operations managment

Question 1

How can a business raise productivity levels

Answer 1

Training staff – staff will be more flexible & highly skilled. This may have positive motivational effects. But it is expensive & time-consuming.
Improve motivation – Herzberg, Maslow, Mayo
Purchase more advanced equipment – but costly & may cause uncertainty among staff. Training required.
More efficient management

Question 2

Raising productivity does not guarantee success

Answer 2

Unpopular products – think of a product that you would never buy…
Workers may look for higher pay - reducing overall profits even if productivity increases.
Workers & Unions often fearful of demands to raise productivity – defending existing jobs.

Question 3

Efficiency versus Effectiveness

Answer 3

Productivity measures efficiency.

Efficiency means producing output at the highest ratio of output to input.

Question 4

Effectiveness

Answer 4

This means meeting the objectives of the enterprise by using inputs productively to meet customers’ needs.

Being effective involves satisfying consumer needs.

Question 5

Operations Planning

Answer 5

This involves preparing input resources to supply products to meet expected demand.
Operations decisions must be taken with the WHOLE business in mind.
Increasing production will require:
Staff (HRM)
Marketing of additional output (Marketing)
Capital – money to pay for the raw materials etc. (Finance)
Operations decisions must be coordinated & integrated with the rest of the business!

Question 6

Operations & Marketing

Answer 6

Operations is largely concerned with OUTPUT.

But there is no point in supplying goods if there is no demand for them.

Operations managers use SALES FORECASTS to try & match output to demand.

This reduces waste and keeps an appropriate number of employees busy.

Question 7

Operations & technology

Answer 7

Operational decisions will also depend on the resources (Location,Nature of production method, Automation) & technology available to the business.

Operational Flexibility – Ability of a business to vary both the level of production and the range of products following a change in demand.

Flexibility can be achieved with
Flexible production systems - Flexible and adaptable employees
- Appropriate stock control systems
process innovation

Question 8

Process innovation

Answer 8

This is the use of a new or much improved production method or service delivery method.

Examples include:
Robots in manufacturing
Ford’s use of the production line to manufacture cars.
Use of 3D printers & equipment
Using the internet to track parcels in real time around the world

Question 9

Flexibility

Answer 9

It is not easy to predict future demand.

If actual demand differs from forecast, OPERATIONAL FLEXIBILITY is required.

This is the ability of a business to vary both the level of production and the range of products following changes in customer demand.

Question 10

How can a business achieve flexibility?

Answer 10

Increase capacity – extra buildings, more equipment.

Hold a lot of stock – storage costs?

Have a flexible workforce – capable of adapting to demand.

Have flexible production-equipment.