Will not gain discount from bulk production
-Higher admin costs due to more order being placed
What is lean production?
This is an apporach to management that focuses on cutting waste, whist ensuring quality.
What is the aim of lean production?
To use less of everything;
-Time
-Labour
-Capital
-Space
-Raw materials
What is the definition of quality?
Quality is defined by the customers.
What are benefits of good quality?
-Generate positive brand image
-Retailors are more likely to stock a product with a good reputation
-Allows for a premium price
What are the drawbacks of poor quality?
-Loss of sales
-Loss of reputation
-May need to discount price
-May impact other product the business sells
-Retaoilors unwilling to stock
What are the different approaches to quality in business?
-Quality control
-Quality assurance
-Quality circles
-Total quality management (TQM)
What is quality control?
Quality control is concerened with checking and reviewing work that has already been done
What is quality assurance?
Ensures quality after every stage of production.
What are quality circles?
A gtoup of employees meet on a regular basis to solve production problems.
What is total quality management?
It is a management approach to building a business culture that puts quality at the heart of everything in the business.
What is kaizen?
Is a policy that constantly introduces small changes in a business in order to improve quality.
