Operations Flashcards
Labour productivity formula?
Total output / number of employees
Capacity utilisation formula?
(Total output / maximum capacity) x100
Capacity formula?
(Actual output / maximum output) x100
Problems with being under utilised?
Paying for space they don’t need or use
How to increase capacity utilisation?
Sell assets that aren’t being used
Further promotion to increase demand
Problems with being over utilised?
Unable to cope with sudden increase in demand
If a machine breaks down they couldn’t cope with demand
How to ease capacity utilisation?
Increase prices to reduce demand
Outsource production (manufacturing)
What it Kaizen?
Continuous improvement
How can kaizen help a car manufacturer?
Can speed up production making it more efficient and productive
How does Just in time work?
A business orders the stock it needs just before it needs it
Advantages of just in time?
Saves on storage costs for a business
Reduces waste of materials (especially if perishable goods)
What does time-based management do for a business?
Helps the business avoid wasting time on the production line making them more productive
Benefits of time-based management?
Quicker response times (reduced lead times) to meet changing market and customer needs
Faster new product development
Reduction in waste
More efficiency
What is outsourcing?
Getting another business or organisation to provide the service for you
How can outsourcing help a business?
Reduce costs
Decrease capacity utilisation
Quality control checks?
The product as it is being made on the production line
Quality assurance checks?
The product at the end of the line before it is sold
Total quality management is?
An attitude to quality where the aims are zero defects and total customer satisfaction
What does setting operational objectives do?
They allow employees to work towards a target
With incentives can improve productivity
Can help managers plan the stages of a products completion
Internal influences of operational objectives?
Low productivity
The need to cut costs and become more efficient
Changes to the marketing mix for the business
External influences on operational objectives?
Competitors releasing a product
Technological change
Economic changes
