Definitions Flashcards
Operations Management
Consists of all the activities in which managers engage to produce goods or services. For example, strategic planning.
Total Quality Management (TQM)
An ongoing, organisation-wide commitment to excellence that is applied to every aspect of the organisation’s operation.
Describe one difference between operations management of a manufacturing organisation, and a service organisation.
Manufacturing organisation’s customer contact is limited while service organisation have high customer contact.
Manufacturing outputs can be stored while service outputs are consumed at point of sale.
Manufacturing outputs can be seen while service outputs are intangible.
Explain relationship between operations management, productivity and business competitiveness.
In operations management, the transformation of inputs into outputs, and organisation will gain a competitive edge by increasing productivity.
Productivity is a measure that monitors how well an organisation can produce more outputs for the same amount of inputs.
Three areas of operational competitiveness
- Compete on Quality, such as evaluating processes to ensure minimal defect rates.
- Compete on Cost, such as ensuring stable production processes with limited interruption.
- Compete on Speed of delivery, such as developing faster feedback mechanisms.
Define productivity
Productivity is the total value of outputs produced by the transformation process divided by the total cost or amount of inputs.
Explain how technology can help improve productivity and reduce costs.
The use of latest technology has resulted in organisation’s being able to make full use of their inputs, therefore leading to greater productivity and quality.
The use of new technology allows for better time efficiency in its operations process and a better quality output.
This allows companies to reduce wastes and costs, make better use of their human resources and speed up production and ensure quality.
Explain key elements of an operations system. (MPFEFT)
Inputs- are the resources that are used to produce its goods or services (materials, people, facilities and equipment, finance information and time).
Transformation Process- an activity the organisation undertakes that transforms the inputs into outputs.
Output- the finished product or service that the organisation offers to its customers.
Discuss importance of social responsibility for LSO’s and explain how “ “ is engaging in ethical behaviour
Social responsibility requires an organisation to do what is right to reduce economic, social and environmental impacts on wider community and ecosystem
LSO’s are expected to act in the interests of wider community, as global citizens, and not just meet financial expectations of its shareholders.
Performance indicators
-Total number of clients/customers-
A comparison of the number of customers between periods can show the level of productivity in the business.
Factors to consider in deciding on optimal location of operations.
- Proximity to customers
Certain locations are easier to generate revenue in due to their proximity to customers and markets - Site costs
