BUSMANCHAP2 Flashcards
operations management
All the activities in which managers engage to produce goods or services.
Concerned with the strategies that are used to create, operate, and control the transformation of inputs (resources) into outputs (products).
Effectiveness:
the degree to which a business has accomplished its stated objectives
Efficiency:
how well a business uses resources (inputs) in achieving its objectives
Key Elements of an Operations System
inputs
processes
outputs
Key Elements of an Operations System - inputs
Natural resources: raw materials and parts consumed or converted by the transformation process
Physical resources: the plant, machinery, equipment necessary to conduct operations
Human resources: the people involved in the operations function
Financial resources: funds/money required to start and continue operations
Information from a variety of sources: contributes to the transformation, but is often overlooked as it is hard to quantify as an asset
Time: coordinating resources within appropriate timeframes limits costs and wastage
Key Elements of an Operations System - processes
The transformation stage of inputs into outputs
Key Elements of an Operations System - outputs
the results of a business’ effort - the final products (goods or services)
Characteristics of Operations Management - manufacturer
-will transform inputs into tangible products (physical goods; can be touched)
-There is very little customer involvement in the production of the good - production and consumption are not linked.
Characteristics of Operations Management - service business
- will transform inputs into intangible services (experiences; cannot be touched)
-Services cannot be stored ahead of time for future purchase, and the customer will likely need to be present when the service is being delivered.
Technological Developments
- Businesses need to acquire up-to-date technology in order to compete effectively.
- Manufacturing businesses use tech to speed up processes and get more out of raw materials. This improves productivity, as well as makes the transformation process more cost effective.
tech developements:
- automated production lines
- robotics
-computer aided design
-computer aided manufacturing techniques
-AI
-online services
tec dev - Automated Production Lines
Machinery and equipment arranged in a sequence that add components to a good as it passes through each step, controlled by computers
tech dev - robotics
On an automated production line, allows production to continue for long periods of time, as robots work without complaint or demands for wages rises, in conditions that might be considered unacceptable for human empl
adv and dis of automated production lines
adv: reduce need for human labour - reduce costs, n produce at faster rates
dis: loss of jobs as fewer emp are required
tech dev - computer aided design (CAD)
A computerised design tool that allows businesses to generate multiple product possibilities by providing it with parameters
CAD DIS AND ADV
adv: prduct designs can be produced at a faster rate without the need to erase and redraw
dis: computer software can crash, resulting n possible loss of work
tech dev - Computer-Aided Manufacturing (CAM)
after CAD comes CAM - involves software directing and controlling machines to make a product. CAM relies on the information generated by CAD.
CAM dis and adv
adv: allows bus to pridyce a greater consistency
dis: may be expensive
tech dev - Ai
ability of a robot controlled by a computer to do tasks that are usually done by humans because they require human-level intelligence
A.I. in the workplace:
- Writing / scripting / proofreading / editing documents
-Facial recognition
-Chatbot customer service
-Scheduling
-Graphics generator
tech dev - online services
website and/or web presence
online services adv and dis
adv:business is accessible for sales 24/7
dis: websites can go down and can be fustrating for custoers leading to bus losing sales or reputation affected
materials managment
strategy that manages the use, storage, and delivery of materials to ensure the right amount of inputs is available when required in the operations system.
materials management involves:
recieveing materials, storing mat safely, identifying ongoing mater req, reducing holding of surplus stock, controlling release of materials into production process
mat managament: Inventory:
goods and materials held as stock by a business
mat managament: Materials handling:
the handling of goods in warehouses and at distribution points.
Reduction in accidents, breakages, and spoilages
mat managament: Forecasting
A materials planning tool, that relies on datas from the past and present, as well as analysis of trends, to attempt to predict future events.
forecasting adv and dis
strength: ensures that bus maintain approprite level of materials for operation system without overproducing
dis: innacurate, does not always guarantee that past events will continue into the future
mat managament: Master Production Schedule:
a plan that details what is to be produced, in what quantities, how, and when.
mat managament: Materials Requirement Planning:
involves developing an itemised list of all materials involved in production to meet the specified orders.
MRP: Consider:
lead times required by suppliers, exact numbers of inputs required required, how much inventory is on hand
MRP AND MPS adv and dis
strengths: allows bus to avoid overproducing or underproducing
limitation: both rely on accurate info, f not, errors will likely occur in the materials planning process
mat managament: invenotry control
Ensures that costs are minimised and that the operations system has access to the right amount of inputs when required.
Costs can be kept to a minimum by not allowing materials to remain idle (unused)
Stocktakes
when stock is physically counted and compared to the computer records - if there is a mismatch, there are problems with stock control (theft, breakages, etc.)
mat managament: just in time
ensures that the right amount of materials and parts (inputs) will arrive only as they are needed in the operations process.
- reduces storage costs
- suppliers of inputs must be chosen carefully and be reliable to deliver in order to avoid holding up the finished product
just in time S&L
strenghths: holding less stock in storage reduces storages costs- improves effieciency an effectiveness
limit: materials must be recieved at the appropriate time - failing to do so can bring a production line to a halt
managemntt of quality - Quality:
the degree of excellence of goods or services, and how well they fit their stated purpose - Reliable, durable, nice design
managemntt of quality - quality control
use of inspections at various points in the production process to check for problems and defects.
managemntt of quality - quality control 2
The business has set the benchmarks and standards for quality, and relies on inspections defects after the products, g&s have already been produced - in that way, it is reactive (after the fact).
managemntt of quality - Impact on effectiveness and efficiency:
If products are of good quality, the business will be effective in meeting its objectives of increased sales and profit.
Efficiency will be improved as there will be less wastage.
managemntt of quality - quality assurance
The use of a system so that a business achieves set standards in production - preventing quality issues before they occur, making is proactive.
managemntt of quality - Total Quality Management
An ongoing, business-wide commitment to excellence that is a responsibility shared by all the members of the business.
managemntt of quality - (Total Quality Management) chacateristics of TQM
- Proactive, as it aims to reduce quality issues before they occur
- Introducing TQM can be expensive and time-consuming
-Relies on full participation of all employees
managemntt of quality - (Total Quality Management)
Employee Empowerment
Employee involvement is essential to TQM - use quality circles as a way to empower employees by Teaming up ten workers meeting regularly to solve problems related to process, design or quality, Make use of data of the problem, and make presentations to management with their ideas
management of quality -
(Total Quality Management)
Continuous Improvement
The ongoing commitment to evaluating and improving the way things are done in a business. striving for improvement
(Total Quality Management)
customer focus
Keeping the customer at the heart of everything an employee does.
waste minimisation
reducing the amount of unwanted or unusable resources created by the business’ production process.
minimising wastes in a bus..
- Reduces the costs of production of the business, e.g. costs of waste removal
- Demonstrates concern for the natural environment (CSR), improving reputation of the business.
3 Rs
(reduce reuse recycle)
reduce
creating less waste to begin with.
Less waste generated = less waste to be cleaned up = decreased costs of a business= improved efficiency and effectiveness.
ways to reduce
- just in time
- introducing proactive quality man system (like quality assurance or TQM)
- introducing reactive quality management system )like quality control
- introcce robotics or automated prduction lines
ways to reduce (just in time).
Only having the right amount of materials and parts arrive just as they are needed for production
-less need for storage of these materials going unused needing to be stored.
-reduces storage costs and lowers the risk of materials wastage whilst in storage.
ways to reduce
- Introducing a proactive quality management system (like quality assurance or TQM
will identify defective processes and products before they occur
ways to reduce -
Introducing a reactive quality management system (like quality control)
help identify potential wastage issues that can be resolved before the new production cycle begins
ways to reduce
Introduce robotics or automated production lines
to remove human involvement in repetitive, dangerous tasks to avoid defective products and reducing waste at the source.
Reuse -
taking old or unwanted items that would otherwise be thrown away and finding a new use for them.
Recycle -
changing discarded materials into new products in order to avoid using more fresh resources.
lean managment is
an approach that improves efficiency and effectiveness of operations by:
Eliminating waste
Improving quality
In lean management, ‘waste’ is
anything that reduces the speed of production at the lowest possible cost.
4 principles of lean management
1.pull: customer demand determines the rate of production. avoids overproduction and minimises waste by avoiding stocks becoming lost and damaged
2.one piece flow: involves work-in-prgress moving through operation process one stage at a time and all steps must be focused on, removing any unnecessary activities. it elminates idle time for emp
3.zero defects: strives for perfection, identifies errors closely as possible
4.takt: production rate aligns with customer demand, the averge time that passes between production starting on one unit of a produt to the next. minimises waste by aboiding overproduction
lean man adv and dis
adv: increased customer satisfaction
dis: costant focus on improvement and eliminating waste can result in stress
Global sourcing -
seeking the most cost-efficient materials and other inputs globally.
global outsourcing - taking adv of…
- low-cost skilled labour,
- low-cost raw materials,
-lower taxes and low trade
global outsourcing adv and dis
adv: reduces cost
dis:diff to monitor quality of inputs
Overseas manufacture (or ‘offshoring’) -
when a business produces goods in a country that is different to the location of the business’ headquarters. consider risks like extra transport costs, longer lead times
diffference between global outsorucing and overseas manufacture
Global outsourcing is diff as business contracts specific business operations to an external entity in another country.
Whereas overseas manufacture is where a business sets up part of their operations in another country (but still run it directly under their business name).
s&l of oversease manufacture
strenghs: improved quality due to access to expert knowledge and services
weaknesses: management may have less control over production process
