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business studies > 2.4 - resource management > Flashcards

2.4 - resource management Flashcards

1
Q

capacity utilisation

A
  • a measure of the extent to which the productive capacity of a business is being used (%)
  • formula = current output/maximum possible output x 100
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2
Q

why do businesses want to perform at full capacity?

A

efficiency would be maximised means decreased costs and increased revenue

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3
Q

benefits of under-utilisation

A
  • sufficient space for factory to meet new orders
  • able to cope more easily with sudden increases in demand
  • workers will be more relaxed
  • less work-related stress
  • machinery repairs can be scheduled more easily
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4
Q

disadvantages of under-utilisation

A
  • higher fixed costs per unit
  • undermotivated staff
  • not making the most of resources
  • affects the morale of workers
  • can resent to working harder as they are not working at full capacity
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5
Q

benefits of over-utilisation

A
  • lower average costs
  • improve competitiveness
  • raise profits
  • better staff motivation
  • happier staff
  • improved company image = customers become more confident making orders
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6
Q

drawbacks of over-utilisation

A
  • can put a strain on resources
  • causes stressed staff
  • machines can be overworked
  • may not be able to respond to an increase in demand
  • insufficient time for staff training = saves money but staff can lack vital skills in the long term
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7
Q

ways of improving capacity utilisation

A
  • increase sales
  • increase usage
  • outsourcing
  • redeployment
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8
Q

rationalisation

A

reducing the number of resources, particularly labour, and capital, put into the production process, usually undertaken because a business has excess capacity

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9
Q

stock (inventory)

A

items used to make a product which is then sold to a customer
examples = raw materials, work-in-progress, finished goods

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10
Q

types of stock

A
  • raw materials = purchased from suppliers, used in the production process
  • work-in-progress = partly finished goods, not yet fully complete
  • finished goods = completed goods ready for sale, kept in to cope with changes in demand
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11
Q

influences of stock control

A
  • demand
  • stockpile goods
  • costs of stock holding
  • amount of working capital available
  • type of stock
  • lead time
  • external factors
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12
Q

buffer stock diagram

A

stock focuses on the re-order quantity (amount of stock ordered when a new order is placed) and the re-order level (level of stock currently held when an order is in place)

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13
Q

buffer stock

A

emergency stock held in case there is a stock shortage

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14
Q

advantages of buffer stock

A
  • easily respond to changes in consumer demand
  • if suppliers can’t deliver on time production won’t be affected
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15
Q

disadvantages of buffer stock

A
  • cost of storage is high
  • tied up working capital
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16
Q

implications of stock control

A
  • storage
  • opportunity cost
  • spoilage costs
  • administrative and financial costs
  • unsold stock
  • shrinkage
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17
Q

just-in-time management of stock

A

bringing in stock only when it is needed

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18
Q

advantages of just-in-time

A
  • cashflow improves
  • reduces wastage
  • more factory space
  • costs of stock holding reduced
  • links with suppliers improved
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19
Q

disadvantages of just-in-time

A
  • a lot of faith placed in the reliability and flexibility of suppliers
  • increased ordering and admin costs
  • advantages of bulk buying may be lost
  • difficult to cope with a large increase in demand
  • possible loss of reputation
20
Q

waste minimisation methods

A
  • more accurate sales forecasting to meet demand
  • suitable stock rotation
  • used computerised stock management system
  • adjust pricing strategy to minimise wastage
  • transport perishable goods rapidly
  • creative uses of wastage (too good to go)
  • use refrigeration for perishable goods
21
Q

what do consumers take into consideration when they think about the quality of a product/service?

A
  • physical appearance
  • reliability/durability
  • special features
  • suitability
  • availability of parts
  • after-sales service
  • repairs & maintenance in the future
  • image
  • reputation
22
Q

why are businesses concerned about the quality of the product design?

A
  • poor design can cause problems
  • costs time and money to redesign
  • clients can be lost
23
Q

why are businesses concerned about the quality of the production process?

A
  • faults can cause faulty products
  • machinery can break down
  • repairs can be expensive
  • late deliveries can harm reputation
24
Q

total quality management (TQM)

A
  • at all stages, there is quality assurance
  • preventive approach by the japanese
25
Q

quality assurance

A

at each stage, someone is making sure quality is high

26
Q

quality circles

A

small groups of workers in the same areas of production who meet regularly to solve production problems

27
Q

kaizen

A

japanese concept where improvements are always being made with everyone being involved

28
Q

productivity

A

output per input per hour

29
Q

production

A

total amount of output that is produced in a time period

30
Q

methods of production

A
  • job
  • batch
  • flow
  • cell
31
Q

job production

A

production of one single product at a time
- can be used for small one off’s or a large-scale project
- production process is labour-intensive
- found in manufacturing and service industry
- workforce made up of skilled and specialised workers

32
Q

advantages of job production

A
  • quality is high because workers are skilled
  • workers are well motivated because work is varied
  • products can be custom-made
  • production is easy to organise
33
Q

disadvantages of job production

A
  • high labour costs due to skilled workers
  • production may be slow
  • wide range of specialist tools needed
  • expensive method
34
Q

batch production

A

production of a product with similar characteristics which passes through different production operations
- more standardisation due to product made in batches
- products can be made in large or small batches

35
Q

advantages of batch production

A
  • workers specialise in one process
  • unit costs are lower because output is higher
  • production is more flexible
  • more use of machinery
36
Q

disadvantages of batch production

A
  • more complex machinery may be needed
  • careful planning and co-ordination needed
  • less motivation because workers specialise
  • small batches = high costs
  • money may be tied up
37
Q

flow production

A

production is organised so that different operations can be carried out, one after the other in a continuous sequence (mass production)
- large quantities of simplified and standardised product
- semi-skilled workforce
- large amount of machinery and equipment
- large stocks of raw materials needed

38
Q

advantages of flow production

A
  • very low unit costs due to economies of scale
  • output produced quickly
  • modern machines can allow some flexibility
  • production speed can vary according to demand
39
Q

disadvantages of flow production

A
  • products may be too standardised
  • huge set-up costs before production can begin
  • worker motivation can be low
  • breaks in production can be expensive
40
Q

cell production

A

involves producing a family of products in a small self-contained unit within a factory
- each cell occupies an area of the factory floor
- product family = a group of products that requires a sequence of similar products

41
Q

advantages of cell production

A
  • floor space is released, cells use less space
  • product flexibility is improved
  • movement of resources and handling time is reduced
  • less work-in-progress
  • team work is encouraged
  • safer working environment
42
Q

disadvantages of cell production

A
  • may have to invest in new materials handling and ordering systems
  • may not allow a firm to use its machinery as intensively as it wants
  • allocation of work to cells has to be efficient so they have enough work
43
Q

ways to improve productivity

A
  • productivity bonus
  • productivity deal
  • staff training
  • investment in new machinery and equipment
44
Q

factors influencing productivity

A
  • quality of inputs in the production process
  • labour shift organisation of workers
  • investment of new technology
45
Q

labour productivity

A
  • output per worker over a given period of time
  • formula = output per period/number of employees at work

business studies (16 decks)

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