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Operations Flashcards

1
Q

Purchasing economies

A

Being able to purchase in larger quantities at lower average cost

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2
Q

Financial economies

A

Negotiate cheaper loans, and the time to pay it back

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3
Q

Managerial economies

A

Employment of more specialist managers

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4
Q

Technical economies

A

Purchase more effective capital equipment

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5
Q

Marketing economies

A

More effective methods of marketing

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6
Q

Risk bearing economies

A

Spread risk by diversifying into different products

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7
Q

Concentrated economies (E)

A

Skilled labour in a specific region or suppliers located nearby

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8
Q

Information economies (E)

A

Easier access of data or market research

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9
Q

Infrastructural economies (E)

A

Building facilities and improving facilities

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10
Q

Diseconomies of scale

A
  • communication problems from increased staff
  • storage costs will rise
  • morale reductions
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11
Q

Capacity utilisation

A

Extent to which a firm or nation employs its installed productive capacity

= (actual output / maximum possible output) x 100

+ less wastage
+ EOS
+ improves pay
+ better reputation

  • maintenance and breakdowns
  • additional orders
  • over capacity
  • quality impacts
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12
Q

Stock control

A

Processes and controls used by a business to secure that it has sufficient stock for its purpose

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13
Q

Types of stock

A

Raw materials
Finished products
Work-in-progress

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14
Q

EOQ (Economic order quantity)

A

Order quantity that minimises total inventory holding costs and ordering costs

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15
Q

+ - of holding stock

A

+ meet demand and fluctuations in demand
+ EOS
+ buffer stock

  • storage costs
  • depreciation of stock
  • opportunity cost of paying for stock
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16
Q

Calculate average stock levels

A

(Max stock level + Min stock level) / 2

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17
Q

JIT (just in time)

A

Minimises inventory and increases efficiency - orders only arrive when production is scheduled.

+ reduce storage
+ less working capital in stock
+ avoids wastage and build up

  • complex
  • no EOS
  • reliant on suppliers
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18
Q

Electronic methods of stock control

A

LIFO - last in first out
FIFO - first in first out
EPOS - electronic point of sale - automatic reorder of stock via barcodes

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19
Q

Kanban

A

Track production and order when needed

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20
Q

Kitemark BS 5750 (E)

A

Owned by British Standards Institution, Identify products where safety is most important

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21
Q

ISO-9000 (E)

A

Set of international standards on quality management and quality assurance

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22
Q

Zero defects (E)

A

Minimise number of defects in manufactured products and services as much as possible

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23
Q

ABTA (I)

A

Support and promote a thriving and sustainable travel and tourism industry

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24
Q

Investors in people (I)

A

Designed to improve performance through employee training

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25
Wool mark (I)
Certification for pure wool products that meet quality standards
26
Logistics
Making sure correct products are procured and will arrive when needed
27
Key factors in logistics
- warehousing - customer requirements - information systems - transportation
28
Reshoring
Returning production and manufacturing back to original country + certainty around delivery time + minimise supply risk + reduce supply chain complexity
29
Offshoring
Relocation of business process (manufacturing) to a different country + lower costs + better skilled + free trade areas - longer lead time - communication - poorer quality - exchange rates
30
Outsourcing
Hiring party outside company to perform service or create goods
31
Subcontracting
Production of particular part of product is undertaken by another firm + keep labour costs low + specialisation + increased productivity - no direct control - lack of staff development - time consuming
32
Critical path analysis CPA
Helps businesses operate efficiently by identifying quickest way a project can be completed + Reduce risk Careful assessment Better allocation of resources Useful overview - Based on estimates Doesn’t guarantee success Complicated
33
Total float
Amount of time activity delayed without delaying finish time of project LFT this activity - Duration - EST this activity
34
Free float
Amount of time activity is delayed without delaying next activity EST next activity - duration - EST this activity
35
PERT
Estimated duration of project (Optimistic time + (4 x likely time) + pessimistic time) / 6 + more realistic + simple -difficult to judge
36
Gantt charts
Graphical representation of order and duration of tasks within a project + visual representation + easy to monitor - doesn’t show criticality - cant see est or lft - cant calculate floats
37
TQM total quality management
Efficient usage of all resources
38
Quality control
Checking products to see if they meet required quality standards
39
Quality assurance
Focus on ensuring quality whilst producing products
40
Location demand factors
Customer convenience Labour skills Site suitability Expansion potential
41
Supply factors
Labour costs Land costs Energy costs Transport costs Community factors
42
Reasons for growth of service industry
Decline in manufacturing Competition from abroad Lack of resources Cheaper from abroad Specialisation Globalisation Comparative advantage Skilled labour
43
Important aspects of customer service
Empathy Communication skills Patience Confidence
44
Why is customer service important
Adds value Retains customers Improves reputation
45
Impact of bad customer service
Damaged reputation Increased costs Loss of profits
46
How to measure quality service quality
Speed Price Quality Satisfaction
47
Methods of measuring customer service
Customer satisfaction score Surveys Mystery shopper Bench marking
48
How to improve customer service
Ask Bench marking Training Role play
49
Operations management objective
Maximise amount produced
50
Market orientated
Business designs products based on customer needs and wants
51
Market orientated
Business responds to customer needs and wants and designs products accordingly
52
Product orientated
Business develops products based on what it is good at doing
53
Innovation
Developing and introducing new things to a product or taking an invention and making it sellable
54
Job production
Meet specific requirement of customers - one off
55
Job production +
Meet customer needs Quality product Motivational Flexible Add value
56
Job production -
Time consuming High costs Labour intensive Cash flow issues High wages No EOS
57
Batch production
Many similar items going through different stages of production in batches
58
Bath production +
Quicker than job Lower average cost Cheaper Eos
59
Batch -
Downtime Cost of machinery Could fail Requires quality checks Demotivated staff
60
Flow production
Product moves continuously through production process
61
Flow production +
Eos Large quantities produced quickly Automated Less labour costs
62
Flow production -
High set up costs Less differentiation Production stops if one machine doesn’t work
63
Cell production
Mass production that divides work into teams known as cells, each responsible for particular part of production process
64
Cell production +
Improve communication Multiskilled workers Motivation Efficiency
65
Cell production -
Less intensive use of machinery Training and set up costs Staff centred Disagreements Employees may want to specialise in one job
66
Factors that influence selecting or changing production method
Nature of products Cost of machinery Workforce Finance Customers Competition Stakeholders Size of business
67
R&D
Process that enables creation of new and improved products to meet needs of customers
68
Problems with R&D
Cost Risk Copying Limited protection of ideas Changes in tech Customer wants
69
Morphological studies
Grid system with range of possible alternatives that generates ideas cheaply and quickly
70
The product launch stages
- market research - product testing and development - distribution of product to outlets - promotional launch
71
Division of labour
allocation of labour into specific tasks, intended to increase productivity
72
Specialisation
Where workers perform specific tasks
73
Division of labour / specialisation +
Tasks done quicker Increase productivity Increase output Lower unit costs Eos
74
Div of labour / specialisation -
Tasks repetitive High labour turnover Automation may take over
75
Productivity
Output / input
76
How to increase productivity
Monitoring Target setting Investing in tech Rewarding jobs Team work Factory layout Training Division of labour
77
Improved productivity +
Shorten delivery time Competitive EOS Less training costs Pay off debts Encourages investment Monitor targets
78
Lean production
Focus on cutting out waste, whist ensuring quality and improving efficiency
79
Time based management
Reducing level of wasted time in production
80
Kaizen
Constantly introducing small incremental changes and improvements into the business
81
Ergonomics
Process of changing the work environment
82
Jidoka
Machine automatically stops working upon detecting problem, then business fixes it Adon lights - Different coloured lights show seriousness
83
Benchmarking
Comparing business practices to other practices or other businesses in order to understand where business needs to be changed
84
Statistical process control (SPC)
Continuous monitoring of a process while its operating
85
Wastage rates calculation
(Number of rejects produced / total number produced) x 100
86
Benchmarking -
Limited access to other businesses Insufficient employees to improve Lack of finance Inflexible workforce
87
Location supply factors
Labour costs Land costs Energy costs Transport costs Language Political stability Government assistance
88
Quality circles (kaizen)
Groups specifically brought together to identify potential improvements
89
Kaizen + -
+ small changes less likely require major investment + encourage employees to take ownership + help business remain competitive -reluctant employees -pressured employees
90
Ergonomics + -
+Time saving in using machines +More motivated employees - equipment +Long term save costs -cost of customisation -potential breakdown of equipment
91
TQM + -
+motivated employees +improves quality +increased customer loyalty -resistant to change
92
Time based management + -
+quicker response time +faster product development +Reduction in waste -under pressure employees -resistant to change
93
Jidoka + -
+ saving money + production target more likely to be met + different coloured lights determine seriousness -short term disruption and cost
94
Kanban - JIT
+ lower stock hold + less working capital tied up in stock + stock less likely to perish + less time spent checking -little room for mistakes -high reliance on suppliers -no spare product -complex stock system

Business (8 decks)

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