Chapter 8 Flashcards
Capital-Labor Substitution
An organization’s ability to substitute labor for capital or vice versa as production increases.
Experience curve
The reduction in per-unit costs that occur as an organization gains experience producing a product or service.
Functional Strategies
The strategies pursued by each functional area of a business unit, such as marketing, finance, or production.
Human Capital
The sum of the capabilities of individuals in an organization.
Just In Time Inventory System
An inventory system, popularized by the Japanese, in which suppliers deliver parts just at the time they are needed by the buying organization to use in its production process.
Knowledge Management
People and their skills and abilities (i.e., knowledge capital) represent the only resource that cannot readily be reproduced by a firm’s competitors. Knowledge capital must be effectively leveraged if high-performing firms are to remain as such over the long term.
Learning
The increased efficiency that occurs when an employee performs a task repeatedly.
Process R & D
R & D activities that seek to reduce the costs of operations and make them more efficient.
Product/Service R & D
R & D activities directed toward improvements or innovations in the quality or uniqueness of a company’s outputs.
Total Quality Management
A broad-based program designed to improve product and service quality and to increase customer satisfaction by incorporating a holistic commitment to quality as seen through the eyes of the customer.
