Production Of Goods And Services Flashcards
Define production
The combination of inputs to produce valuable outputs
OR
The provision of goods and services to satisfy customer needs and wants
List and explain the departments found under the Operations Department
Factory manager- in charge of the quality and quantity of goods and services
Purchasing manager- in charge of providing materials/equipment required for production
Research and development- in charge of the testing&designing of new production processes
How do you calculate productivity & labour productivity
Productivity = output/ quantity of input
Labour’s productivity = output over a given period/ no. of employees
How can productivity be raised?
Keeping inputs the same but output higher or reducing inputs but keeping outputs the same
Ways of increasing productivity
- Improve quality & reducing inventory
- Replacing employees with machines
- Introducing new technology
- Training employees
- Automation
- Motivating employees
Benefits of increasing productivity
- Reduced inputs needed for the same output level
- Lower production cost per unit
- Fewer workers therefore less wage expense
- Motivation to workers as they are paid more
Why do businesses keep inventory?
To maintain productivity and quickly satisfy customer needs
What happens when inventory is too high or too low?
If inventory is high, storage will be full andnotbeused, of which money could be spent elsewhere
Too low levels leads to disruption in supply of customer need
Define lean production
Techniques used in a business to cut down waste
What are the types of waste in production
- Overproduction- making products before orders are made
- Waiting- no production occurring
- Over-processing- using machines for simple tasks
- Transportation- the constant movement of products can lead to damage
- Motion- employees unnecessarily moving around
- Unnecessary inventory- too much of it fills storage and increases costs
- Defects- faults needed to be fixed
Benefits of lean production
Costs are reduced through;
-less storage occupied
-qquicker production
-no need to repair defects
-better use of equipment
-less money tied up in inventories
Explain what happens in Kaizen (a type of lean production)
It means continuous improvement whereby employees detect problems in the work place and work as one to find solutions
The factory floors are basically reorganized so work flow is efficient and there’s less movement
What are the benefits of Kaizen?
- fast productivity
-work in progress is reduced
-Improved factory layout
-reduced amount of space for the production process
Explain what Just-In-Time inventory control is
This is a method that reduces the need to hold inventories of raw materials, unfinished and finished goods
Advantages of JIT inventory control
-saves costs
- reduced space
-finished products are sold quick
What is cell production?
This is where production is divided into separate, self contained units called cells with each cell making an identifiable part of the finished product.
Advantages ofcell production
-provides staff morale and makes them work harder
-employees feel valued and are less likely to strike
List 3 methods of production
-job production
-batch production
-flow production
What happens in job production?
This is whereby products are produced one at a time, specifically according to an order
List the advantages of job production
- most suitable for personal services
-the products meet customers satisfaction - flexible way of production
List the disadvantages of job production
-requires skilled labour
-production takes longer
- products are specifically made therefore if there are any errors it’s expensive
- materials are specifically ordered
Explain what batch production is
Similar products are made in blocks/batches
Advantages of batch production
-flexible way of working
-it gives some variety to workers
-production may not be greatly affected if machines stop working
-gives consumers more choices
Disadvantages of batch production
-its expensive as semi-finished products will need to be moved to the next production stage
-machines have to be reset between beaches
-warehouse space is costly
Define flow production
Thus sis when large quantities of a product are produced in continuous process
Advantages of flow production
-high output
-automated lines work for 24 hours
-no need to move products from one part of the factory to another
-average costs are low
-reduced labor costs
Disadvantages of flow production
-lots of storage is required
-its BORING
-if machine breaks down there’s no production
-setting up costs are high
List & explain the factors affecting the method of production
a) The nature of the product
Specifically made products will need job production while if mass products are needed flow production may be used
b) The size of the market
If the demand is higher and more products can be sold but not in very large quantities, batch is suited while if it’s it’s niche market either job or batch is suitable. International markets may use flow production
c) The nature of demand
If the product is highly demanded like soap then flow production, if it’s less in demand like furniture then batch or job production
d) The size of the business
If the business is small (job/batch) if the business is large (flow)
How does technology change production methods?
- Automation- equipment used I controlled by computers to carry out mechanical processes, but only a few people are required to ensure everything goes accordingly
- Mechanization- machines are operated by humans (printers)
- Robots- programmed to do dangerous/difficult jobs Humans can’t do. Are quick and worked hrs
- EPOS( Electric Point Of Scale)- used at checkouts where barcodes are scanned and price and details are outputted on the monitor and a receipt is printed.
- Contact less payment- is fast, easy and secure way to pay for purchases of a small amount
Advantages of introducing new technology
-productivity
- better quality products
- quicker communication
- new products available
- job satisfaction amongst employees as work won’t be boring no more
- workers are trained and learn new skills
Disadvantages of new technology
- unemployment
- expensive to invest in
-employees may feel unhappy with changes - updates/upgrades needed which may he costly
