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Business > Production > Flashcards

Production Flashcards

1
Q

Define Batch Production

A

A certain amount of a product is made and then production changes to make another.

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2
Q

Advantages of Batch Production

A
  • produce multiple types of a product
  • can use trends
  • less likely to have excess supply
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3
Q

Disadvantages of Batch Production

A
  • lots of downtime

- batch size is capacity allocated

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4
Q

Define Mass Production

A

A continuous flow of producing.

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5
Q

Advantages of Mass Production

A
  • constantly producing products

- benefit from EOS

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6
Q

Disadvantages of Mass Production

A
  • can’t change the product
  • employees become demotivated due to boredom
  • high set up costs
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7
Q

Define Job Production

A

Products made to fit customer requests/wants.

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8
Q

Advantages of Job Production

A
  • high pricing so high potential profits
  • repeat custom
  • USP
  • less labour
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9
Q

Disadvantages of Job Production

A
  • highly skilled workers
  • so potentially higher costs
  • less custom due to high prices
  • cash flow could be a problem (need deposits)
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10
Q

Define Process Production

A

Involves a series of processes which raw materials go through, the end result being a large quantity of finished product.

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11
Q

Advantages of Process Production

A
  • automated production so reduces unit cost
  • large quantities produced
  • consistent quality
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12
Q

Disadvantages of Process Production

A
  • heavy investment
  • difficult if production is stopped
  • can’t make different versions of the product
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13
Q

Factors Affecting Choice Of Production

A
  • nature of the product
  • seasonality
  • scale of production
  • sources of finance available
  • lifetime of product
  • size of workforce
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14
Q

Define Cell Production

A

Where workers are organised into multi-skilled teams and each team is responsible for a particular part of the production process.

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15
Q

Advantages of Cell Production

A
  • lead to increased efficiency as workers are knowledgeable and skilled
  • increased motivation as employees are using their skills
  • cause workers to become multi skilled
  • improves communication
  • quality improves due to employees working together
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16
Q

Disadvantages of Cell Production

A
  • cost implication due to training of employees
  • productivity must be high for it to work
  • only work if Working culture is appropriate (e.g. proactive employees)
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17
Q

Define Division of Labour

A

Allocation of labour to specific tasks.

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18
Q

Define Specialisation

A

Where workers become skilled within a specific area.

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19
Q

Define Critical Path Analysis

A

Process that allows overall time of project to be calculated.

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20
Q

Advantages of CPA

A
  • helps reduce risk of complex projects
  • encourages careful assessment
  • decision AND planning tool
  • ordering can be made more efficient
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21
Q

Disadvantages of CPA

A
  • based on estimation and assumptions
  • does not guarantee success of the project
  • often complex when there are lots of tasks
  • diagrams alone don’t ensure the efficient working of the operation
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22
Q

How do you calculate Earliest Strat Time (EST)

A

EST = total time taken for previous activity

e.g. task 1 takes 2hrs, task 2 takes 4hrs task 3 can start when?

answer = 6hrs in

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23
Q

How do you calculate Latest Finish Time (LFT)?

A

LFT = subtract task’s durations n from previous tasks LFT

e.g. task 8 LFT is 24hrs and task 7 takes 4hrs, what is task 7’s LFT?

answer = 20hrs

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24
Q

How do you calculate Total Float?

A

TOTAL FLOAT = LFT - EST

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25
Q

How do you calculate FREE FLOAT?

A

EST (next activity) - duration - EST

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26
Q

How do you calculate PERT ANALYSIS?

A

(Optimistic time + 4 x likely time + pessimistic time)/6

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27
Q

Define Gantt Chart

A

A graphical representation of the order and duration of tasks.

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28
Q

Advantages of Gantt Charts

A
  • visual representation
  • easy to monitor
  • see what is happening
  • shows time and resource allocation
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29
Q

Disadvantages of Gantt Charts

A
  • doesn’t show critical activities
  • cannot see EST or LFT
  • can not calculate floats
  • doesn’t allow for external factors
30
Q

How do you calculate Labour Productivity?

A

labour productivity = output/number of employees

31
Q

How to Increase Productivity

A
  • train employees
  • improve motivation
  • better capital equipment
  • increase quality control checks
  • set targets
32
Q

Define Economies of Scale

A

Unit cost falls due to increased output.

33
Q

Define Technological Economies

A

Larger businesses can afford to best in expensive and specialist capital machinery.

34
Q

Define Purchasing Economies

A

Larger businesses can buy in bulk and therefore receive discounted prices.

35
Q

Define Marketing Economies

A

Larger businesses can spread its advertising/marketing budget over a larger output.

36
Q

Define Specialisation Economies

A

Larger business can split complex production processes into separate tasks to boost productivity.

37
Q

Define Managerial Economies

A

Larger businesses can afford specialist employees to versed production.

38
Q

Define Financial Economies

A

Larger businesses are usually seen as more “ credit worthy” and can access more credit facilities, with better rates of borrowing.

39
Q

Define Network Economies

A

Adding one more user to the network costs next to nothing but the affects could be huge as the new user can interact and share ideas with existing members.

40
Q

Define Risk-Bearing Economies

A

Larger businesses can afford to take risks as the damage is likely to be minimal.

41
Q

Define Productivity

A

The amount of output per given unit over a period of time.

42
Q

How do you calculate Productivity?

A

productivity = output/input

43
Q

Define Diseconomies of Scale

A

Occur when a business grows so large that the cost per unit increases.

44
Q

Define Poor Communication

A

As business expands, communicating between department becomes more difficult.

45
Q

Define Lack Of Motivation

A

Workers may feel more isolated and less appreciated in a larger business so loyalty and motivation may diminish.

46
Q

Define Loss of Direction and Coordination

A

In a larger business, it’s harder to ensure all workers are working towards the same goal; harder to control employees.

47
Q

Define Poor Organisation

A

As the business grows, ,amateurs may loose control gear employees and working areas may become harder to supervise.

48
Q

Define External Economies of Scale

A

Occur outside of a firm but within an industry.

49
Q

Define Capacity Utilisation

A

The percentage of total capacity that is actually being achieved in a given time.

50
Q

How do you calculate Capacity Utilisation?

A

(actual level of output/maximum possible output) x 100

51
Q

What capacity utilisation do businesses aim for?

A

85%-90% allows for fluctuations in demand and breakdowns in machinery.

52
Q

How to Improve Capacity Utilisation

A
  • increase demand
  • differentiate the product
  • reduce maximum capacity
53
Q

Advantages of Capacity Utilisation

A
  • fall in average costs
  • less wastage
  • increased profits
  • increased competitiveness
54
Q

Disadvantages of Working at 100% Capacity

A
  • can’t deal with maintenance issues or breakdowns
  • can’t increase productivity to deal with demand
  • lots of pressure
55
Q

Define Stock Control

A

The processes and controls used by a business to ensure that it has sufficient stock for its purpose.

56
Q

What are the 3 types of stock?

A
  • finished goods
  • raw materials
  • work in progress
57
Q

Define Lead Time

A

Difference between the time and order was placed and the time you receive the goods.

58
Q

Define Maximum Stock Level

A

Highest amount of stock a business can or wants to hold.

59
Q

Define Re-Order Level

A

A “trigger point” that indicates when the next order must be placed.

60
Q

Define Minimum Stock Level

A

The smallest amount of stock a business would want to hold.

61
Q

Costs of Holding Too Much Stock

A
  • money is held up
  • not enough space
  • theft or damage of stock
  • perishability
  • insurance will need to be paid
  • deprecation (may lose its value)
62
Q

Benefits of Holding Stock

A
  • a business can meet demand

- business could benefit from EOS

63
Q

How do you calculate Average Stock Level?

A

stock level = (max. stock + min. stock)/2

64
Q

Define Stockout

A

When a business runs out fo stock or is holding too little stock.

65
Q

Define LIFO (last in first out)

A

Old stock is used up first, taking priority over new stock.

66
Q

Define FIFO (first in first out)

A

First lot of stock into warehouse is first out of warehouse.

67
Q

Define EPOS (electronic point of sale)

A

Any computerised device that is used to record sales and control stock.

68
Q

Define Kanban

A

Supply of components regulated through the use of a traffic light system; lights go green when more stock needs to be ordered.

69
Q

Define JIT (just in time)

A

Where a business order stock at the last minute to minimise waste and storage used.

70
Q

Define EOQ (economic order quantity)

A

The order quantity that minimises total stock h9lding costs and ordering costs.

Business (7 decks)

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