2.4 Resource Management Flashcards
What is job production?
One-off or small number of items produced, meets the specific requirement’s of the consumers
* Examples: - Plumbers
Advantages of job production
- Customer requirements and changes can be handled
- Associated with higher quality
- Employees can be better motivated - more job satisfaction
- A flexible production method
Disadvantages of job production?
- high Individual cost of one unit
- Often labour-intensive = high labour costs
- Requires close consultation with the client
- Usually reliant on high skills
What is batch production?
Similar items are produced together. Each batch goes through one stage of production process before moving onto next stage
Aims of batch production
Achieve better use of equipment and so produce good quality products more economically than manufacturing them individually
Advantages of batch production
- batch reduce unit costs
- customers have some choice
- Allows a firm to handle unexpected orders
- greater quality control
Disadvantages of batch production
- timely to switch production of one batch to another
- high inventory costs
- Tasks are repetitive - reducing motivation & efficiency
what is flow production
product moves continuous through the production process. high volumes are produced of the same product
advantages of flow production
- lower unit costs
- manufacture large identical quantities
- capital intensive - so it works constantly
- less need for training and skills
Disadvantages of flow production
- reliant on high quality machinery
- High inventory costs
- Goods are mass produced - less differentiation
- Production is shut down if flow is stopped
what is cell production?
has the flow production line split into a number of units. each “cell” is responsible for part of the product
advantages of cell production
- closeness of cell members, improve communication avoiding confusion
- greater work motivation
- workers become skilled & adaptable for future needs
- quality improves as each cell has ownership for quality in their area
disadvantages of cell production
- company culture has to encourage trust & participation
- may not allow a firm to use machinery
definition of capacity
maximum output that a business can produce in a given period with the available resources
why is capacity important?
it allows the company to match the demands of the customers
definition of spare capacity?
when a business is not making full use of its available capacity, there are spare factors of production including land, labour and capital
capital utilization formula
current output/ maximum possible output x 100
drawbacks of underutilization of capacity
- inefficiency - not producing maximum capacity, firms cant exploit economies of scale. may lead to an increase in average costs
- loss of market share - operating less than full capacity, result in reduction of sales in a business
benefit of underutilization of capacity
more flexibility - its level of output can change when needed, and firm has time to fix machines without stopping production
drawbacks of overutilization of capacity
- maintenance - not enough time fro machines to be maintained. machine may break down, can ruin reputation
- inflexible - unable to increase further output, cant provide for any unexpected orders
- staff- under excessive pressure, make more mistakes & unhappy
benefit of overutilization
- average costs of production fall and this would result in the firm becoming more competitive
what factors can improve capacity utilization
- reduce capacity
- increase sales
- outsourcing
as it allows the business to increase its output
JIT - just in time
- holds little stock
- reduces waste of materials
- cheaper costs of storage, so can charge a lower price on goods
- need frequent deliveries and if the supplier is unreliable the firm may run out of stock
what is quality control
checks goods after they’ve been made.
- quality control inspectors check others work
- eliminates faulty goods
what is quality assurance
introduce checks throughout the production process to prevent errors from the beginning. each product is tested at each stage of the production process
- aims to get it right first time
- employees check their own work
what is total quality management
quality is the centre of everything a business does. every employee focuses on quality to improve overall quality of the products
advantages and disadvantages of TQM
- boots a firms reputation
- leads to less faulty products
- takes a long time to instil
- demotivate staff- s they have to put a lot of effort in
- expensive
what is a quality circle
they aim to identify and solve quality problems by meeting at regular intervals. it increases motivation as all staff are involved
what is kaizen (continuous improvement)
lean production where employees improve their work all the time, this reduces waste
