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Business Studies > Operations Strategies > Flashcards

Operations Strategies Flashcards

1
Q

What are the operations strategies

A
  • new product or service design and development
  • performance objectives
  • outsourcing
  • supply chain management
  • technology
  • quality management
  • inventory management
  • global factors
  • overcoming resistance to change
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2
Q

What 6 come under performance objectives

A

quality
speed
dependability
flexibility
cost
customisation

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3
Q

what is quality

A

quality is the consistency and dependability of output. in ensuring quality, wastage and remedial costs can be reduced.

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4
Q

Quality’s role in evaluating operations

A

shows the effectiveness of the production process- whether each product meets the required demands

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5
Q

what is speed

A

speed is the turnaround time between customers ordering a product or service and the point at which they receive it

  • when an organisation delievers the goods or services on time, the more likely a customer is to be satisfied with their experience
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6
Q

speed’s role in evaluating operations

A
  • determines the efficiency of operations
  • can allow managers to identify areas of improvement
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7
Q

what is dependability

A

Dependability is being on time ( consistency ), determines repeat business

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8
Q

what is dependability’s role in operations

A

consistency shows effectiveness of current processes - whether they work or not

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9
Q

what is flexibility

A

adapting to changing circumstances
- external ( focus on customer satisfaction )
- internal ( focus on production speed )

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10
Q

what is flexibilitys role in operations

A
  • shows the fiverse skills throughout the operations process - ability of employees to adapt to change
  • the more flexible - the shorter lead time
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11
Q

what is customisation

A

creating individualised products to meet customer needs
- ability of a business to cater for diverse tastes and preferences

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12
Q

what is customisations role in operations

A

shows the flexibility of processes and their ability to change to meet demand

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13
Q

what is cost

A

reducing expenses to create a bigger profit

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14
Q

how does cost link to operations

A

initatives to minimise costs are central to strategic role of operations management
- efficiency of processes = profitability

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14
Q

What 6 come under performance objectives

A

quality
speed
dependability
flexibility
cost
customisation

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15
Q

Strategy 2.
What is new product or service design and development

A

The design, development, launch and sale of new products enables a business to grow and attain a competitive advantage

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16
Q

What are the two approaches

A
  1. consumer approach ( preferences are identified trough market research and determines which products are designed and developed )
  2. changes and innovations in technology that enable new, appealing products to be made
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17
Q

What 6 come under performance objectives

A

quality
speed
dependability
flexibility
cost
customisation

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18
Q

what does explicit mean in terms of a service

A

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

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19
Q

what does implicit mean in terms of a service

A

based on a feeling and is therefore intangible.

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20
Q

Strategy 3.
What is SUPPLY CHAIN MANAGEMENT

A

Supply chain management involves integrating and managing the flow of supplies throughout the inputs, transformation process and outputs in order to best meet the needs of customers

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21
Q

what 3 aspects are included in supply chain management

A
  • logistics
  • e-commerce
  • global sourcing
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22
Q

what is logistics

A

a term referring to distribution but includes transportation, the use of storage, warehousing and distribution centres, materials handling and packaging

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23
Q

characteristics of logistics

A
  • movement of goods and information through the supply chain
  • distribution / transportation
  • storage - finding a secure place to hold stock
  • warehousing
  • handling and packaging
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24
Q

define storage

A

involves finding a secure place to hold stock until it is required
- can be long term or short term

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25
Q

define warehousing

A

involves the use of facility for the storage, protection and distribution of stock
- hold inventories ( cost )

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26
Q

define e-commerce

A

buying and selling of goods and services via the internet

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27
Q

3 types of e-commerce

A

E-procurement - online systems to manage supply, allows suppliers direct access to the business
B2B - direct access from one business ( supplier ) to another ( buyer )
B2C - transaction with customers

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28
Q

ADVANTAGES of e-commerce

A
  • allows businesses to manage supply
  • B2B - direct access from one business to another
  • purchase items at a lower cost from other nations
  • target a wider audience
29
Q

define global sourcing

A

obtaining inputs from around the world

30
Q

ADVANTAGES of global sourcing

A
  • cost and expertise advantages, access to new technoligies and resources
  • cheaper ( higher quality inputs )
  • differentiated products
31
Q

Strategy 4
Define Outsourcing

A

Outsourcing is the use of external providers to perform certain business activities

32
Q

ADVANTAGES of outsourcing

A
  • cost saving and efficient
  • specialised and expert staff
  • productivity increased
  • time and money is not wasted on training / development
  • improve quality of product
33
Q

DISADVANTAGES of outsourcing

A
  • lack of loyaty to the business
  • potential lower quality
  • employee dissatisfaction
  • lack of control over quality
  • communication and language barriers
34
Q

strategy 5
Technology

A
  1. leading edge technology
  2. established technology
35
Q

what is leading edge technology

A

Helps businesses create products quicker and achieve higher standards, with less waste and may also help them operate more effectively
- most advanced or innovative at any point in time

36
Q

ADVANTAGES of leading edge technology

A
  • provides a competitive advantage
  • point of difference
37
Q

DISADVNTAGES of leading edge technology

A
  • is unreliable
  • more expensive
  • requires retraining for efficient use
38
Q

what is established technology

A

It has already been developed, widely used and widely accepted.
- eg. computers and software that manage the operations process
- establish basic standards for productivity

39
Q

ADVANTAGES of established technology

A
  • cheaper
  • reliable / proven
40
Q

DISADVANTAGE of established technology

A
  • lacks a competitive advantage
41
Q

Strategy 6
Inventory Management

A

It is the amount of raw materials, work-in progress and finished goods that a business has on hand at any particular point in time

42
Q

ADVANTAGES of inventory management

A
  • consumer demand can be met straight away
  • reduced lead times between order and delivery
  • make immediate revenue
43
Q

DISADVANTAGES of inventory management

A
  • costs, storage charges, spoilage, insurance, theft, handling expenses
  • invested capital, labour + energy cannot be used elsewhere as it has to be used to create stock
44
Q

In terms of inventory management what are the 3 types of pricing

A

LIFO
FIFO
JIT

45
Q

what is LIFO

A

last in - fist out
Stock purchased most recently is sold first

eg. used for goods with no use-by-dates eg. canned goods

46
Q

what is FIFO

A

first in - first out
oldest stock sold first

eg. ideal for perishables

47
Q

what is JIT

A

just in time
Holding as minimal stock as possible and only bring in stock from suppliers as required

  • increases liquidity of working capital
  • reduced costs of storing + securing stock
48
Q

Strategy 7
Quality Management

A
  • control
  • assurance
  • improvement
49
Q

what is quality control

A

reduces problems and defects through inspection at various points during production

  • pre-determined quality targets are set for all products to meet
50
Q

What is inspection and quality control

A

It ensures all outputs meet required standards, many businesses carry out inspections for all or parts of the total volume of production

51
Q

what is quality assurance

A

involves use of a system to ensure set standards are achieved in production

52
Q

what does quality insurance involve

A
  • use of a system to ensure all set standards are achieved
  • proactive application
  • takes a series of measurements and assesses them against predetermined quality standards
  • FIT FOR PURPOSE - ‘how well a product does what it is designed to do’
53
Q

what is within improvement

A

total quality improvement and continuous improvement

54
Q

what is continuous improvement

A

ongoing commitment to improve business over time
- process more efficient and effective
- inclusion of staff into improvement process

55
Q

what is total quality management

A

‘holistic’ approach where the quality becomes both a commitment and the responsibility of every employee of the business

56
Q

Strategy 8
Overcoming resistance to change

A

FINANCIAL COSTS
- purchasing new equipment
- redundancy payments
- retraining
- reorganising plan layout
- inertia

57
Q

Financial Costs

A

Main financial costs associated with change include
- purchasing new equipment
- reduancy payments
- retraining
- reorganising plant layout

58
Q
  1. purchasing new equipment
A

Can be expensive however cost can be recovered through use and depreciation

ACHIEVE:
- improved processing speed
- shorter lead times
- more consistency in production
- higher quality
- reduced waste

59
Q
  1. Redundancy payments
A

Money given to employees when they are forced out of work due to their job skills no longer being relevant

PAYMENT DEPENDS ON:
- duration working
- level of pay
- amount of unused leave

60
Q
  1. Retraining
A

May occur when job roles change requiring employees to acquire different work skills

  • purchase of new technology may involve new training
61
Q
  1. reorganising plant layout
A

requires extensive reorganisation of the layout within the facility

  • high costs can occur
62
Q
  1. Inertia
A

Internal stakeholders such as owners, managers and employees become too comfortable in a stable environment, and therefore are resistant to change

STRATEGIES:
- retraining programs
- work teams
- flatter management structure

63
Q
  1. Global factors
A
  1. global sourcing
  2. economies of scale
  3. scanning and learning
  4. research and development
64
Q

what is global sourcing

A

Sourcing goods and services from across national boundries

65
Q

benefits of global sourcing

A
  • cheap skilled labour
  • cheap materials
  • tax breaks
  • cost advantages
  • access to technologies
66
Q

complexities of global sourcing

A

financial - risk associated with fluctuations of exchange rates

contractual - language + cultural barriers, regulations + law differences

67
Q

economies of scale

A

refers to cost advantages that can gained by producing on a larger scale
- cost leadership is achieved

68
Q

benefits of economies of scale

A
  • scale of production increases – unit per cost falls ( proftability rises )
  • product life cycles are extended - greater value on production
69
Q

scanning and learning

A

A business benefits from scanning the global environment and learning from the best practises around the world

eg. can learn from
- management journels
- industry and business conferences
- forums

70
Q

research and development

A

helps a business create leading edge technologies, and to create innovative products and solutions

  • finding out what consumers want and assisting to create products that meet their needs

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