Operations

Question 1

Capacity Utilisation

Answer 1

Current output as a percentage of potential output.

Question 2

100% Capacity

Answer 2

• Cannot take on new orders.
• Quality may decrease.
• Delays if machinery breaks, due to it being constantly on.

Question 3

Increase Capacity

Answer 3

• Staff hours/motivation/training.

- Increase Capital Goods.

Question 4

Under Utilisation

Answer 4

May increase costs, fixed costs spread over less output increasing unit costs.
Higher capacity creates economies of scale decreasing variable costs.

Question 5

Quality

Answer 5

This is when the good/service meet customer expectations.

Question 6

TQM

Answer 6

This is when the idea of quality is instilled throughout the business, where quality is checked after each stage.

Question 7

Quality Assurance

Answer 7

Each Stage

Question 8

Quality Control

Answer 8

Final Stage

Question 9

Benefits of Quality

Answer 9

• Less wastage rate.

- Motivation increase productivity Recognition.

Question 10

Suppliers

Answer 10

Those that offer goods/services of which match or exceed the needs of the business.

Question 11

Factors Affecting Suppliers

Answer 11

Price,
Payment Terms,
Quality,
Capacity, Reliability, Flexibility

Question 12

Technology

Answer 12

Goods of which make the firm more cost effective and efficient, requiring updating and maintenance.

Question 13

Pros/Cons of Tech

Answer 13

Staff costs fall, more accurate/reliable

Staff lose jobs, high initial and maintenance costs.

Question 14

Improve Cashflow

Answer 14

Short term/long term finance i.e factoring, loans, sale and leaseback.
Lengthen the credit time to pay back suppliers.

Question 15

Improve Profits

Answer 15

Raise the price of the good/service.

Reduce the cost of production of the good/service.

Question 16

Pros/Cons - Internal/External Recruitment

Answer 16

Internal - Know them, Shorter/less expensive.
Another vacancy to be filled, cause resentment.
External - New ideas, experience organisat, pool choose.
Don’t know candidate, long and expensive, induction req.

Question 17

Pros/Cons of Off/On Training

Answer 17

Off - Specialists, intensive, new theories/equip.
Expensive, may not access tools at work, not productive.
On - Easy to organise, costs lower, job specific.
Not productive, bad practices passed on, bad coms.

Question 18

Determinants/Improving Competitiveness

Answer 18

Price (reduce costs, staff tend to be the biggest),
Quality, Type of Market.
Customer Service (increases customer loyalty, increased by setting higher standards of training and recruitment).