4 - The Use Of Data In Operational Decision Making Flashcards
What Does Operational Data Allow?
A business to measure performance.
What Are The Types Of Operational Data?
(4 Points)
~ Labour productivity.
~ Unit costs (AC).
~ Capacity.
~ Capacity utilisation.
What Does Labour Productivity Measure?
Output per worker.
What Is The Formula For Labour Productivity?
Total Output / Number Of Employees.
What Are Factors Influencing Labour Productivity?
(4 Points)
~ Training.
~ Skills of the workforce.
~ Motivation.
~ Complexity of the product.
What Is Unit Cost?
The average cost of producing a single unit of output.
What Is The Formula For Unit Cost?
Total Cost / Output.
What Are Factors Influencing Unit Costs?
(4 Points)
~ Number of units produced.
~ Labour productivity.
~ Supplier costs.
~ Material usage (Wastage).
What Is Capacity?
Maximum amount of output achievable if all resources are fully utilised.
How Can A Business Increase Capacity In The Long Run?
(2 Points)
~ Acquiring more resources.
~ Bigger premises or more machinery.
How Can A Business Decrease Capacity In The Long Run?
(2 Points)
~ Downsizing resources.
~ Laying off workers, smaller premises or less machinery.
What Is Capacity Utilisation?
Measure of the percentage of potential output being achieved.
What Is The Formula For Capacity Utilisation?
Actual Output / Maximum Output x 100.
What Is Labour Productivity An Indication Of?
(3 Points)
~ Workforce morale.
~ If additional training is required.
~ If labour is being used effectively.
What Is Unit Cost An Indication Of?
(3 Points)
~ Whether average costs are rising or falling.
~ Look to change suppliers.
~ Is waste being managed efficiently.
