Operations

Question 1

Operational objectives

Answer 1

Costs
Quality
Speed of response
Flexibility
Dependability
Environmental
Added value

Question 2

Increase in labour productivity leads to..

Answer 2

Fall in cost per unit - less workers, same output

Question 3

Soft strategy to improve labour productivity

Answer 3

Training, teamwork, motivational methods

Question 4

Hard strategy to improve labour productivity

Answer 4

Price rate pay(TAYLOR)
Job threaten , replace workers

Question 5

Labour productivity equation

Answer 5

Output/ no of workers

Question 6

Unit costs

Answer 6

TC/ output

Question 7

Reducing unit costs does..

Answer 7

Higher profit margins -
Can cut selling price and retain same profit margin- more competitive

Question 8

When do unit costs fall

Answer 8

When TC fall but same output is produced

Question 9

How to cut unit costs

Answer 9

Increase labour or capital productivity
Reduce costs of raw materials
Reduce storage costs
Reduce waste

Question 10

Capacity utilisation formula

Answer 10

Actual output/ max output x100

Question 11

What does low capacity utilisation mean

Answer 11

Assets not utilised
Ie, workers not producing enough goods, factories slow

Question 12

What does Hugh capacity utilisation

Answer 12

Under High pressure
Stressful to cope with sudden changes in demand, unexpectedly high order, disappoint customers

Question 13

Target cap U

Answer 13

80-90%

Question 14

Advantage of high cap u

Answer 14

Efficient use of resources
Lower unit cost
Higher profitability- if sold
Motivation for workforce

Question 15

Disadvantages of high cap u

Answer 15

May not be able to to respond to non-standard orders, sudden surge in demand
Lack of time for maintenance and repair
Stress
Impact on strategic planning time ( dont have time to think of bigger picture) chaotic
Impact on quality

Question 16

Why fall in effciency bad

Answer 16

Lowers competitiveness , resources not utilised to full potential , lead to higher unit costs, can result in fall in profit margins, might have to raise prices to compensate, lead to fall in market share. If product is elastic, consumers will switch to alternate

Question 17

Methods of increasing efficiency

Answer 17

Fewer inputs, reduce waste, electricity bills

higher outputs , training, replace labour with capital- Hugh start off but long term

Question 18

Advantages of JIT

Answer 18

Reduced storage cost
Less chance of perishable items becoming out of date
Incentive to improve quality- cant replace
Products can be customised for each order

Question 19

Disadvantages of ~JIT

Answer 19

No economies of scale
Can’t respond/ supply for sudden surge in demand, may loose customers/dissapoint them
Damage to brand if cant meet customer orders
Relies on suppliers, need to maintain good relationship
Customer may experience waiting time

Question 20

Kaizen

Answer 20

Rather than making big changes- continuous improvement
Regular communication with workers, they can contribute ideas to improve production
They know what should be the best changes
Managers prepared to listen and implement new ideas
Workers need genuine decision making planning- no centralises

Question 21

Types of lean production

Answer 21

JIT
KIAZEN

Question 22

Managers best for KAIZEN

Answer 22

Decentralised, join leader
Allow workers to communicate ideas, and managers should listen and implement them -
Need training cost

Question 23

Example of manager using KAIZEN

Answer 23

Continuous improvement, 1% gains in everything they do
- painted floor in veichles that they carried bikes in, see dust easier, dust can comprise tires of bikes- they won Olympics
Took own mattresses , good night sleep, better riders- small, continuous improvements

Question 24

Advantages to kaizen

Answer 24

Find problems quick- ideas from workers, they know the problems
Improve motivation for workers, valued, involved
Reduce waste, and therefore production costs
Reduce capital investment
Easier to implement than big ones

Question 25

Disadvantages of kaizen

Answer 25

Meeting everyday, time consuming , reduce labour productivity Managers may resist change, not implement - traditional view of manager, he makes choices Cost of unsuccessful ideas

Question 26

+ of labour intensive

Answer 26

Each product adjusted to suit customer needs Work varied, improves motivation Customer satisfaction high Workers ideas used to improve production processes

Question 27

- of labour intensive

Answer 27

Highly skilled workers demand high wage Training costs and Time Strike- industrial action Difficulties recruiting right skill level

Question 28

+ capital intensive

Answer 28

Products standardised Higher output- economies of scale Useful for mass production and customisation

Question 29

- of capital intensive

Answer 29

High set up costs Lack of innovation Expensive, change to new products, variations

Question 30

Quality importance

Answer 30

Price- can charge premium price if Hugh quality Impact on brand image Reputation- brand loyalty, repurchase Costs- replacement, dealing with complaints

Question 31

Quality control

Answer 31

Inspectors Monitor quality throughout system of inspection Specific job to control quality- can scrap products Prevent products that are not worthy, getting out to consumers

Question 32

Quality assurance

Answer 32

Staff Involving staff in improving quality assessing throughout production process

Question 33

Benefits of o quality assurance- staff

Answer 33

Empowered to make decisions- motivation Problems spotted earlier r Fewer wanted products

Question 34

Drawbacks of quality assurance- staff

Answer 34

Training cost Delays in production process Cultural change - used to centralised, hard to adapt

Question 35

Total quality management TQM

Answer 35

Whole business is about quality All objectives revolve around quality Responsibility of all employees

Question 36

Flexibility

Answer 36

Business ability to adapt its supply to match demand

Question 37

Volume flexibility

Answer 37

Deal with sudden changes in demand

Question 38

Product flexibility

Answer 38

Adapting peridots to suit customer needs/ producing a range of products

Question 39

Delivery flexibility

Answer 39

Being able to get product to wherever customer is - delivery doesn’t have this, cant deliver everywhere

Question 40

Mass customisation

Question 41

Mass production

Answer 41

Products on large scale Baked beans

Question 42

Mass customisation

Answer 42

Many tailored products , individual preferences, Flexible production line

Question 43

+ of mass customisation.

Answer 43

Ability to charge premium price Increased profit Martians Highly satisfied customers Comp advantage Economies of scale, raw materials - large output High price, low cost = high profit margins Motivated workforce, different production, variety of tasks, more interesting

Question 44

- of mass customisation

Answer 44

Heavy investment - training, communcations( specific model made), capital equipment that is adaptable Reliance on suppliers, may need multiple Getting it ‘right first time’- might not

Question 45

+ to part time staff

Answer 45

Lower costs Staff value flexible time Gives busines access to different skills

Question 46

- to part time

Answer 46

Recruitment and training costs Motivational issues Negative effect of 0 hour contract, staff morale, publicity

Question 47

Influence of choice of supplier

Answer 47

Price Payment terms Quality Capacity Reliability Flexibility