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HSC: Business > Operations Notes > Flashcards

Operations Notes Flashcards

1
Q

Define operations

A

Operations is the business processes that involve transformation or, more generally, ‘production’

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2
Q

Define transformation

A

Transformation is the conversion of inputs into outputs

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3
Q

Define value adding

A

Value Adding is the creation of extra or added value as inputs are transformed into outputs

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4
Q

Given that inputs are the resources used in the transformation (production) process, provide examples of inputs

A

Inputs can be goods or services tangible or intangible

Broad groups of inputs:
Labour;
Energy;
Raw materials;
Machinery and technology

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5
Q

Define Lean Production

A

Lean Production is the aim to eliminate waste at every stage of production, involving analysing each stage of the production process, detecting where inefficiencies are, and correcting them

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6
Q

Recall the informal term for lean production

A

The informal term for lean production is minimising waste

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7
Q

Identify the features of lean production

A

Features:
- Reflect fair value for any labour used in processes
- Operate at low cost so as to maximise affordability
- Operations processes adjust to shifting needs

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8
Q

Define strategic

A

Strategic refers to long-term, broad aims affecting all key business areas; that is, the strategic role of each key business function involves the managers of each function contributing to the strategic direction or strategic plan of the business

3 - 5 years

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9
Q

Define profit centres

A

Profit Centres are those aspects of a business that directly derive revenue and profits

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10
Q

Define cost centres

A

Cost Centres are particular areas, departments or sections of a business to which costs can be directly attributed

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11
Q

Define cost leadership

A

Cost Leadership involves aiming to have the lowest costs or to be the most price-competitive in the market

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12
Q

Define economies of scale

A

Economies of scale are cost advantages that can be created as a result of an increase in scale of business operations

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13
Q

Identify the relationship between cost and quality

A

As the cost spent increases or decreases, the quality also tends to
Cutting costs compromises quality but high quality products are costly

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14
Q

Define good/service differentiation

A

Good/ Service Differentiation is when products (goods or services) are distinguished in some way from those of competitors

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15
Q

Recall the characteristics that distinguishes goods and services

A

The characteristics are:
- Tangibility and Perishability
- Customisation
- Ownership
- Time between production and consumption
- Determination of Value

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16
Q

Define standardisation

A

Standardisation refers to the making of products that are homogeneous or identical

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17
Q

Recall how goods are differentiated

A

Variation in:
- Features
- Product Quality
- Augmented Features

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18
Q

Recall how services are differentiated

A

Variation in:
- Time spent on a service
- Level of expertise
- Providing self-service options
- Flexibility
- No ‘fuss’
- Qualifications and experience
- Quality of materials/ technology

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19
Q

Define globalisation

A

Globalisation refers to the removal of barriers of trade between nations. Globalisation is characterised by an increasing integration between national economies and a high degree of transfer of capital (facilities and/or machinery), labour, intellectual capital and ideas, financial resources and technology

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20
Q

Define fixed costs

A

Fixed Costs are ones that are not dependent on the level of operating activity in a business. Fixed costs do not change when the level of activity changes — they must be paid regardless of what happens in the business

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21
Q

Define variable costs

A

Variable Costs are ones that vary in direct relationship to the levels of operating activity or production in a business. Such costs include labour costs and costs of energy

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22
Q

Define instant asset write-off

A

Instant Asset Write-off is a policy that allows businesses to claim a tax deduction for the cost of an asset, such as technological equipment

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23
Q

Define compliance costs

A

Compliance Costs are the expenses associated with meeting the requirements of legal regulations, i.e. abiding by all laws

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24
Q

Define environmental sustainability

A

Environmental Sustainability (ecological sustainability) shapes business operations around practices that consume resources today without compromising access to those resources for future generations

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25
Q

Define precaution principle

A

Precautionary Principle requires that, where environmental impacts are uncertain, a business undertakes actions that are most likely to cause the least environmental impact

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26
Q

Define triple bottom line

A

Triple Bottom Line refers to the financial profitability, social impact and the environmental impact of a business

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27
Q

Define sustainability report

A

A sustainability report provides a comprehensive account of a business’ commitment to areas of ethical decision making, beyond legal requirements

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28
Q

Define fiduciary

A

Fiduciary is a person in a position of financial trust with respect to others’ money

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29
Q

Recall the types of outsourcing

A

The type of outsourcing includes:
- Onshore outsourcing
- Offshore outsourcing

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30
Q

Define capital-labour substitution

A

Capital-labour substitution is when machinery and technology displace people by doing the work they do, thus making labour redundant

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31
Q

Define intermediate goods

A

Intermediate Goods are manufactured and used in further manufacturing or processing

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32
Q

Define key performance indicators

A

Key Performance Indicators is a quantifiable measure used to evaluate the success of an organisation, employee, etc. in meeting objectives for performance

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33
Q

Define customer relationship management

A

Customer Relationship Management (CRM) are the systems that businesses use to maintain customer contact

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34
Q

Define lead time

A

Lead Time is the time it takes for an order to be filled from the moment it is made

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35
Q

Define volume flexibility

A

Volume Flexibility refers to how quickly the transformation process can adjust to increases or decreases in demand

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36
Q

Define mix flexibility

A

Mix Flexibility is the costs a business incurs when implementing changes within its product range

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37
Q

Define Gantt Charts

A

Gantt Chart is a type of bar chart that shows both the scheduled and completed work over a period of time. It is often used in planning and tracking a project

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38
Q

Define critical path analysis

A

Critical Path Analysis (CPA) is a scheduling method or technique that shows what tasks need to be done, how long they take and what order is necessary to complete those tasks

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39
Q

Define monitoring

A

Monitoring is the process of measuring actual performance against planned performance

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40
Q

Define control

A

Control occurs when KPIs are assessed against predetermined targets and corrective action is taken if required

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41
Q

Recall the statistic over customer dissatisfaction

A

1 dissatisfied customer tells 11 others, who, in turn, tell another 5 people

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42
Q

Define warranty

A

Warranty is a promise made by a business that they will correct any defect in the goods that they produce or in the services that they deliver

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43
Q

Define performance objectives

A

Performance Objectives are goals related to particular aspects of the transformation process

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44
Q

Define quality of design

A

Quality of Design is the effectiveness of the business in designing a product that meets the preferences of consumers

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45
Q

Define quality of conformance

A

Quality of Conformance is the focus on how well the product meets the standard of a prescribed design with certain specifications

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46
Q

Define mass customisation

A

Mass Customisation is a process that allows a standard, mass-produced item to be personally modified to specific customer requirements

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47
Q

Outline the 2 approaches towards product development and design

A

There are 2 approaches towards the design and development of new products:
1. The preferences and desires of consumers, as identified by market research, determine which product are designed and developed
2. Changes and innovations in technology that enable new, appealing products to be made, because they use advanced technologies, which give products greater functionality

48
Q

Define supply chain management

A

Supply Chain Management (SCM) involves integrating and managing the flow of supplies throughout the inputs, transformation processes (throughput and value adding) and outputs in order to best meet the needs of customers

49
Q

Define capacity management

A

Capacity management – any new product will have an impact on capacity and may increase the use of range of present resources, or require an investment in new capital equipment

50
Q

Define product utility

A

Product Utility is the usefulness and value that a product has from the consumer’s point of view

51
Q

Define explicit service

A

Explicit Service is the tangible aspect of the service being provided, such as the application of time, expertise, skill and effort

52
Q

Define implicit service

A

Implicit Service is based on a feeling and is therefore intangible. The implicit aspects of a service are the psychological wellbeing — the feeling of being looked after — that comes with the provision of the service

53
Q

Define implicit satisfaction

A

Implicit Satisfaction can be provided through the embedding of level of skill, time, and expertise so the consumer knows they have been specifically catered for

54
Q

Define top-down approach (supply chain)

A

Top-down Approach is an approach to supply chain management that traces the processes of the supply chain from the final product to the inputs

55
Q

Define bottom-up approach (supply chain)

A

Bottom-up Approach is an approach to supply chain management that traces the processes of the supply chain from the inputs to the final product

56
Q

Define logistics

A

Logistics broadly refers to distribution but encompasses transportation (including transportation modes), the use of storage, warehousing and distribution centres, materials handling and packaging

57
Q

Recall how warehouses and distribution centres differ

A

Distribution centres differ in that they were not designed to store items for the long-term

58
Q

Define e-commerce

A

E-commerce is the buying and selling of goods and services via the internet

59
Q

Define e-procurement

A

E-procurement is the use of online systems to manage supply, which allows suppliers direct access to the business’s level of supplies

60
Q

Define B2B

A

B2B is direct access from one business (the supplier) to another (the buyer), allowing the supplier to assess the needs of the buyer and meet them in a timely manner

61
Q

Define B2C

A

B2C is the selling of goods and services to consumers over the internet, with payment usually by credit card

62
Q

Define global sourcing

A

Global Sourcing refers to businesses purchasing supplies or services without being constrained by location. In the supply chain management activity, global sourcing means buying or sourcing from wherever the suppliers are that best meet the sourcing requirements.

63
Q

Define Business Process Outsourcing (BPO)

A

Business Process Outsourcing is outsourcing that involves the use of external providers to perform business activities

64
Q

Recall the elements of the business that can be outsourced

A

Business Process Outsourcing (BPO)
Finance and Accounting outsourcing (FAO)
Knowledge Process outsourcing (KPO)
Legal Process outsourcing (LPO)

65
Q

Outline the advantages and disadvantages of globalisation

A

Advantages
- Larger market
- Outsourcing can be cheaper
- Provides greater access to materials

Disadvantages
- Creates disparity of wealth between nations
- Minimally benefits developed countries
- Exploition of physical & intellectual resources

66
Q

Define cost-based competition

A

Cost-based Competition is derived from determining the breakeven point (the level at which the firm’s total revenue is exactly equal to its total costs) and applying strategies to create cost advantages over competitors

67
Q

Recall statistics in relation to environmental sustainability

A
  • 80% of consumers indicate sustainability is important to them
  • 71% of employees and employment seekers say that environmentally sustainable companies are more attractive employers
  • Investment in environmental, social and governance ESG (environmental, social, and governance) assets may reach $53 trillion by 2025, representing over a third of global assets
68
Q

Recall the types of quality management

A

The 3 types of quality management are
- Quality control
- Quality assurance
- Quality Improvement

69
Q

Recall how the operations can be improved

A

The operations of a business can be improved through:
- Quality
- Cost
- Time
- Process flows
- Efficiency

70
Q

Recall the statistics related to customer service

A

Businesses that provide superior customer service:
- Charge an average of 10% more for the same products
- Grow twice as fast as their competitors

71
Q

Define leading edge technology

A

Leading-edge Technology is the technology that is the most advanced or innovative at any point in time

72
Q

Define established technology

A

Established Technology is technology that has been developed and is widely used and simply accepted without question

73
Q

Identify the advantages of leading edge technology

A

Leading edge technology:
- Create more products quickly and to higher standards
- Reduce waste
- Operate more effectively

74
Q

Recall the types of inventory valuation techniques

A

The types of inventory evaluation techniques are:
- LIFO
- FIFO

75
Q

Define LIFO

A

LIFO (last-in-first-out) is a method of pricing inventory that assumes that the last goods purchased are also the first goods sold and therefore the cost of each unit sold is the last cost recorded

76
Q

Define FIFO

A

FIFO (first-in-first-out) is a method of pricing inventory that assumes that the first goods purchased are also the first goods sold and therefore the cost of each unit sold is the first cost recorded

77
Q

Assuming for inflation and other rising costs, describe the effect of the inventory valuation techniques on the books

A

LIFO: (assuming for inflation and other rising costs)
Overstate stock cost and understate gross profit
Undervalue stocks on hand at the end of the period

FIFO: (assuming for inflation and other rising costs)
Understate stock costs and overstate profits
Overvalue stocks on hand at the end of the period

78
Q

Define JIT

A

Just-in-time (JIT) is an inventory management approach which ensures that the exact amount of material inputs will arrive only as they are needed in the operation process

79
Q

Define JIC

A

JIC (Just-in-Case) is a stock control method that involves producing or purchasing stock with excess, or buffer stock in place. This means that there is always stock available for the business if required

80
Q

Define quality management

A

Quality Management are those processes that a business undertakes to ensure consistency, reliability, safety and fitness of purpose of product

81
Q

Define quality control

A

Quality Control (QC) involves the use of inspections at various points in the production process to check for problems and defects

82
Q

Recall whether quality control is reactive or proactive

A

Quality control is reactive

83
Q

Define attribute inspection

A

Attribute Inspection is when the goods or services are inspected and can be designated as ‘okay’ or ‘defective’

84
Q

Define quality improvement

A

Quality Improvement (QI) emphasises continuous improvement and total quality management

85
Q

Define continuous improvement

A

Continuous Improvement is an ongoing commitment to improving a business’s goods or services

86
Q

Define total quality management

A

Total Quality Mangement focuses on managing the business to deliver quality to customers in all aspects

87
Q

Define telecommute

A

Telecommute is to ‘commute’, or travel to work, electronically. This means that home or another location becomes the worksite and work is delivered via email or the internet

88
Q

Define robotics

A

Robotics is used in engineering and specialised areas of research, as well as on assembly lines where a programmable machine capable of doing several different tasks is required

89
Q

Recall the benefits of robotics

A

Benefits of Robots:
- Efficent
- Minimise waste
- Degree of precision and accuracy unattainable by human labour

90
Q

Define Computer-Aided Design

A

Computer-Aided Design (CAD) is a computerised design tool that allows businesses to create product possibilities from a series of input parameters

91
Q

Define Computer-Aided Manufacturing

A

Computer-Aided Manufacturing (CAM) is software that controls manufacturing processes

92
Q

Define task design

A

Task Design involves classifying job activities in ways that make it easy for an employee to successfully perform and complete the task

93
Q

Define skills audit

A

Skills Audit is a formal process used to determine the present level of skilling and any skill shortfalls that need to be made up either through recruitment or training

94
Q

Define process layout

A

Process Layout is the arrangement of machines so that the machines and equipment are grouped together by the function (or process) they perform

95
Q

Define process production

A

Process Production deals with high-variety, low-volume production; a feature of this approach is the creation of work cells or work teams

96
Q

Define product production

A

Product Production (mass production) is production that is characterised by the manufacturing of a high volume of constant quality goods

97
Q

Define product layout

A

Product Layout is a layout in which the equipment arrangement relates to the sequence of tasks performed in manufacturing a product; e.g. assembly line

98
Q

Define project production

A

Project Production deals with layout requirements for largescale, bulky activities such as the construction of bridges, ships, aircraft or buildings

99
Q

Define fixed position layout

A

Fixed Position Layout is an operational arrangement in which employees and equipment come to the product

100
Q

Define transformed resource

A

Transformed Resources are ones that are changed or converted in the operations process; they are transformed by the operations processes

101
Q

Define transforming resource

A

Transforming Resources are ones that carry out the transformation process and enables the change and value adding to occur

102
Q

Define Cross Branding

A

Cross Branding is when products are differentiated, but the differentiation is not from the product itself but rather from an external factor that the business has brought into the mix

103
Q

Recall what cross branding is also known as

A

Strategic alliance

104
Q

Define specialisation

A

Specialisation is a method of production where a business focuses on the production of a limited scope of products or services to gain greater degrees of productive efficiency within an overall system

105
Q

Define Six Sigma

A

Six Sigma is a quality management approach that seeks to identify and remove the causes of problems in the operations processes, achieving virtually defect-free production

106
Q

Recall features of environmental sustainability

A

Aspects of Environmental Sustainability:
- Sustainable use of renewable resources
- A reduction in the use of non-renewable assets
- Application of the precautionary principle

107
Q

Recall factors for Variety

A

Factors to account for in regard to variety:
- Specialised machinery
- Differently trained employees
- Altered contracts with suppliers

108
Q

Define volume

A

Volume is how much of a product is made

109
Q

Recall what visibility encompasses

A

Visibility encompasses customer feedback

110
Q

Recall the benefits of Gantt charts

A

Benefits of Gantt charts:
- Forces the planning of the steps needed to complete a task and to specify the time required for each task
- Can easily monitor progress against the planned activities

111
Q

Differ between critical tasks and non-critical tasks

A

Critical tasks are on the critical path, non-critical tasks are not

112
Q

Recall the benefits of critical path analysis

A

Benefits of Critical Path Analysis
- Identifies what needs to be done and duration of the task
- Provides a direction and organisation
- Better coordination of the operations
- Visually display bottlenecks

113
Q

Recall all aspects of quality as a performance objective

A
  • Quality of Design
  • Quality of Conformance
  • Quality of Service
114
Q

Recall the advantages and disadvantages of global sourcing

A

Advantages:
- Cost
- Expertise
- Access to new technology and resources

Disadvantages:
- Possible relocation of aspects of the operations process
- Increased cost of logistics, storage and distribution
- Managing different regulatory conditions between nations
- Complexity of overall operations when sourcing from diverse locations

115
Q

Recall factors that impact the choice of supplier

A

Factors:
- Consumer demand
- Quality of inputs required
- Flexibility and timeliness of supply
- Cost of supply

116
Q

Recall how a business can reduce costs

A
  • Economies of Scale
  • Bulk buy inputs
  • Eliminate waste
  • Standardise products
  • High volume output
  • Automated production systems

HSC: Business (12 decks)

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