Operations influences Flashcards
What does influences refer to?
Influences refer to factors outside the business that will have an impact on operations management and how the businesses perform in the marketplace.
What are some operations influences?
- Globalisation
- technology
- quality expectations
- cost-based competition
- government policies
- legal regulation
- environmental suitability
- Corporate social responsibility
What does globalisation have the ability to do for operations management?
Global operations can present cost-saving opportunities fro management if operations managers choose the most appropriate means of sourcing and if they consider the advantages offered by locating different parts of their operations in different countries
Why would a operations manager choose to source globally?
The decision to purchase inputs will be based on a number of factors but the main one is the price. The decision to purchase inputs from overseas will depend on the price
What is a global web strategy?
Operations managers may be able to reduce the cost of operations by purchasing a global web strategy. Global web refers to the location of different parts of the production process in different geographical areas.
What are the reasons for employing a global web strategy?
- Favourable movements in the exchange rate
- The abundance of raw materials
- A plentiful labour supply
- technology
- relatively low transport costs
What is a major influence of technology on operations
A major influence of technology on operations is the need to constantly upgrade equipment and the resultant need to retrain staff. This can be costly for businesses but in many cases, it is essential to maintaining competitive advantage
What is Cost-based competition?
Cost-competition occurs when a business competes with its rivals by establishing prices for its outputs based on costs of productions. In the pricing system, the business adds a profit component to the cost of producing the product. To produce the product, the business incurs fixed costs and variable costs
What is a major tension on operations?
A major influence on operations is the tension between the need to operate at the lowest cost and the importance of offering customers the highest quality possible while engaging in cost-based competition
How do government policies influence operations?
Local government
state or territory
federal
How does the local government affect operations management?
By implement policies
planning powers
implementing policies for providing infrastructure
waste disposal services
regulating parking
How does the state government affect operations management?
Small business and consumer law
payroll tax
OH&S
workers comp
industrial relations
How does the federal government affect operations management?
Trade and commerce overseas
taxation
export bounties
banking
insurance
bills of exchange
bankruptcy and promissory notes
pensions
external affiars
How can legal regulation affect operations?
Common law
What is environmental sustainability?
Environmental sustainability is about meeting the needs of the present generation without compromising the ability of future generations to meet their needs
What is corporate social responsiblity?
Corporate social responsibility is a commitment by a business to operate ethically and contribute to economic development while improving the quality of life of our workforce and the families, as well as the community at large
What do operations managers need to focus on with regards to Corporate social responsibility?
Operations managers need to focus on the quality of their management both of people and processes. People need to be treated ethically and fairly with respect for their rights. Process needs to be implemented so that the highest quality of output can be achieved at the lowest cost with the least impact on the environment
What is meant by legal compliance?
Legal compliance involves making sure that the laws and regulations relating to the operation of a business are sticky observed. Most of our laws are based on ethical principles but this does not necessarily mean that strict compliance with the laws relating to business operations is ethically responsible
What is meant by ethical responsiblity?
In operations, management managers understand value systems and morality or what is right and wrong with regards to the production of goods and services. Ethical managers will implement programs where the operations of a business not only complies with the law but will also build into those programs.
What is social responsiblity defined as?
Social responsiblity of a business is concerned with that business interacting in a positive way in terms of its operations with the local community and improving the quality of life community members
