Role Of Operations Management Flashcards
Define transformation
Transformation is the concersion of inputs (resources) into outputs (goods and services)
Define operations
Operation refers to the business profess that involve transformation or more generally production. Value adding is formed through transformation.
Define value adding
Value adding is the creation of extra or added value as inputs are transformed into outputs
List the business inputs in transformation of a good
LIRM –> goods
Labour resources
Ideas and information
Raw materials
Machinery and equipment
List the business inputs in transformation of a service
TESTMQ –> service
Time Education Skill Technology Machinery Qualification
Define lean production
Lean production is the elimination of waste at every stage of production.
List the types of cost in operations function
Input cost Labour cost Processing cost Inventory cost Quality management cost
Define cost leadership
Cost leadership aims to have lowest or most price competitive cost in the market. Business should have lowest cost which is still profitable
Define economies of scale
Economies of scale refers to cost advantages that can be created as a result of an increase in scale of business operations. Cost savings are from being able to purchase lower cost per unit from efficiencies of production.
How can a good differentiate from conpetitors in operations management?
Varying actual product features: breakfast cereal can be wholegrain, less sugar, added fruit etc
Product quality:
low quality –> affordable
High quality –> expensive
Some companies are same but change trademark for example lexus and toyota
Varying any augmented feature: refers to add ons or additional benefits associated with particular goods for example add on parts for a car.
How can a business differentiate its services in operation management?
Expertise level
Qualification and experience
Quality of materials in service
Time spent on service
EQQT
Management of operations will vary on standardnised goods or customised goods. Explain differences.
Standardnised goods are:
- mass produced usually assembly line
- production focus
- meet predetermined level of quality
Customised goods are:
- varied according to needs of customers
- produced within a market focus
Processes will vary depending on perishable and non perishable goods define terms and explain different process approaches.
Perishable goods have a short lifespan and processes are different. Such as fruits, milk and bread
- high standards of quality and cleanliness
- distribution is quick and effective
- cold storage through production and distribution
Non perishable goods are more durable and have longer life span such as computers, clothing, footwear.
- quality in process from production to distribution
- highly responsibe to market demand and not over produce
- effective inventory management
Explain the process of intermediate goods
Intermidate goods may be finished but become an input for a new product.
Steel–>screws–>electronic device
