Increasing Efficiency And Productivity Flashcards
What is efficiency
Maximising the output achieved from given inputs including machinery materials and people
how does capacity utilisation affect a business
Whether rescources are being used efficiently or whether they are lying idle
How will low capacity utilisation affect a business
Rescources are not being made to work effectively for the business this will result in high unit cost
How will high capacity utilisation affect a business
mean the firm is sweating its assets, made to work hard resulting in lower unit costs and affect quality
Why is capacity important
Shows ability to Match supply to demand and can impact workers motivation
how to not under use rescources
- increase demand
- downsize, sell assets
- lease of spare capacity
How to not over use rescources
- try to reduce demand
- outsource
- increase capacity
what does increasing labour productivity cause
Lowers labour cost per unit and therefore unit cost
How can labour productivity be increased
- training
- increase motivation
- new technology
- improve recruitment
Issues with increasing labour productivity
- can Impact quality
- can impact customer satisfaction
- increase waste
- employees may feel used
what are the rescources available to a business
- land
- labour
- capital
What do businesses need to bare in mind when choosing the mix of resources
- process taking place
- what is affordable/achievable
