3.4 Operations

Question 1

6 operational objectives

Answer 1

Quality, cost, added value, volume, dependability, environment

Question 2

4 operational measures

Answer 2

labour productivity, capacity, capacity utilisation, unit costs

Question 3

factors influencing labour productivity

Answer 3

skills, fixed assets, organisation + external factors (suppliers etc..)

Question 4

labour productivity formula

Answer 4

output per period divided by no. of employees

Question 5

labour productivity formula 2

Answer 5

Revenue divided by no. of employees.

Question 6

labour productivity formula 3

Answer 6

labour hours divided by no. of units produced

Question 7

5 types of lean production methods

Answer 7

Time based management, simultaneous engineering, cell production, just in time, kaizen

Question 8

Importance of efficiency

Answer 8

Minimise unit costs = possibly give a competitive advantage, max profit margins

Question 9

Define capacity utilisation

Answer 9

% of the maximum capacity the business is operating at in a given period with their set of resources

Question 10

How to increase capacity utilisation

Answer 10

New tech, introduce ‘slack’, seasonal staff overtime, outsourcing

Question 11

How to decrease capacity utilisation

Answer 11

breakdown in machinery, poor maintenance, employee disruption

Question 12

Capacity utilisation formula

Answer 12

(Actual level of output divided by max. level of output) x100

Question 13

Why produce at <100% capacity?

Answer 13

Lower/seasonal demand, avoid rushed production, demotivating, loss of sales if repairs required or sudden changes in demand

Question 14

Define productivity

Answer 14

Efficiency of output over a given period of time.

Question 15

Ways to improve productivity

Answer 15

Training, motivation, capital investments, improve quality/organisation

Question 16

What is lean production

Answer 16

efficiency method = minimise waste, staff + unit costs

Question 17

Define Kaizen

Answer 17

continuous improvement and small changes to improve quality and efficiency (create a culture in the bus)

Question 18

Just in time benefits

Answer 18

lower storage costs, less working capital tied up, less likely for stock to perish

Question 19

Just in time drawbacks

Answer 19

Delayed supplied = possibility of no stock if delayed, high initial investment in stock control tech

Question 20

5 points of waste hierarchy

Answer 20

Avoidance/minimisation, reuse, recycling, recovery, disposal

Question 21

Types of waste

Answer 21

Over produce, defects, motion waste, excessive stock holding, waiting, poor ergonomics

Question 22

Define Economies of Scale

Answer 22

Unit costs fall as output rises

Question 23

5 internal economies of scale

Answer 23

buying, tech (specialist equip), marketing, network, finacing

Question 24

Explain external economies of scale

Answer 24

Reductions in unit costs benefit external companies when their industry expands

Question 25

Who benefits from External EoS

Answer 25

Suppliers

Question 26

Define diseconomies of scale

Answer 26

Unit costs rise as output rises

Question 27

Why can diseconomies of scale happen?

Answer 27

Too high capactiy utilisation, poor communication, breakdown of staff

Question 28

What is the resource mix

Answer 28

Capital intensive and labour intensive

Question 29

symptoms of labour intensive

Answer 29

Higher labour than capital costs, high variable costs = low BEP, benefits when access to low cost labour

Question 30

symprtoms of capital intensive

Answer 30

Capital costs higher than labour, mainly fixed costs = higher bep, access to LT + low cost financing

Question 31

Why is it important to meet customer expectation of quality

Answer 31

Customers are more: demanding, knowledgable (web), prepared to complain, able to share info of poor quality

Question 32

4 costs of poor quality

Answer 32

depleted customer base, ££££ to replace customers, wasted materals, competitive disadvantage

Question 33

3 quality methods

Answer 33

Quality control, quality assurance, total quality management

Question 34

Quality control is:

Answer 34

checking and reviewing production, detects defects not prevent

Question 35

Qualty assurance is:

Answer 35

focused on design/development stage = quality 'built in'

Question 36

Total quality management means:

Answer 36

Everyone responsible for ensuring quality = business attitude

Question 37

5 drawbacks of tqm

Answer 37

requires strong leadership, £ in training, bureaucratic potentiality, cost vs benefits, must trust staff

Question 38

TQM is concerned with?

Answer 38

what is causing waste, where is quality dropping?

Question 39

3 Benefits ot TQM

Answer 39

Motivational, reduce waste, no inspection costs

Question 40

Define outsourcing

Answer 40

Delegating a process to an external provider

Question 41

5 influences on outsourcing

Answer 41

Cheaper, quality (specialist supplier?), flexibility, help op objective, speed

Question 42

Influences on stock levels

Answer 42

unpredictability, perishability, rent, eos, supplier reliability, competetion