Operations Management

Question 1

Benefits of optimal location

Answer 1

Lower costs
Closer to customers
Overcoming trade barriers
Add to brand image and exposure

Question 2

Factors affecting location

Answer 2

Resources
Cost of location ( land / Labour )
Demographic factors
Geographic factors
Government grants

Question 3

Economies of scale

Answer 3

Output increases costs decrease

Types
Marketing, technical, purchasing, managerial, financial

Bulk buy / capital intensive / employ managers

Question 4

Internal diseconomies of scale

Answer 4

When outputs increase and costs increase

Communication, motivation and co-ordination

Everyone feel recognised / more people harder to communicate

Question 5

Benefits of benchmarking

Answer 5

Develop a better understand of customers and competitors
Have fewer complaints and more satisfied customers
Reduce waste and improve quality

Question 6

Role of IT and AI

Answer 6

Better communication
Faster transfer of info
Better links with retailers
Better data analysis

Question 7

Impact of Enterprise resource planning

Answer 7

Better inventory control
Lower costs can equal lower prices
Response to change increases
Better workforce flexibility

Question 8

Lean production

Answer 8

Zero delays
Zero inventories
Zero mistakes
Zero waiting
Zero wastage

Question 9

Limitations of lean production

Answer 9

Flexible workforce who willing to take in extra responsibilities
Investment and training of staff
The right suppliers, reliable
Investment in technology

Question 10

Why do projects fail

Answer 10

Not enough planning
Time and cost underestimated
Ignore the potential problems

Question 11

CPA pros

Answer 11

Identifies critical stages for management to focus on
Sets targets for business - improve motivation
Planning of resources can save time and money

Question 12

CPA limitation

Answer 12

Relies on estimates
Can be inaccurate
Depend on reliability of suppliers
Shows the quickest way and does not necessarily mean the right way

Question 13

Red ocean

Answer 13

Competing in existing market
Attempting to fight and beat competition
Fighting for existing demand
Focus on USP or low cost

Question 14

Blue ocean

Answer 14

Creating and uncontested market
Aiming to make competition irrelevant
Creating new demand

Question 15

Porter 5 forces

Answer 15

Highlights strategic changes
Rivalry
Entry threat
Buyer/ supplier power
Substitute threat

(Compare to competitors )
Identify threats / competitors etc Plan
Only external

Question 16

Swot analysis

Answer 16

Identify strengths / maintain
Identify weaknesses to adapt
Identifies opportunities to exploit
Identify threats ( competitors)

Question 17

Boston matrix

Answer 17

Analyses product
Cash cow -into question mark
Star maintain
Compare products

Question 18

Decision trees pros

Answer 18

Make managers think about different options - create solutions
Show probability of success - how likely outcome is
Decision based on logic rather than emotions
Makes business consider possible outcomes

Question 19

Decision trees cons

Answer 19

Values are estimated therefore not accurate
May suffer from bias or overestimate of possibility of success
Doesn’t take into account what might be ethical for business, may be profitable but damaging to environment

Question 20

Ansoffs matrix

Answer 20

Market penetration
New product development
New market development
Diversification

Question 21

Lewin force field analysis

Answer 21

Driving forces
Restraining forces

Restraining if know knowledge of what can stop successful change then can adapt to counteract that