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Business Studies > Operations > Flashcards

Operations Flashcards

1
Q

Define operations.

A

The business processes that involve transformation, or more generally, ‘production’.

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2
Q

What does strategic mean?

A

refers to long-term, broad aims affecting all key business areas.

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3
Q

What does the strategic role of operations management involve?

A

involves allocating resources so that all aspects of business meet customer’s needs.

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4
Q

What is cost leadership?

A

involves aiming to have the lowest costs or to be the most price-competitive business in the market.

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5
Q

What does cost leadership involve balancing?

A

Balance between cost and quality.

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6
Q

What is a key component of cost leadership?

A

Economies of scale

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7
Q

Define economies of scale.

A

refers to costs savings that occur as a result of an increase in the scale of a business’ operations.

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8
Q

Economies of scale =
as _____ increases, _____ decreases.

A

As output increases, costs of production decreases.

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9
Q

What is good/service differentiation?

A

distinguishing products in some way from those of competitors.

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10
Q

Define standardisation.

A

The making of products that are homogeneous or identical.

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11
Q

How can a business differentiate goods?

A
  • varying the actual features of the good
  • varying product quality
  • varying any augmented features
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12
Q

How can a business differentiate services?

A
  • varying amount of time spent on a service
  • varying the level of expertise brought to a service
  • developing self-service options
  • flexibility
  • no fuss
  • varying the quality of materials or technology used in the delivery of the service.
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13
Q

What is the advantage of cross branding or strategic alliances?

A

adds value to products by offering consumers added benefits from a cross-branding arrangement.

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14
Q

What are some examples of cross branding arrangements?

A

coles + shell
Woolworths + caltex

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15
Q

What are standardised goods?

A
  • those that are mass produces, usually on an assembly line.
  • uniform in quality and meet a predetermined level of quality.
  • generally produced with a production focus.
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16
Q

What are customised goods?

A
  • those that are varied according to the needs of customers.
  • produced with a market focus
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17
Q

What is emphasised in operations processes for perishable goods?

A
  • high standards of quality, safety and cleanliness in production.
  • short lead time and distribution that is efficient.
  • suitable packaging and storage processes in production and distribution.
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18
Q

What must be integrated in operations processes for non-perishable goods?

A
  • manage all aspects of quality in production
  • effective inventory management strategies to be highly responsive to market demand and minimise waste.
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19
Q

what are intermediate goods?

A

When goods are processed more than once because they become inputs that require further processing.

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20
Q

What is an example of standardised services?

A

fast food industry

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21
Q

What is an example of customised services?

A

Doctors, lawyers

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22
Q

Define interdependence.

A

The mutual dependence that the key business functions have on one another.

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23
Q

When does interdependence occur?

A
  • when each key business function area is committed to the same business goals as the other key areas.
  • they each work in a coordinated and collaborative way to achieve these goals.
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24
Q

What are some examples of interdependence between business functions?

A

Sales + marketing
Finance + administration
Operations + R and D

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25
Q

What are the influences on operations

A
  • globalisation
  • technology
  • quality expectations
  • cost based competition
  • government policies
  • legal regulation
  • environmental sustainability
  • CSR
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26
Q

Define globalisation.

A

the removal of barriers of trade between nations.

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27
Q

What is globalisation characterised by?

A
  • increasing integration between national economies
  • high degree of transfer of capital, labour, intellectual capital and ideas, financial resources and technology.
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28
Q

What is the positive influence of globalisation on operations?

A
  • provides a source of market opportunities from other nations and to other nations.
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29
Q

What is an example of globalisation?

A

Apple
- electronic goods are designed in the USA, manufactures in China, and sold globally.

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30
Q

Define technology as an influence on operations.

A

The design, construction and/or application of innovative devices, methods and machinery upon operations processes.

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31
Q

What are the positive influences of technology on the administrative level of operations?

A

organisation, planning, decision making, control of operations processes.

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32
Q

What are the positive influences of technology on the processing level of operations?

A

manufacturing, logistics and distribution, quality management, inventory management, supply chain management and sourcing.

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33
Q

How can globalisation be a threat to business?

A
  • more competition:
  • businesses that become global and apply cost leadership principles can undercut the market and dominate.
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34
Q

What influences how global businesses target global markets?

A
  • product design
  • choice of location for manufacturing facilities
  • management of quality, logistics, inventory management processes.
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35
Q

Define quality.

A

Specific reference to how well designed, well made and functional goods are, or the degree of competence with which services are organised and delivered.

36
Q

What does quality inform in operations processes?

A
  • the way products are designed, created and delivered.
37
Q

Define cost-based competition?

A

determining the breakeven point and then applying strategies to create cost advantages over competitors.

38
Q

In what ways can a business lower costs to maximise profits?

A
  • eliminate waste
  • achieve economies of scale
  • produce high volume output
  • bulk buy inputs
  • use automated production systems
  • produce standardised products for larger markets
39
Q

In what ways can a business lower cots and increase productivity at the same time?

A
  • stable production processes with limited interruption.
  • Use resources to optimum advantage.
  • streamline production processes.
  • Update facilities and equipment with new and efficient technology.
  • Provide training and development to increase skills and capabilities of staff.
40
Q

What are some examples of government policies which influence operations?

A
  • taxation rates
  • requires materials handling practices
  • work health and safety standards
  • industry training requirements
  • policies relating to public health
  • environmental– carbon tax
  • trade and industry
  • employment relations
41
Q

What are the positive influences of government policies?

A
  • encourage operations function
42
Q

How does government policies affect business operations?

A
  • political decisions affect the business rules and regulations, which, in turn directly affect the management of various key business functions.
  • encourage innovation and competition in operations function.
43
Q

Define compliance.

A

The range of laws with which a business must comply.

44
Q

What are compliance costs?

A

The expenses associated with meeting the requirements of legal regulations.

45
Q

How does legal regulation influence operations?

A
  • shape business practices and procedures.
  • influence how practices and processes are conducted.
  • influences the role of labour in transformation process.
  • environmental protection
  • public health
46
Q

How does legal regulation influence the role of labour in transformation processes? / What specific legal regulations?

A
  • WHS: safety training, protective equipment…
  • Training and development
  • Fair work and discrimination laws?
47
Q

What legal regulations regarding environmental protection influence operations?

A

minimising pollution, eliminating and safely disposing of any toxic residues

48
Q

What legal regulations regarding public health influence operations?

A

any fair trading rules which influence product safety standards and fitness for purpose of products.

49
Q

What are the quality expectations with goods?

A

Quality of design
Fitness for purpose
Durability

50
Q

What does quality of design involve?

A
  • How well the concept has been developed, taking into account customer needs and expectations
  • Nature of the materials used
  • Innovation evident in the design, which minimises waste
51
Q

What does fitness for purpose involve?

A
  • How well the product does what it is designed to do.
  • How easy it is to use.
52
Q

What does durability involve?

A
  • How reliable and long lasting the product is.
  • How easily it can be repaired and maintained.
53
Q

What are the quality expectations with services?

A
  • Professionalism of the service provider.
  • Reliability of the service provider.
  • Level of customisation.
54
Q

What does professionalism of the service provider involve?

A
  • The cleanliness and layout of the physical facilities.
  • The courtesy and professionalism of the staff and the care taken in dialogue and interactions.
55
Q

What does reliability of the service provider involve?

A
  • How efficiently the service is performed.
  • Overall levels of competence.
56
Q

What does a level of customisation involve?

A
  • How well the particular needs of the customer are fulfilled by the service provider through the application of expertise and experience.
57
Q

What are some of the laws affecting and shaping business operations in Australia?

A

Commonwealth:
Racial Discrimination Act 1975
Sex Discrimination Act 1984
Disability Discrimination Act 1992
Work Health and Safety Act 2011
Fair Work Act 2009

NSW:
Workers Compensation Act 1987
Anti-Discrimination Act 2004

58
Q

What does environmental sustainability mean for a business?

A

Means that business operations should be shaped around practices that consume resources today without compromising access to those resources for future generations.

59
Q

What are the ways a business is environmentally sustainable?

A
  1. the sustainable use of renewable resources.
  2. a reduction in the use of non-renewable assets.
  3. Application of the precautionary principle.
60
Q

What is the precautionary principle?

A

requires that where environmental impacts are uncertain, a business undertakes actions that are most likely to cause the least environmental impact.

61
Q

What are examples of ways a business can minimise waste?

A
  • recycling water, glass, paper metals
  • reducing carbon footprint
62
Q

What is corporate social responsibility?

A

Open and accountable business actions based on respect for people, community/society and the broader environment. It involves businesses doing more than just complying with the laws and regulations.

63
Q

Give an example of a business showing corporate social responsibility.

A

Kathmandu
- Produces a separate sustainability report providing comprehensive account of commitment to areas of ethical decision making that goes beyond legal requirements.

64
Q

How does Corporate social responsibility influence operations?

A
  • manage the effects of activities on society/community and environment and reduce negative impacts.
  • understand where and how inputs are sourced: drawing only from suppliers that adhere to appropriate standards.
  • shapes processes in a way to minimise environmental damage and waste.
  • recruitment practices draw from wide range of employees, inclusive of all backgrounds.
65
Q

What is the difference between legal compliance and ethical responsibility?

A

Ethical responsibility:
- going further than the law.
- meeting all legal obligations and taking it further by following the intention and ‘spirit’ of the law.

Legal compliance:
- require businesses to follow the letter of the law (prescribed standards of behaviour).

66
Q

Define outsourcing.

A

involves the use of outside specialists to undertake one or more key business functions.

67
Q

What is onshore outsourcing?

A

use of domestic businesses as an outsourcing provider.

68
Q

What is offshore outsourcing?

A

taking the activities to a provider in another country.

69
Q

How can a business reduce compliance costs?

A

outsourcing

70
Q

What is sustainable economic development?

A

Using methods of production that conserve the Earth’s resources for future generations.

71
Q

What are the consumer environmental expectations of a business?

A
  • adopt greenhouse abatement measures
  • encourage development of long-term sustainable strategies.
72
Q

What are the goals of a socially responsible business?

A
  1. expanding the business
  2. providing for the greater good of society
73
Q

How does environmental sustainability and social responsibility impact a business?

A
  • customers can react and stop buying form an unsustainable business.
  • customers will reward socially responsible business, purchasing more
74
Q

How does environmental sustainability and social responsibility impact operations?

A
  • balance between economic and environmental concerns.
  • adopt policies of conservation, recycling, restoration.
  • Growing consumer expectation: products should be ‘clean, green and safe’.
75
Q

Define inputs.

A

The resources used in the transformation process. Some are owned by the business, others are provided by suppliers.

76
Q

What are transformed resources?

A

Those inputs that are converted in the operations process.
- Give operations process a purpose of goal.

77
Q

What are the transformed resources?

A

materials, information, customers.

78
Q

What are materials?

A

the basic elements used in the production process.

79
Q

What are the types of materials?

A

Raw materials
Intermediate goods

80
Q

What are raw materials?

A

The essential substances in their unprocessed state.

81
Q

What are intermediate goods?

A

Goods manufactured and used in further manufacturing or processing.

82
Q

What is information?

A

The knowledge gained from research, investigation and instruction, which results in increased understanding.

83
Q

How does information act as a transformed resource?

A

used to inform how inputs are used, where they are drawn from, which supplies/suppliers…

84
Q

What are examples of external sources of information?

A

Market reports
Stats from industry observers
ABS

85
Q

What are examples of internal sources of information?

A

Business Studies (5 decks)

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