Operation Strategies Flashcards
What are the six main performance objective?
Quality Speed Dependibility Flexibility Customisation Cost
Name the different types of operation strategies
- Performance objective
- Outsourcing
- New product service design and development
- supply chain management
- technology
- inventory management
- global factors
- overcoming resistance to change
- quality management
PONSTIGOQ
What are the performance objectives in quality?
Quality of design
- high grade materials
- care and presentation
- aesthetically pleasing
- long lasting and functional
Quality of conformance
- how well does the product meet the standards to the prescribed design.
- does not have to be high quality
- cheap plastic toy may meet quality of conformance
Quality of service
- how reliable the service is
- how well the service meets the specific needs of the client
- how timely or responsive the service is
What are the goals for speed?
Reduced wait times
Shorter lead times
Fast processing times
How is dependability a performance objective?
Dependibility refers to how consistent and reliable goods are. How long do products last?
What is flexibility in performance objective?
Refers to how quickly operation processes can adjust to changes in the market. This can be done through increasing service providers and technology
What are the two approaches to product design and development?
First arises from a consumer approach to product development. Preferences and desires of consumers from research determine which products are designed.
Second arises from innovation in technology that appeals to consumers as it provides greater functionability.
List the steps involved in product design and devlopment
Market research and specification development
Product design and prototype development
Prototype testing and assesment
Product refinement and production processes refined
Production and product launch
What are the four things whih must be taken into consideration during product design and development process?
Quality
Supply chain management
Capacity
Cost
In service delivery it must have positive explicit and implicit factors. Define these terms.
Explicit service refers to the tangible adpect of service such as expertise, time, skill and effort.
Implicit refers to the internal feeling. Which come froms the psychological wellbeing and being looked after.
What are the three key aspects in supply chain management?
Sourcing (global sourcing)
E-commerce
Logistics
Define sourcing and how would an effective manager source correctly?
Sourcing or procurement refers to purchasing of inputs for transformation process. Effective manager will:
- asses consumer demand
- determine quality of inputs
- assess how responsive supplier is
- evaluate cost of supplies
What are the four trends in scm?
Supplier rationalisation
Vertical integration
Cost minimization
Flexible/ responsive supply chain processes
Define super rationalisation
Business assess effectiveness of suppliers and only keep supplier which can be better utilized and reducing suppliers
Define backwards vertical inegration
Refers to when a business buys a supplier. Supplier should be treated as a profit centre and increases efficiency and processess
Define cost minimisation in SCM
Cost minimisaton in SCM refers to offshore outsourcing. Low cost resource and inputs
Explain the flexible or responsive supply chain processes
Notion of lean process is evident to minimize wastage. Business would not overstock but only order when necessary.
How is global sourcing a factor in SCM?
Global sourcing refers to businesses purchasing supplies or services without being constrained by location.
Advantages include cost reduction and expertise
Some disadvantages include logistics, storage and distribution in products and managing different regulatory conditions between nations.
Define e commerce
E commerce involves the buying and selling of goods and services via the internet.
What is e procurement
Many businesses have online supply systems which allows business to buy stock when needed. This is called business to business arrangement (b2b).
Define logistics
Logistics is a term broadly reffering to distribution but also includes:
- transportation
- use of storage, warehousing and distribution centres.
- materials handling and packaging
Define outsourcing
Outsourcing involves the use of external providers to perform business activities. When outsourcing is performed by external providers that specialize in a particular business function, it will do so at a lower cost and greater effectiveness
Explain the four various options for outsourcing
Creation of shared services - in house outsourcinf that creates an in house centre that performs work for multiple subsidiaries
Use of fee for service arrangement - engaging a supplier with fixed services at a predetermined price
Joint ventures - business engages outsourcing service providers but provider can outsource to other businesses as well
Use of a build operate transfer approach - offshore outsourcing and involves contractinf with external organisations. Detailed agreed level of services with KPIS
What are some advantages of outsourcing?
Efficiency and cost saving: access to cheaper labour, skilled labour in offahore locations lead to cheaper labour.
Improvements to in house performance - business which outsources can focus on core competencis
What are some disadvantages of outsourcing?
Payback and costs: refers to time it takes to pay cost of oursourcing
Loss of control of standards and information security - loss of control due to service providers completing task and not business
Communication and language barriers
Differentiate between leading edge technology and established technology
Leading edge technology is most advanced or innovative at any point of time.
Established technology has been developed and widely used.
Define inventory
Refers to amount of raw materials, work in progress and finished goods that a business has on hand.
What are some advantages of holding stock?
Consumer demand is met when stock is avaliable
Reduces lead times and order delivery
If business buys in bulk costs can reduce due to economies of scale
What are some disadvantages involved in holding stock?
Costs associated with holding stock
Invested capital capital cannot be used elsewhere
What are the three inventory evaluation methods?
FIFO (first in first out)
LIFO (last in first out)
WAC (weighted average cost)
What are the three aspects in quality management?
Quality control - inspection, measurement and intervention
Quality assurance - application of international quality standarss
Quality improvement - total quality management and continuous improvement
How is quality control used in quality management?
Quality control reduces problems and defects in the product by using inspections at various point
Define quality assurance
Quality assurance involves the use of a system to ensure that set of standards are achieve in production. This is done through taking a series of measurements and assessing them again pre determined quality standards. Aspects of quality in qa include:
- notion of fitness for purpose
- desire to achieve right first time
What are two aspects of quality improvement?
Continuous improvement - ongoing commitment to inprove ongoing goods or services
Total quality management - hollistic approach, focuses on managing the whole business to deliver quality to customers.
What are the factors which cause resistance to change?
Financial factors can cause resistance to change this may be from a lack of capital to invest in change
Physchological/ emotion can resist change
How is financial costs a resistance to change?
Cost of purchasing new equipment, cost of retraining staff, costs according to legal regulations
Define inertia
Inertia is a term used to describe a psychological resostance to change
How can a manager manage change effectively?
Managers must introduxe change at a constant pace which can be absorbed and integrated into business, evaluate impact of change, change must be supported by employee participation.
What are some change management strategies?
Lower resistance to change through communication
Possible outsourcing to reduce pressure on business
Global factors can be an opportunity. What are the 4 opportunities within global factors?
Global sourcing
Economies of scale
Scanning and learning
Research and development
How is economies of scale a global factor?
When a business decides to expand globally it must increase its inputs. Economies of scale refers to purchasing and producing on a larger scale. Price will reduce per unit as production increases. This can lead to cost minimization and possibly increae profit
