CH5: Production, Operations, Purchasing, & Logistics Flashcards
What is TQM?
A philosophy focused on continuous improvement using people and data to enhance processes, materials, and customer satisfaction.
What is the role of the purchasing function in business and its strategic contributions?
The purchasing function ensures the timely acquisition of goods and services needed for operations. It contributes strategically by reducing costs, improving quality, supporting project timelines, and coordinating with other departments. Indirectly, it supports innovation and supply chain efficiency.
What are key steps in the purchasing process and how are vendors selected?
Key steps include initiating a purchase requisition, three-way matching (order, invoice, delivery note), and order finalization. Vendor selection depends on quality, price, reliability, and past performance.
What is the role of production and operations management?
Production and operations management transforms inputs into outputs efficiently. It supports the value chain by ensuring consistent quality and timely delivery, aiming to satisfy customer needs while controlling costs.
What are the main types of production layouts and their characteristics?
Layouts include: process (horizontal grouping), product (vertical grouping), fixed product (immovable product), and hybrid layouts. Each layout suits different production needs and volume requirements.
What are important considerations in designing production layouts?
Effective layouts consider workflow efficiency, flexibility for future changes, and employee comfort. This ensures adaptability, safety, and high productivity.
What is quality control and when should it be applied?
Quality control ensures products meet predefined standards. Inspection should occur during and after production. Integral inspection checks every item, while sampling checks a portion.
What is statistical quality control and how does it manage risk?
Statistical quality control uses data to monitor production. It includes acceptance sampling (with consumer and producer risk) and process control based on probability assumptions to detect variation.
What are quality costs and how are they categorized?
Quality costs include control costs (prevention and inspection) and failure costs. Prevention costs aim to avoid defects, while inspection detects them before delivery.
What is logistics management and what functions does it integrate?
Logistics management plans, implements, and controls the flow of goods and services. It integrates transport, warehousing, inventory, and information systems like logistics software.
How does logistics impact marketing performance?
Poor logistics disrupt delivery, causing customer dissatisfaction. Effective logistics enhances reliability, customer service, and product availability—key components of marketing success.
What are distribution channels and how do they vary in length?
Distribution channels are paths through which products reach customers. Short channels involve direct selling, long ones include intermediaries like wholesalers and retailers.
How has logistics evolved through digitisation and IoT?
Since the 1960s, logistics has shifted from manual to digital systems. IoT enables real-time tracking and coordination. Digitised systems improve efficiency, accuracy, and visibility.
