2.4.1 production, productivity and efficency

Question 1

what are the 4 methods of production

Answer 1

1 job production
2 flow production
3 batch production
4 cell production

Question 2

what is 1 job production

Answer 2

• when he product is made to order
• one product at a time for a specific customer
• takes a long time to produce by skilled workers

Question 3

evaluate job production

Answer 3

+ can charge high prices if the product is unique or handmade
- can’t take advantage of economies of scales as they don’t produce in bulk
- costs will be higher to pay the skilled workers

Question 4

what is flow production

Answer 4

• when production of standardised products is continuous to produce large amounts
• often operates 24 hrs
• used in mass market

Question 5

evaluate flow production

Answer 5

+ can benefit form EOS which reduces costs
+ most efficient
- machinery can be expensive
- customisation is limited

Question 6

what is batch production

Answer 6

• when groups of the same products are produced
• then production is stopped and changed to produce a different batch of products
• used when the business sells in limited quantities for a limited amount of time

Question 7

evaluate batch production

Answer 7

+ can benefit from EOS
+ Productivity is higher than job production
- requires careful coordination to avoid shortages ]
- money is tied up in stock
- completed batches need to be stored which could be costly

Question 8

what is cell production

Answer 8

• when the flow production line is split into ‘cells’ that account for significant portions of the finished article

Question 9

evaluate cell production

Answer 9

+ job enrichment, workers don’t have such specific repetitive tasks
+ Cells take pride and produce quality
+ allows for customisation in each cell, which could boost sales
- recruitment and training are more important
- allocation of work needs to be balanced between cells so production still flows

Question 10

how do you calculate productivity

Answer 10

• number of output / input (person or machine)

Question 11

what are the 2 types of productivity

Answer 11

• labour productivity = output / number of workers
• capital productivity = output / number of machines

Question 12

what factors influence productivity

Answer 12

• employee motivation, staff can be given both financial and non-financial incentives
• skills and education of staff, workers are more autonomous and less supervision is needed
• working practices, flexible and adaptable workplaces
• capital employed, machinery is less likely to make mistakes and can operate for longer

Question 13

define competitiveness

Answer 13

the ability of a business to maintain or grow sales or market share

Question 14

what’s the link between competitiveness and productivity

Answer 14

• if the firm is more productive, they produce more with the same level of resources
• this lowers costs, this allows a business to either pass these reduced costs to consumers or enjoy higher profit margins

Question 15

define efficiency

Answer 15

• the ability of a business to use its production resources as cost-effectively as possible
• often measured in terms of average cost per unit

Question 16

how do you calculate average cost per unit

Answer 16

total costs / number of units produced

Question 17

explain the difference between efficiency and productivity

Answer 17

efficiency is about reducing the waste, effectively using all resources
whereas
productivity is producing high amounts of units in a short amount of time

Question 18

what factors influence efficiency

Answer 18

• relocation or downsizing
• investment in capital equipment, upgrading tech or machinery
• delayering the organisational structure
• reconsider design mix
• lean production, holding little stock or using as few resources as possible

Question 19

a firm can be both capital intensive and labour intensive, explain both of these terms

Answer 19

labour intensive = more workers and less machinery
capital intensive = more machinery and few workers

Question 20

when is labour intensive production used

Answer 20

• when labour is cheap
• when delivering a service
• when production is small

Question 21

when is capital intensive production used

Answer 21

• large scale production of standardised products
• when labour costs are high

Question 22

evaluate capital-intensive production

Answer 22

+ low costs
+ Consistency and precision
+ Machines can work for longer
- high maintenance costs
- breakdowns can cause delays
- limited flexibility in production

Question 23

evaluate labour intensive production

Answer 23

+ low costs when laboure is cheap
+ allows workers to be creative
+ workers are more flexible than machines
- workers can be unreliable
- training and recruitment costs
- people require management

Question 24

a business needs the right balance between labour and machines, why can this be difficult

Answer 24

• if the production process is complex
• if there are labour shortages
• if businesses have limited finances to fund machinery