2.4 : Resource Management Flashcards
What is productivity ?
An important measure of productive efficiency - describes how much input can be turned into products
Productivity equation :
Total production costs in period / total output in a period
What are the ways of improving productivity ?
Training , more capital equipment , better capital equipment , improved motivation , better quality raw materials , improved organisation of production
What are the internal V external economies of scale ?
Internal - arise from the increased output of the business itself
External - occur within an industry
What are the internal economies of scale ?
Buying economies - buying in greater quantities usually results in a lower price
Technical - use of specialist equipment or processes to boost productivity
Marketing - spreading a fixed marketing spend over a larger range on products , markets + customers
Network - adding extra customers or users to a network that is already established
Financial - larger firms benefit from access to more + cheaper finance
Risk bearing
What is the method of production - JOB ?
The production of one off items to meet the needs of each individual customer
Cheap and easy to set up but more expensive to produce
Often a specialist service
Time-consuming to produce
Meet specific needs of customers
What are the method of production - BATCH ?
Similar items are produced together
Each batch goes through one stage of production process before moving onto next stage
Aims to concentrate skills
Achieve better use of equipment and so produce good quality products more economically than manufacturing individually
What are the advantages of BATCH ?
Costs savings can be achieved by buying in bulk
Still allows customers some choice
Products can be worked on by specialist staff or equipment at each stage
Allows firm to handle unexpected orders
What are the disadvantages of using BATCH ?
Takes time to switch production of one batch to another
Cause the business to hold high levels of stock of raw materials + work in progress
Tasks may become boring reducing motivation
Size of batch depends on capacity allocated
What is the method of production FLOW/MASS ?
Items flow along a line of production in a continuous process - when one task is finished the next is started immediately after - therefore time taken on each task must be the same - suitable for mass production - uses specialist machinery - workers are involved in each step of the process , this involves : specialisation + division of labour
What are the advantages of using FLOW/MASS as a means of production ?
Efficient process due to : specialisation of workers , division of labour + use of machinery
Cost per unit of production reduced through improved work and material flow
Suitable for manufacturer of large quantities
Capital intensive which means it can always work
Less need for training and skills in their workers
What are some disadvantages of using FLOW/MASS as a form on production ?
High initial costs
Very long set up time + finished stocks unless lean production
Goods are mass produced - less differentiation for the customer
Production is shut down if the flow is stopped
What is the method of production - CELL ?
A form of flow production whereby the production line is split into a series of self contained cells
Teams are given the responsibility of doing a part of production process as products moves through assembly line - the members of cell work as a team to achieve goals + ensure quality standards are met
Depends upon staff being well trained - cell production often leads to improved productivity
What does labour intensive mean ?
Production relies on using labour resources
What are the benefits of using labour intensity ?
More flexible than machines
Checks quality as they have better judgement unlike machines
