Chapter 2 - Influences on operations management

Question 1

Name all the influences on operations management

Answer 1

Globalisation, technology, quality expectations, cost-based competition, government policies, legal regulation, environmental sustainability, corporate social responsibility

Question 2

Define globalisation

Answer 2

Globalisation refers to the removal of barriers of trade between nations, characterised by increased integration between national economies

Question 3

Define supply chain

Answer 3

Supply chain refers to the range of suppliers a business has and the nature of its relationship with those suppliers

Question 4

Define global web

Answer 4

Global web refers to the network of suppliers a business has chosen on the basis of lowest overall cost, lowest risk and maximum certainty in quality and timing of supplies

Question 5

Define technology

Answer 5

Technology is the design, construction and application of innovative devices, methods and machinery upon the operations processes

Question 6

Define quality

Answer 6

Quality refers to how well designed, made and functional goods are, and the degree of competence with which services are organised and delivered

Question 7

What are the quality expectations with goods?

Answer 7

Quality of design: How well the product is made
Fitness for purpose: How well the product does what it was designed to do
Durability: How reliable and long-lasting the product is

Question 8

What are the quality expectations with services?

Answer 8

The professionalism of the service provider
Reliability of the service provider
Level of customisation

Question 9

Define cost-based competition

Answer 9

Cost-based competition is derived from determining breakeven point and applying strategies to create costa advantages over competitors

Question 10

Define fixed costs

Answer 10

Fixed costs don’t depend on the level of operating activities within a business

Question 11

Define variable costs

Answer 11

Variable costs vary in direct relationship to the levels of operating activity or production

Question 12

Define compliance costs

Answer 12

Compliance costs are the expenses associated with meeting the requirement of legal regulations

Question 13

Define environmental sustainability

Answer 13

Environmental sustainability means that business operations should be shaped around practices that consume resources today without compromising access to those resources for future generations

Question 14

What are the 3 main aspects of environmental sustainability?

Answer 14

Sustainable use of renewable resources, a reduction in the use of non-renewable assets and the application of the precautionary principle

Question 15

Define precautionary principle

Answer 15

The precautionary principle requires that, where environmental impacts are uncertain, a business undertake actions that are most likely to cause the least environmental impact

Question 16

Define carbon footprint

Answer 16

Carbon footprint refers to the amount of carbon produced and entering the environment from operations

Question 17

Define corporate social responsibility

Answer 17

CSR is the business actions based on respect for people, community and the environment

Question 18

Define triple bottom line

Answer 18

Triple bottom line refers to the financial profitability, social impact and environmental impact of a business

Question 19

What’s the difference between legal compliance and ethical responsibility

Answer 19

Legal compliance refers to businesses abiding by the law, whereas ethical responsibility encompasses social community and environmental concerns