Operations - Strategies Flashcards
what are performance objectives
goals that relate to particular aspects of the transformation processes - they help inform operations strategies
what are operation strategies
strategies based off the need to achieve performance goals
what is quality as a PO
- quality of design
- quality of conformance
- quality of service
what is speed as a PO
refers to the time it takes for the production and the operations processes to respond to changes in market demand
what is dependability as a PO
refers to how consistent and reliable a businesses products are
What is flexibility as a PO
refers to how quickly operations processes can adjust to changed in the market eg. changes in market demand cause a pressure on capacity
What is customisation as PO
refers to the creation of individualised products to meet the specific needs of customers
What is cost as a PO
as a performance objective refers to the minimisation of expenses so that operations processes are conducted as cheaply as possible
why is new product design and development important
enables a business to grow and attain a competitive advantge
what are the approaches to new product design/ development
- customer preference
- changes and innovation in technology
what are considerations that have to be made when launching a new product
quality
supply chain management,
output capacity
cost
what are considerations that have to be made when launching a new product
- provision of explicit services
- anticipated implicit services
- whether goods are required in the delivery of the service
what are explicit services
TANGIBLE service - the aspect of the service being provided such as the application of time, expertise,
skill and effort.
what are implicit services
INTANGIBLE - psychological wellbeing - the feeling of being looked after
how does new product and service design influence qantas
- Qantas must continuously seek new services and upgrade existing ones to stay competitive and profitable in the market
–> launch of jetstar subsidiary as a result of growth in the asian aviation market
–> project sunrise –> longhaul flight from aus to ny and europe
what is supply chain management
involves integrating and managing the flow of supplies throughout the inputs, transformation processes (throughput and value adding) and outputs to best meet the needs of customers
what is logistics
Logistics - broadly referring to distribution but also includes:
- Transportation
- The use of storage, warehousing and distribution centres
- Materials handling and packaging
what is e commerce
The use of online systems to manage supply, allows suppliers direct access to the businesses level of supplies
B2B
B2C
what is global sourcing
the decision by management to acquire supplies or services without being constrained by location
sourcing = the purchasing on inputs for the transformation process
qantas and supply chain management
- collaborates with over 10000 suppliers with an annual expenditure of approximately $12 billion
- Global sourcing allows qantas to obtain supplies without being restricted to local providers offering cost advantages however, it comes with risks related to fluctuating exchange rates, foreign laws and customs eg. QS hires pilots from NZ, cabin staff in asia,and outsourced engine maintenance activities in malaysia and the us , often at wages lower than those paid in australia
- E commerce transformed supply chain management by replacing manual processes with real time information on quantity, quality, availability, source and price - it also facilitates electronic funds transfer for payments
- Logistics at qs ensures the availability of of physical inputs eg pilots, cabin crew, baggage handling, maintenance and catering in the right quantities at the right locations and times - this guarantees smooth and efficient operations processes, particularly for flights without disruptions
- FUEL hedging
advantages of outsourcing
- Simplification
- Efficiency and cost savings
-Increased process capability - Increased accountability
- Access to skill/ resources lacking within the business
- Provides a capability to to focus on core competencies, thus improving in house performance and several strategic benefits
what is outsourcing
involves the use of external providers to perform business activities
disadvantages of outsourcing
- The cost and uncertainty associated with payback
- Issues of communication and language
- Loss of control of standards and information security
- Loss of corporate memory and and costs associated with IT, organisational change, redesign and management of hierarchies
qantas and outsourcing
- Qantas outsource a significant portion of its IT operations, call centre functions, flight attendant services, maintenance activities and ground handling services
- This approach is adopted for cost effectiveness and efficiency compared to in house tasks
The opposite of outsourcing = vertical integration → Qantas maintains its own catering division for supplying meals and operates its travel agencies like qantas holidays, jetset and tripadeal - Advantages of outsourcing for qantas include: capital saving, labour saving, enhanced dependability, cost savings, access to specialised skills, increased flexibility, management efficiency
- Disadvantages of outsourcing include: dependence on external parties for input supply, loss of control, quality concerns, false economy, cost implications, industrial problems, damage to public image
what is technology (in relation to operation processes)
Technology refers to the application of innovative devices, methods, and machinery in operations processes
what is leading edge technology
The most advanced or innovative at a point in time
what is established technology
Technology that has already been developed and is widely used, and widely accepted eg. computers and various software packages in managing business operations and functions
qantas and technology
leading edge
- a350s for project sunrise
- incorporating fuel analytics with flight pulse app which utlises data to enable pilots to reduce fuel consumption and carbon emissions
- developing a new biofuel derived from a type of mustard seed
- implementing a digital health passport app, allowing customers to prove their vaccine status for border crossings
established
- purchase of boeing dreamliners planes to replace the last of the 747’s and using tried and tested applications like CAD, CAM, EFT and software eg. gantt charts and CPA
what is inventory management
refers to how a business manages its quantity of raw materials, works in progress and finished goods at any point in time.
what is fifo
First in first out = stock bought first is the stock sold first - 1000 phones - first 300 sold for $100 - next 300 sold for $110 - next 300 sold for $120
what is lifo
Last in first out = stock bought last is sold first - 1000 phones - first 300 sold for $120 - next 300 sold for $110 - next 300 sold for $100
what is JIT
Just in time (JIT) - aims to overcome the problem of end of period stock valuation
- Lean production method = businesses will only make enough products to meet demand → emphasis low cost
qantas and inventory management
- maintaining an essential amount is desirable for smooth and efficient operations
- excess quantities incur additional production costs, while holding too little can lead to disruptions and sales disruptions and sales loss
- more significant for manufacturing businesses, unlike qantas which doesn’t store products to meet customer demand like manufacturing companies
- JIT used for spare parts and food supplies
what is quality management
refers to those processes that a business undertakes to ensure consistency, reliability and safety and fitness of a purpose of product or service
what is quality control
- inspections at various points of the production process
- reactive
what is quality assurance
- application of quality standards
- ISO 9001 → “international organisation for standardisation” → involuntary, but businesses may comply with their requirements to enhance their domestic and international competitiveness
- proactive
what is quality improvement
- emphasis on total quality management and continuous improvement
- staff are integral
qantas and QM
QC
- inspection and maintenance of planes after flights
QA
- meeting international standards –> IATA operational safety audit (IOSA) and civil aviation safety authority procedures as benchmark for operational safety management
QI
- Recent initiatives include investments in new aircraft, lounge upgrades, improved baggage tracking, wireless inflight entertainment rollout and enhanced food offerings, all aimed at improving the overall quality of qantas’s service
what is overcoming resistance to change
the need to manage and be responsive to change is a notable influence on operations strategies
differentiate between external change and internal change
External changes - caused by legislation, the economy, societies expectations and new technology
Internal changes - brought on by staff initiative, use of available technology and innovation of good or services
what are the 2 main sources of resistance to change
- financial
- psychological/ emotional
what are financial restrictions to change
- purchasing new equipment
- Redundancy payment
- Retraining employees
- Structural reorganisation of the business including changes to plan and equipment layouts
what are human restrictions to change
Inertia = psychological resistance to change - feeling of uncertainty or fear of the unknown
qantas and overcoming resistance to change
- covid necessitated change –> opened new flight training centres
what are global factors
Global factors refer to international factors that influence a business
what is global sourcing
Global sourcing is a broad reference to sourcing business supplies or services without being constrained by location and it therefore includes all outsourcing
what is economies of scale
Economies of scale refers to cost advantages that can be gained by increasing the size, or scale, of production → This means that businesses can lower their per unit input costs
what is scanning and learning
what is research and development
qantas and global factors
Global sourcing
Global sourcing is the practice of procuring goods and services internationally, extending beyond geopolitical boundaries.
Qantas sources various supplies globally, from stationery to aircraft, resulting in significant cost savings.
Expanding its international supplier base has enabled Qantas to benefit from global efficiencies, including lower-cost skilled labor, more affordable raw mattrials, and economic incentives such as tax breaks and low trade tarifs.
Economies of Scale
Qantas, the largest Australian airline, leverages economies of scale to reduce operational costs.
Qantas serves a diverse array of destinations and offers more services during morning and evening peak hours on key routes compared to its competitors. Both the variety of destinations and the frequency of peak-hour services are vital drivers of business travel, a highly profitable segment of the market dominated by Qantas.
Large airlines like Qantas also secure more favorable agreements with various suppliers, the most significant being aircraft manufacturers like Boeing and Airbus. Qantas leverages cost advantages through diversification, operating various business segments such as full-service carriers, low-cost carriers (Jetstar), and freight services.
This diversification enables the sharing of common costs across segments, exemplified by minimal additional costs for transporting freight in passenger plane cargo holds.
Scanning and Learning
The increased level of globalisation results in heightened competition and the rapid introduction of new technologies, leading to continuous changes in the business environment.
To remain competitive, Qantas must keep pace with global developments, staying well-informed and continuously testing their relevance to current operations.
Qantas management must continually acquire, analyse, and evaluate a growing volume of data and information to enhance or adapt operational processes.
Research and Development (R&D)
Qantas’ Research and Development (R&D) function focuses on creating and implementing new knowledge and ideas to develop and enhance products or services, providing a competitive edge.
Notably, Qantas allocated $50 million to research sustainable fuel from mustard seeds for reduced carbon emissions.
Additionally, the airline conducted ultra-long research flights to gather data on in-flight passenger and crew health for Project Sunrise approval.
