OPERATIONS: Strategies Flashcards

1
Q

What are the forms of outsourcing?

A

Captive or in house (do-it-yourself).
Non-captive (third parties).
Onshore vs offshore.

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2
Q

What are the advantages of outsourcing?

A

Simplification - reducing the number of activities performed within the business.
Efficiency and cost savings - access to cheaper labour.
Access to skills/resources lacking within the business.
Improvements to in-house performance.

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3
Q

What is the difference between leading edge and established technology?

A

Leading edge - most advanced or innovative at a point in time.
Established - technology that has been developed and is widely used/accepted like barcoding + POS.

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4
Q

Performance objectives: quality.

A

Quality of design.
Quality of conformance - how well the product meets the standard of certain specifications.
Quality of service.

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5
Q

Performance objectives: speed.

A

The time it takes for the production processes to respond to changes in demand.
Objectives include: reduced waiting time, shorter lead times, faster processing times.

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6
Q

Performance objectives: dependability.

A

How consistent and reliable a business’s products are - can be measured through the number of warranty claims.

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7
Q

Performance objectives: flexibility.

A

How quickly operations processes can adjust to changes in the market.

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8
Q

Service design and development.

A

Explicit: the application of time, expertise, skill and effort.
Implicit: the feeling of being looked after.

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9
Q

What is logistics?

A

Managing the movement + storage of the materials involved in the production process.

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10
Q

What is included in logistics?

A

Distribution.
Packaging.
Warehousing, Storage & Distribution Centres.

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11
Q

E-commerce: B2B.

A

(Business to business) allows business to source directly from other businesses - common in manufacturing.

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12
Q

What factors must business consider for sourcing globally?

A

Consumer demand.
Quality of inputs desired.
Flexibility.
Cost of supplier.

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13
Q

What are the challenges of global sourcing?

A

Increased cost of logistics
Managing different regulatory conditions between nations.

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14
Q

What are the advantages of holding stock?

A

Consumer demand can be met when stock is available - prevent them from buying from a competitor.
Older stock can be sold at reduced prices - encourage cash flow.

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15
Q

What are the disadvantages of holding stock?

A

Costs including storage charges, insurance, handling expenses etc.

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16
Q

LIFO.

A

The most recent stock is sold first.
Used for products that can be stored for longer periods of time such as clothing.

17
Q

What are the impacts of using LIFO inventory system?

A

Profit likely to be lower - minimise tax burden.

18
Q

FIFO.

A

First items to come are the first ones sold.
Used for perishable goods such food.

19
Q

What are the impacts of using FIFO inventory system?

A

Profit is likely to be higher increasing tax burden.

20
Q

JIT.

A

Aims to hold as little stock as possible + order new supplies as they are needed.

21
Q

What are the impacts of using JIT system?

A

Saves money as there are no expensive holding and insurance costs.

22
Q

What is quality management?

A

The processes to ensure consistency, reliability, safety and fitness of purpose of product.

23
Q

What is quality control?

A

Checking transformed + transforming resources at various stages of the production process.
Pre-determined quality targets would be set.

24
Q

What is quality assurance?

A

Establishing procedures + standards that will limit the product defects from occurring - a proactive approach.
Business emphasises quality in the design.

25
Quality assurance: ISO.
International Organization for Standardization - are voluntary but many businesses comply with their requirements to enhance their competitiveness.
26
What is quality improvement?
Focus on continuous improvement - over time processes will be made more efficient and effective.
27
Overcoming resistance to change: inertia.
A psychological resistance to change - feeling of uncertainty/fear of the unknown.
28
What are some financial resistances to change in business?
Purchasing new equipment. Retraining. Reorganising plant layout.
29
What is global sourcing?
Business taking advantage of global markets to gain access to labour, capital and inputs from around the world.
30
What are economies of scale?
Where production costs are reduced by increasing the size of the operations. The average cost per unit will fall by: using facilities at full capacity, ensuring staff are continually productive, getting discounts for large orders of materials.
31
What is scanning and learning?
Scanning the global environment + learning from the best practice of businesses around the globe. 'Kaizen' emphasises continuous improvement in all areas of a business, from the way the CEO downwards.
32
What are the advantages of R&D?
Extend product lifecycle. Open new markets. Give the business a reputation of innovation.
33
What are the disadvantages of R&D?
Can be costly. Many projects may not be able to market.