The nature of operations 4.1 Flashcards
Define the term “Production”
Converting inputs into outputs.
Define the term “Level of production”
The number of units produced during a time period.
Define the term “Productivity”
The ratio of outputs to inputs during production.
Define the term “Efficiency”
Producing output at the highest ratio of output to input.
Define the term “Effectiveness”
Meeting the objectives of the enterprise by using inputs productively to meet customer’s needs.
Define the term “Labor intensive”
Involving a high level labor input compared with capital equipment.
Define the term “Capital intensive”
Involving high quantity of capital equipment compared to labor input.
Define the term “Operations planning”
Preparing input resources to supply products to meet expected demand.
Define the term “Computer aided design (CAD)”
The use of computer programs to create 2 or 3D graphical representations of physical objects.
Define the term “Computer aided manufacturing (CAM)”
The use of computer software to control machine tools and related machinery in the manufacturing of components or complete products.
Define the term “Process innovation”
The use of a new or much improved production method or service delivery method.
Define the term “Job production”
Producing a unique item specifically designed for the customer.
Define the term “Batch production”
Producing a limited number of identical products before moving onto producing another group of identical products.
Define the term “Flow production”
Producing items in a continually moving process.
Define the term “Mass customization”
The use of flexible computer-aided production systems to produce item to meet individual customers requirements at pass production cost levels.
List 2 Advantages of job production.
- Able to undertake specialist projects or jobs often with high added value.
- High levels of worker motivation
List 2 Disadvantages of job production.
Answers may include :
- High unit production costs
- Time consuming
- Wide range of tools and equipment needed
List 2 Advantages of batch production.
Answers may include :
- Some economies of scale to benefit from
- Faster production with lower unit costs than job production
- Some flexibility in design of product in each batch
List 2 Disadvantages of batch production.
- High levels of stocks at each production stage.
- Unit costs likely to be higher than with flow production.
List an Advantage of flow production.
Low unit cost due to constant working of machines, high labor productivity and economies of scale.
List 2 Disadvantages of flow production.
- Inflexible as it is difficult and time consuming to switch to another type of product.
- Expensive to set up the machinery.
List an Advantage of mass customization.
Combines low unit costs with flexibility to meet customer’s individual requirements.
List 2 Disadvantages of mass customization.
- Expensive product redesign may be needed to allow key components to be switched to allow variety.
- Expensive flexible capital equipment needed.
Define the term “Optimal location”
A business location that gives the best combination of quantitative and qualitive factors.
Define the term “Multi-site location”
A business that operates in more than one location.
Define the term “Offshoring”
The relocation of a business process done in one country to the same or another company in another country.
Define the term “Multinational”
A business with operational or production bases in more than one country.
List 3 Advantages of multi-site location businesses
Answers may include :
- Greater convenience for consumers
- Lower transportation costs
- Opportunities for delegation of authority to regional managers from head office. This helps to develop staff skills and improve motivation.
- Cost advantage of multi-sites in different countries.
List 3 Disadvantages of multi-site location businesses
Answers may include :
- Coordination problems between locations.
- Potential lack of control and direction from senior management based at head office.
- Different cultural standards and legal systems in different countries.
- if sites are too close to each other, there may be a danger of “cannibalism” where one restaurant or store takes sales away from another owned by the same business.
Define the term “Trade barriers”
Tariffs or other limitations on the free international movements of goods and services.
Define the term “Scale of operation”
The maximum output that can be achieved using the available inputs.
Define the term “Economies of scale”
Reduction in a firm’s unit costs of production that results from an increase in the scale of operations.
Define the term “Diseconomies of scale”
Factors that cause average costs of production to rise when the scale of operation’s increased.
Define the term “Enterprise resource planning”
The use of a single computer application to plan the purchase and use of resources in an organization to improve the efficiency of operations.
Define the term “Supply chain”
All of the stages in the production process from obtaining raw materials to selling to the consumer from point of origin to point of consumption.
Define the term “Sustainability”
Production systems that prevent waste by using the minimum if non-renewable resources so that levels of production can be sustained in the future.
