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Business > Operations Strategies booklet > Flashcards

Operations Strategies booklet Flashcards

1
Q

Operational obj

A

targets a business sets in order to produce goods or services in the most effective way

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2
Q

Quality targets

A

Cost targets
Innovation
Efficiency
Environmental targets

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3
Q

Influences on objectives

A

Internal:
Finance
Marketing
People/HR

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4
Q

Scale- production types

A

Job production- each customer individual needs
Batch production- group orders
Flow production- mass- everyday standardised items

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5
Q

Mix will depend on

A

Relative price of resources
Nature of the product
Availability of resources
State of technology

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6
Q

Economies of scale- Internal

A 
About spreading some form of fixed costs across more units 
Internal:
Technical- auto production lines
Purchasing- buying in bulk
Specialisation- specialist managers 
Also financial and managerial
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7
Q

Economies of scale- external

A

About spreading some form of fixed costs across more units
External:
Labour- availability of skill in specific area
Joint ventures- spread cost and risk
Support services- cluster in certain areas

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8
Q

Diseconomies of scale

A

as business grows in size and produces more units of output it experiences rising average cost of production

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9
Q

Inputs in production

A 
Land
Labour
Capital 
Natural resource
Enterprising
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10
Q

Labour intensive- Advantages

A 
High levels of workers in production
Advantages:
Staff flexible to meet demand
Personal touch- customer needs
Tailor made products
Labour can provide feedback
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11
Q

Labour intensive- Disadvantages

A 
High levels of workers in production
Disadvantages:
Expensive in long term 
Inefficient and inconsistent levels of effort
Labour relation problems
Shortage of skilled labour
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12
Q

Capital intensive- Advantages

A 
Uses high levels of capital (machinery) in production
Advantages:
Reduces human error 
Greater speed and uniform effort
Technical economies of scale
No problem with labour shortage
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13
Q

Capital intensive- disadvantages

A 
Uses high levels of capital (machinery) in production
Disadvantages:
Initial high cost and possible training
Lack of flexibility- fall in demand
Machinery lacks initiative
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14
Q

Innovation- Aims

A 
Means bringing a new idea into being within market place or workplace
Aims:
USP
Better quality
Efficient ways of producing
Better ways of doing things
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15
Q

Innovation- process

A 
Means bringing a new idea into being within market place or workplace
Process:
Increasing efficiency
Improve quality of manufacture
Improve quality of service
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16
Q

Innovations- Implications

A 
Means bringing a new idea into being within market place or workplace
Finance- investemtn expensive
HR- Staff consulted about changes
Wokrforce planning issues
Staff need to be trained
Marketing- market research- demand
4p's customer needs and wants
Advertising to launch new product
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17
Q

R&D- aims

A 
Extensive scientific research into the product and its design- prototypes
Aims:
USP
Better quality
Efficient production
18
Q

Spending on R&D Benefits

A

Creates USP
Differentiate- comp advantage
Efficient production process
Premium pricing

19
Q

Spending on R&D drawbacks

A 
Costs
Risk of failure
Timing of release
Risk of being copied
Intellectual property protection
20
Q

Influences on innovation

A 
Cannot raise necessary funds
pressure from investors
Low success may deter investors
Business culture
business strats- risk
21
Q

Benefits of innovation/R&D

A

USP
Firms reputation- quality innovative
Higher levels of efficiency
Intellectual P.P

22
Q

Drawbacks of innovation/R&D

A

Cost- R&D
R&D time consuming
Other firms launch ‘me too’ products
Image- failure

23
Q

Good location benefits

A 
Competitive unit cost
Optimal revenue opportunities 
Acceptable ARR
Sufficient production capacity
Labour force access
Diversity
24
Q

Factors affecting location decision

A 
Cost and availability of land
Cost and availability of labour
Communication links
Transport costs/Proximity to the market
Availability of raw materials
Government location incentives
25
Q

Advantages of multi site locations

A

Closer to customer/markets- monitor trends better
Prestigious location as well as cheaper sites elsewhere
Abroad- reduce costs
Reduce risk of supply disruption
Smaller businesses operating as conglomerate- each element in optimal place
Delegation of authority
Marketing and management economies of scale
Easier to flex capacity

26
Q

Disadvantages of multi site locations

A

Co-ordination and communication problems
Lack of control and direction
Different cultural standards and legal systems in different countries
Increased strategic risk
Cannibalism- too close together
Greater operating costs- transporting materials

27
Q

International location- Quantitative

A

Tax advantage
Exchange rates
Lower overseas cost

28
Q

International location- Qualitative

A

Access to new market
Political Stability
Ethical issues
Image

29
Q

Offshoring

A

Shifting production overseas

30
Q

Reshoring

A

Bringing manufacturing back to the UK

31
Q

Lean Production

A

range of measures used in attempt to reduce waste and cost in production

32
Q

Critical path

A 
'network analysis'
1. Right to left 
EST top quadrant 
Take highest result
2. Right to left 
LFT bottom quadrant
Take lowest result
33
Q

Benefits of critical path

A

Identify what activities involved in project or process
Calculate earliest time when project completed
Identify critical activities- influence speed of whole project
Produce/develop faster than competition
Implement just in time ordering
Use CPA as control to review progress

34
Q

Limitations of Critical path

A

Relies on estimate
JIT- reliability of suppliers
CPA- shows quickest way but not most effective resource use
All projects must be managed properly

35
Q

Just in time

A

Aims to minimise:
Production time
Production costs
Amount of stock held in the factory

36
Q

Advantages of JIT

A

Less cost of holding stock
Less working capital required
Less ruined stock
Lower associated stock costs

37
Q

Disadvantages of JIT

A 
Little room for error
Very reliant on suppliers 
Unexpected orders harder to meet
High initial set up costs
Complex system
38
Q

Cell production

A

Manufacturing an item, organising workers into cells (teams)

39
Q

Cell Production advantages

A 
Improved communication 
Workers become multi skilled- adaptable
Greater motivation
Quality improvements
Increased productivity
Reduced absenteeism + labour turnover
40
Q

Cell Production disadvantages

A

Trust and participation- exploitation
Not worthwhile- small scale
Efficient scheduling of workers
Good recruiting/ training needed

41
Q

Benchmarking

A

Measuring performance vs competition- learnt from best in the world

42
Q

Kaizen

A

Business with continually update and improve their products and marketing

Business (10 decks)

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