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Business Unit 2 > Operations > Flashcards

Operations Flashcards

1
Q

What is meant by added value

A

The difference between what a business spends to produce its goods or services, and the price that customers are prepared to pay

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2
Q

What are the ways to add value

A
  • Branding
  • Promoting
  • Increasing price
  • Adding new features or variants
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3
Q

What is Job production

A

When individual products are made one at a time to meet specific customer preferences

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4
Q

What is Batch production

A

A method used to produce similar items in groups, stage by stage

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5
Q

What is flow production

A

A continues and uninterpreted method of production, flow production connects a series of workstations into an assembly line

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6
Q

What are the advantages of job production

A
  • High quality product
  • Customized orders, better customer satisfaction
  • Workers involved in entire production process, increasing motivation
  • Premium pricing
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7
Q

Disadvantages of job production

A
  • Production costs are likely to be high
  • Longer Production time, smaller output
  • High machinery costs, as specialist equipment is needed
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8
Q

Advantages of Batch production

A
  • Allows flexible production
  • Inventories of part-finished goods can be stored and completed later
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9
Q

Disadvantages of batch production

A
  • Making many small batches can be expensive
  • If production runs are different there may be additional costs and delays in preparing equipment
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10
Q

Advantages of Flow production

A
  • Low storage costs due to low inventory levels
  • Benefits from economies of scale, as these business are usually large
  • Lower transportation costs, short distances
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11
Q

Disadvantages of Flow production

A
  • High initial costs of machinery to set up the business
  • A lack of flexibility, as all products need to be identical or fairly similar
  • Employees may become bored or demotivated due to their limited range of tasks
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12
Q

Why are high productivity levels important to a business

A
  • Enables businesses to keep their costs per unit as low as possible
  • Ensures employees are doing their job and that your not wasting money on labor
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12
Q

What is meant by productivity

A

Being more productive means the same input, such as the number of workers, produces more output, over the same period of time

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12
Q

Calculation for productivity

A

Output produced over a time period
_________________________________
Number of employees

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12
Q

Ways to improve productivity

A
  • Increase motivation
  • Invest in employee training
  • Better communication
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13
Q

What is meant by capacity

A

The maximum output that a business can produce in a given period with the available resources

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14
Q

What is meant by capacity utilisation

A

A measure of the level to which a business assets are being used to produce output, it compares current output to the maximum possible output a business can produce using all of it’s assets

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15
Q

Capacity utilisation calculation

A

Current output
____________________ X 100 = %
Maximum output

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16
Q

What is the ideal rate of capacity utiliasation

A

90% as this allows for adaption and change, as well as not overworking employees and equipment

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17
Q

What is CAD

A

Computer Aided Design - Enables firm to design and test products on screen without building a physical prototype

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18
Q

What is CAM

A

Computer Aided Manufacturing - The use of computer software to control machines and produce goods by lifting, cutting and moving materials

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19
Q

What are Robotics

A

A field of engineering that deals with the design, construction, operation, and application of robots. Robots are often used in manufacturing and other industrial settings to perform tasks that are repetitive or dangerous

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20
Q

What is information technology

A

The hardware and software used to create, store, transmit, manipulate, and display information and data

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21
Q

What are the advantages of technology in operations

A
  • Higher productivity
  • Stronger security
  • Competitive advantage
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22
Disadvantages of technology in operations
- Increased dependency on technology - Newer the technology, higher the purchase and maintenance costs - Security risk, in relation to fraud
23
What is meant by Lean production
Aims to cut costs by making the business more efficient and responsive to market needs, and by cutting out waste, while ensuring quality
24
What is meant by Just in time
Occur when a business holds no stock and instead relies upon deliveries of raw materials and components to arrive exactly when they are needed
25
What is meant by Kaizen
An approach of constantly introducing small incremental changes in a business in order to improve quality and/or efficiency. This approach assumes that employees are the best people to identify room for improvement, since they see the processes in action all the time
26
What is meant by Cell production
Where workers are organised into multi-skilled teams, with each team responsible for particular part of the production process
27
What is meant by time based management
A form of lean production that is a general approach that recognises the importance of time and seeks to reduce the level of wasted time in the production processes of a business
28
What is meant by Quality
Meeting the needs and expectations of customers with your product or service
29
What is meant by quality control
How a company measures product quality and improves it if need be, this can be done with methods such as, testing products, reviewing manufacturing processes, and creating benchmarks
30
Advantages of quality control
- Reduces chance of poor quality products being sold - Not all employees need to be trained as inspectors to look for faults
31
Disadvantages of Quality control
- Faults only found at the end of production - High wastage costs - Reworking faulty products cost time and money
32
What is meant by quality assurance
The processes that ensure production quality meets the requirements of customers. This is an approach that aims to achieve quality by organising every process to get the product 'right first time' and prevent mistakes ever happening
33
Advantages of Quality assurance
- Improved operational efficiency - Ensures supplier quality - Lower maintenance costs
34
What is meant by total quality management
A structured approach to overall organizational management. The focus of the process is to improve the quality of an organization's outputs, including goods and services, through the continual improvement of internal practices
35
What are quality chains
The series of chains inter-relating different departments within and outside the organisation. It is a continuous process.
36
What is meant by Empowerment
Giving employees greater control over their working lives, this means that employees plan their own work, take their own decisions and solve their own problems
37
What is monitoring
A process that helps businesses gather, present and interpret important operational data, by using a range of monitoring techniques, such as appraisals, digital analytics and customer feedback, a business can identify potential weaknesses and implement change
38
What is meant by team work
When a group of individuals work together toward a collective goal in an efficient manner
39
What is meant by zero defects
A way of thinking and doing that reinforces the notion that defects are not acceptable, and that everyone should "do things right the first time." The idea here is that with a philosophy of zero defects, you can increase profits by eliminating the cost of failure and increasing revenues through increased customer satisfaction
40
What are quality circles
When small groups of workers of different levels in the firm come together to discuss and solve problems in production, all opinions are valued and respected
41
What is meant by benchmarking
A process in business where a company evaluates various aspects of its processes in relation to best practice within the same sector. It's essentially a method of comparing your business's performance metrics with those of the best and highest performing businesses in your sector
42
Why is Stock control important
- Increased efficiency - Reduce costs Efficient stock control helps businesses balance inventory levels to meet customer demands without holding too much excess stock. Tracking product flow helps businesses forecast demand and make informed decisions on stock replenishment.
43
What does a Stock control diagram look like
Search that shit up nogger
44
Advantages of just in time
- Prevents over production - Minimising waiting times and transport costs - Saving resources by streamlining your production systems
45
Disadvantages of just in time
- Dependent of accurate demand forecasts - Often unable to benefit from economies as businesses buy in small quantities
46
What is meant by computerised stock control
Used to monitor stock levels, the stock management system can automatically reorder stock when it reaches the minimum stock level
47
What is meant by innovation
The ability to conceive, develop, deliver, and scale new products, services, processes, and business models for customers. Successful innovation delivers net new growth that is substantial
48
What are the benefits of innovation
- Competitive advantage - Improved productivity - Reduced costs - Increased turnover and improved profitability - Improved brand recognition and value
49
Drawbacks of innovation
- High expenses - Reluctance to change - ethical considerations
50
What is meant by economies of scale
The cost advantage experienced by a firm when it increases its level of output
51
What is purchasing economies of scale
The advantages that can sometimes occur as a result of increasing the size of a business, this allows it to buy in bulk, by buying a large number of products at once, it could negotiate a lower price per unit than its competitors and there for benefit from economies of scale
52
What is Technical economies of scale
As a business gets bigger it can purchase more advanced machinery and equipment. They can also purchase larger buildings to produce more. As unit costs fall, the firm will make more profit per unit
53
What is Financial economies of scale
As a firm gets larger it's able to access business loans more easily at lower rates of interest, due to a lower risk of lending the firm money
54
What is Managerial economies of scale
When large firms can afford to invest in management technology and employ dedicated managers. The managers and their systems can improve the productivity of the whole production process by overseeing it effectively
55
What is meant by diseconomies of scale
When a company or business grows so large that the costs per unit increase. It takes place when economies of scale no longer function for a firm
56
What are coordination issues
- poor communication issues - Lack of standardization and consistency in processes and procedures - Resistance to change and new ways of working
57
What is a Communication issue in business
When there is a lack of internal communication or when management withholds information about important decision
58
What is a motivation issue
When there is a lack of direction or clarity in goals
59
Why are small businesses able to survive
Smaller businesses may be able to offer a more personal service than bigger business and therefore create brand loyalty. Furthermore, the products that they sell may be unique. This is especially the case in niche markets

Business Unit 2 (4 decks)

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