3.3.4

Question 1

Eight types or operational objectives

Answer 1

-quality (improving or maintaining)
-costs
-flexibility (respond to what customers want)
-efficiency (better use of resources)
-innovation
-environment (laws and customers may pressure)
-speed of response
-dependability (wether that be customers towards the business or the business towards suppliers)

Question 2

Internal factors that could influence operational objectives

Answer 2

-Nature of the product (service or product) a product will need more R&D whereas service may be capacity utilisation.
-other departments

Question 3

External influences on operational objectives

Answer 3

-Competitors performance
-market conditions
-demand for the product.

Question 4

What is the formula for capacity utilisation? (%)

Answer 4

Output
————— x 100
Capacity

Question 5

What is capacity utilisation?

Answer 5

How much capacity the business is using.

Question 6

Unit cost formula?

Answer 6

Total costs
—————-
Unit output

Question 7

Five ways a business can increase its capacity?

Answer 7

1) using facilities for more of the working week
2) buy more machines and staff needed to operate
3) staff levels employ more permanent staff or in the short term employ many part time or get staff to work overtime.
4) increasing productivity
5)outsourcing.

Question 8

Labour production formula?

Answer 8

Output per period
—————————-
Number of employees

Question 9

What is lean production?

Answer 9

Efficient form of production that need waste (or time and resources) to a minimum.

Question 10

2 advantages of Just in time production?

Answer 10

Storage costs are reduced and cash flow improved as money is not tied up in stock
-business is more flexible so it can cope with changes in demand.

Question 11

What is JIT?

Answer 11

Keeps stock levels very low.

Question 12

Disadvantages of JIT

Answer 12

-No stock means no customers can’t be supplied during production strikes.

-Suppliers have to be reliable because there isn’t much stock of raw materials to keep production going.

Question 13

What is meant by CAD how Can a business use it?

Answer 13

Use’s computers to design new products or make alterations to existing products. CAD produces 3D mock ups on screen. This can be useful for marketing products eg. New kitchens.

Question 14

What is meant by a capital intensive business?

Answer 14

Uses more machinery and relatively few workers.

Question 15

Advantages and disadvantages of capital intensive

Answer 15

Advantages:
-cheaper than manual labour in the long term
-machinery is able to work 24/7

Disadvantages:
-high set up costs
-long delays if there is malfunctions