miss duddigan-resource management Flashcards
what are the 4 methods of production
job
batch
flow
cell
job production
-used for one-off times produced by skilled workers
-e.g wedding dress
disadvnatges of job production
-each product take long time to make
-means productivity is lower
-skilled workers will need to be payed high wages
-means increased costs
-less chance of economies of scale as products need to be made individually rather then in bulks
-higher unit costs means higher prices must be charged
advantages of job production
people will get a unique product hand made
so customers are more willing to pay higher prices
flow production
use of an assembly line to produce identical products
e.g chocolate bars
ech worker does there task then passed on
like a flow
advantages of flow production
most efficient
can be continious, no stoppages
can use machines
can operate 24 hours
allows a benefit for economies of scale to be achieved as can buy raw materials in bulk
alllows for more competitive/lower prices charged
mass market most liekly tp use as sell large volumes of identical products
batch production
makes small batches of differnt products
products in each small batch are identical to one another
one batch made, production stopped and equipment is adjusted e.g cleaned
then next batch of products are made
advantages of batch production
higher production then job production as each batch consists of identical products
however
lower production than flow production as have to clean/ adjust q=equipment between each batch as not identical to the batch before
can buy raw materials in bulk so can achieve economies of scale
disadvantages of batch production
might have to store these raw materials
stoppage between each batch to adjust equipment
disadvnatges of flow production
machinery may stop working
as producting identical products workers may get bored and leave meanign absentissm is higher
repitiive tasks can be boring
cell production
flow divided into a set of tasks
each task completed by work group
e.g for cars each gorup may be responsible for assembiling each part of a car
advantages of cell production
may cause increase in pride as workers feel more accomplished by doing something with group of people
advantages of machinery with levels of productivity
-can operate 24 hours
-can carry out tasks quicker then humans
-work for more hours in day, dont need rest breaks
-
disadvantages of machinery on productivity
-may break down
-to alter production, may need to install whole new software
-for humans, they would be much easier to alter production
efficiency
when production happens at an overall minimum average cost
ways in which a business can increase efficiency
increasing productivity
-cutting costs involving production of a product
-
labour intensive firms
uses more people rather then machinery
e.g NHS as need more people rather then machinery to solve problems
labour intensive countries e.g China where labour is cheap
advantages of labour intensive firms
dont havr to buy expensive machinery
humans can be retrained to carry out new task wheras for machinery, it will need to be brought/replaced
can suggest ways to imporve quality
disadvanatges of labour intensive firms
harder to manage people then amchines e.g emotions feelings
people can be unreliable (call in sick)
wont work without rests/breaks
capital intensive firm
firm that uses more machinery rather then people
larger firms tend to be more capital intensive as need more to be produced
advanatges of capital intensive firms
operate 24 hours
dont need breaks
easier to manage
more precise
no chnace of human error
disadvnatages of capital intensive firms
very expensive to buy
only usually suited for one task wheras humans can do multiple differnt tasks
machine breaks down, can lead to long production delays
risks sales being missed and repuation decreasing
if machine replaces workers, workers may feel unmotivated
capacity utalisation
how much capacity a business is using
capacity utilisation calculation
current output divided by maximum output times 100
disadvantages of working at over 100% capacity utalisation (over-utalisation)
no down time-machines are on all time-
no time for equipment maintenace shortening time machine can wokr for
no margin of error-everything has to be perfect everytime which can cause stress to workers
mistakes are more likely as workers are working flat out
ways a business can increase their capacity
-using their facilities more. making people work 2 times a week rather then 1
-buy more machines
-increase staff levels
-if rise in demand is temporary, business might outsource
what is outsourcing
where business uses another firm to do some work on its behalf
e.g packaging it in store with own label
under utalisation
inefficient as not getting good use of machinery already have
disadvantages of under utilisation
workers may lose motivation as dont have enough to do
also less chnace of promotion
negative brand image e.g shelves werent all full gives bad impression on customer
managing stock
store of raw materials
max amount of stock business wants to hold usually depends on how large stock room is
flow prodcution would mean lot of stock needed
what is a minimum amount of stock level called
buffer stock
depends on warehouse, whether product is perishable or not
perishable
things tht go out of date e.g food
advantages of buffer stock
whats needed to avoid running out of stock
mass markets more likely to need more buffer stock as have more to consisitently produce and if not, can risk customer loyalty being lost
also good incase theres a sudden increase in demand
disadvantages of buffer stock
to hold buffer stock, costs are involved
e.g storage costs for warehouse or refridgerator etc
increase in wastage costs if products are perishable and not used in time
why do dynmaic markets have a high risk of wasted stock
as makret constantly changing meaning things go out of fashion very quickly
increases risk of opportunity cost-money could go to something better
what is high stock in costs
this is where business ends up with too much costs being spent on holding stock
bad for smaller businesses with little money
also bad for dyanmaic markets whos markerts are consistently changing
what is stock out costs
where business runs out of stock
demotivatinf for staff as wont have any work to do
lean production
effient form of production
focuses on waste minimisation
using as few resources(time and money) to make product
can also involve recycling and re-using materials in house
just in time management
method of lean production
aims to reduce waste of materials
having as little stock as possible
products avaliable just in time for when customer needs them
advnatges of JIT managment
storage costs are reduced
cash flow improved as money not tied up in stock
less waste as less out of date or damaged stock lying about
business more flexible so can deal with changes in demand
disadvantages of JIT management
having litle stock means firm relies on lots of frequent deliveries from suppliers
can be stressful for staff
supplier may be unreliable and firm may end up running out of stock
can not benefit from economies of scale as not buying in bulk
quality control
checking goods after you’ve made them or when arrive from suppliers to check anything from them
often done by quality inspectors
quality assurance
introducing measures throughout production process
checking throughout
product checked at each stage of production process
advantages of quality asurance
-prevents product being chucked away as checked throughout
-prevents errors
-prevents aim to get it right first time/pressure
-
advanatges of qulaity control
detects errors and puts them right
more consistent not having to check throughtout stopping/starting
why can quality assurance be more motivating than quality control
workers get to self check their work which can be highly motivating
what is total quality management
where quality is the centre of everything a business does
big part of businesses culture
idea that every employee in every department focuses on quality
advantages of TQM
all employees are involved meaning can help them bond as a team
disadvantages of TQM
can demotivate staff-can be lot of effort too consider quality in all parts of the firm
quality circles
where they meet at regular intervals to discuss quality control issues
great way to get staff involved
disadvanatge-managemnt meant not listen to floor staff and suggestions may be unrealistic
kaizen approach
lean production method
employees reducing waste and constantly finding ways to be more efficient
cheap for business to introduce
disavnatge-only small changes at a time
what is inflation
overall increase of a price in goods and services within an economy
exchange rates
value of one currency in terms of another currency
example of an exchange rate
e.g. 1 pound worth 1.60
if then goes up so 1 pound worth-appreciated
also said to strengthen power of another
barriers to entry
how easy it for new firms to enter market
price war. undercut prices by predatory pricing
buyer power
buyers want as low as price as power
they have the power
supplier power
supplier wants as high price as possible
firm can make long term contract
threat of substitutes
how likely customers are to buy an alternative
businesses can differentiate their product to keep customers interested
