2.4 Resource Management

Question 1

Job production definition, pros cons 3,2

Answer 1

Producing a specific single good at a time

P-High quality products
-highly skilled and motivated workers
-flexibility of products

C-slow production
-labour costs are high

Question 2

Batch production definition, pros cons 2,2

Answer 2

Batches of the same products are produced at the same time

P-workers can specialise on a specific batch
-economies of scale

C- high set up costs of capital goods
-completed products need to be stored

Question 3

Flow production definition, pros cons 3,2

Answer 3

Continuous production of the same products on production line

P- economies of scale
-fast production
-highly automated so low labour costs

C-no customisation
- capital can be expensive

Question 4

Labour productivity equation

Answer 4

output/number of workers

Question 5

Factors influencing Productivity 4

Answer 5

Employee motivation
Skills/education/training
flexibility
investment in capital goods

Question 6

Capital intensive vs Labour intensive production

Answer 6

Capital intensive production mainly uses machines and technology to produce whereas labour intensive uses physical labour

Question 7

Pros cons of Labour intensive production 3,3

Answer 7

P- low production costs compared to capital
-flexibility
-can be creative

C-may be unreliable
-incentives needed to motivate staff->higher costs
-training costs

Question 8

Pros and cons of Capital intensive labour 3,3

Answer 8

P-low production costs if output is high
-machines are usually reliable
-no breaks needed-> high productivity

C- high start up and maintenance costs
-breakdowns -> decreased productivity
-no flexibility

Question 9

Capacity Utilisation equation

Answer 9

Current output/ maximum output x100

SHOWN AS A %

Question 10

Implications of under-utilisation 2

Answer 10

Fixed costs are spread over fewer units of output resulting in higher average total costs

Provide flexibility and firm can react to a sudden increase in demand

Question 11

Implications of over-utilisation 1

Answer 11

no flexibility to respond to an increase in demand
staff under pressure to produce such high output
high capacity utilisation->low unit costs->lower prices-> higher firm competitiveness

Question 12

Ways to improve capacity utilisation 2

Answer 12

outsourcing however profit margins may be produced

reduce capacity or staff however flexibility to respond to increased demand is reduced

Question 13

Pros and cons of holding buffer stock 2,2

Answer 13

P-supply stability, can react to an increase in demand
-price stability, to avoid a shortage of supply causing a large price increase

C-expensive to keep inventory space
-opportunity cost

Question 14

Just in Time (JIT) definition, pros and cons 2,1

Answer 14

When supplies are ordered just in time for production

P-inventory costs are limited
-unused storage can be used productively

C-inability to react to sudden increase in demand

Question 15

Quality control definition, pros and cons 2,2

Answer 15

Inspecting the quality of products at the end of the production process

P-quality specialists are employed to check standards->limited mistakes
-inexpensive and simple way to check output

C-rejection of products cause wastage
-little focus on cause of defects

Question 16

Quality assurance definition, pros and cons 2,1

Answer 16

inspecting the quality of products during the production process

P-issues can be identified early and fixed-> less wastage
-cause of defect is focuses so will reduce future mistakes

C-skilled training is required