Operations Management Flashcards
How do you calculate adding value
Price you charge-price of making
What is adding value
The process of production by which a product becomes of higher value to the purchaser
What are 6 ways of adding value
Convenience Speed Brand name Hugh quality Unique selling point Good design
What is labour productivity
The amount of goods or services procured in a specific amount of time or by how many workers
What is the calculating for labour productivity
Total produced/number of workers
What are 4 ways we can measure productivity
The total we produce
Labour productivity
Waste
Quality
How can we increase productivity 3
Increase investment in modern equipment
Improve skills of employees
Improve motivation
What is capacity utilisation
The proportion of maximum possible output that is used
What is the calculation for capacity utilisation
Current output/max possible output x100
How do you increase capacity 2
Increase demand for products
Reduce the maximum capacity by cutting hours/staff
What are 3problems with working at full capacity
Can’t meet change in demand
Workers overburned
No down time for machines
What is reorder level
Level of stock at which a new order is placed
What is order quantity
Typical amount ordered
What is buffer stock
Stock level that will always be held in case of problems with delivery
Jit- what have the orders changed to when using this system
More regular and smaller
What 3 types of stock will a business have at all times
Raw materials
Half finished
Completed
What 4 costs are involved in holding stock
Opportunity
Liquidity problems-cash is held up in stock
Increased storage
Increased wasteage-
What is 3 purposes of stock management
Stock is available for use when it’s needed
The part finished goods don’t sit around for too long
Finished goods are available for timely delivery for customers
Who are the purchasing department
A team of people who are in charge of sourcing and purchasing the necessary parts, components, materials and services that a business needs for its operations
What 4 things must the purchasing department ensure
Items purchased must be in the correct quantity
Items purchased must arrive on time to the correct location
Items purchased must be of sufficient quality
Payments are made promptly and accurately
What are4 differences between jit and normal stock management.
No large buffer stocks
Reorder level and quantity have fallen
Delivery time has fallen
What are 3 advantages to jit
Improved stock rotation
Freeing of space
Less stock waste age
What are 3 disadvantages of jit
Risky so could run out of stock
More delivers could increase price of stock
Relies on suppliers having the stock
What are the four types of lean production
Total quality management
Jit
Kaizen
Cell production
What is lean production
Avoiding waste by Maine efficient use of a firms resources in it’s operations
What is kaizen
A Japanese concept where individuals are encouraged so suggest improvements continuously In productivity and quality
What is cell production
Each team is responsible for a significant part of a finished product and rather than each person only carrying out only 1 very specific task, team members are skilled at a number of roles. Cells deal with other cells as if they were customers and take responsibility in their area
What are the four stages of continuous improvement
Asses and reassess
Plan and design
Implement
Evaluate
