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Business > Topic 4 - Operations > Flashcards

Topic 4 - Operations Flashcards

1
Q

JOB production DEFINITION

A

products made individually

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2
Q

BATCH production DEFINITION

A

a group of products made together then switches

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3
Q

FLOW production DEFINITION

A

production of one product continuously using an assembly line (mass production)

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4
Q

JOB production ADVANTAGES

A
  • high quality item
  • designed to meet customer needs
  • high price charged —> lots of profit
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5
Q

BATCH production ADVANTAGES

A
  • batches varied to meet different customer needs
  • no storage costs if goods made to order
  • cheaper than job
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6
Q

FLOW production ADVANTAGES

A
  • large quantities produced
  • use of machinery and automation reduced costs
  • use of computer controlled machinery allows variation
  • large scale production reduces unit costs
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7
Q

JOB production DISADVANTAGES

A
  • slow production
  • customer may have to wait
  • can be high cost as needs skilled workers
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8
Q

BATCH production DISADVANTAGES

A
  • machines need resetting (costly)
  • stocks of raw materials needed (costly)
  • tasks may be repetitive leading to motivation and retention problems
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9
Q

FLOW production DISADVANTAGES

A
  • may not be high quality
  • storage needed for large amounts
  • production can be disrupted due to technical faults
  • tasks may be repetitive leading to motivation and retention problems
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10
Q

TECHNOLOGY definitions (automation, robotics)

A

AUTOMATION - production process involving machinery controlled by a computer rather than a person

ROBOTICS - use of robots in production process

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11
Q

ADVANTAGES of using technology in production

A
  • replaces workers reducing costs
  • worker productivity increased as computers help work faster reducing costs
  • waste reduced as machines more accurate than humans
  • flexible production as machines can be programmed to change
  • technology can run 24/7 reduces cost and increases output
  • human safety improved as robots do dangerous jobs
  • can lead to new products
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12
Q

DISADVANTAGES of using technology in production

A
  • may need skilled workers to program computers
  • workers may need to be retrained to work with new technology, expensive
  • machines can break down disrupting production
  • new technology can be expensive
  • customers may not like automation
  • storage of data about customers must meet the requirements of data protection laws
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13
Q

ADVANTAGES of providing quality goods and services

A
  1. WASTE REDUCED which reduces:
    - recalls of defective products
    - returns from dissatisfied customers
    - goods being sold cheaper if faulty leading to lower price and profit
  2. GOOD REPUTATION:
    - satisfied customers will come back (retention)
    - will tell friends and family if had a god experience, new customers
    - reduces risk of poor reputation
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14
Q

define QUALITY CONTROL

A

physical inspection to check each product is of high standard eg mystery shopper

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15
Q

ADVANTAGES of quality control

A
  • stops poor quality goods and services being sold
  • production can continue (output not continued)
  • producing good quality improves reputation
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16
Q

DISADVANTAGES of quality control

A
  • doesn’t prevent waste
  • inspection is costly (unless done by machines)
  • doesn’t encourage workers to be responsible for quality
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17
Q

ADVANTAGES of quality assurance

A
  • reduce wastage and costs

- all workers responsible for quality which may motivate workers to take care

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18
Q

DEFINE quality assurance

A

makes all workers responsible for quality, whole business focusing on quality to stop quality problems arising

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19
Q

DISADVANTAGES of quality assurance

A
  • workers may be stressed about the responsibility of having to check the quality of their own work
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20
Q

ADVANTAGES of face to face selling (when buyer and seller meet in a shop)

A
  • can increase sales
  • good when customers like advice and personal service from assistants
  • can help sales in business to business selling
  • for some it may be unavoidable
  • customer can bargain with seller over price or services
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21
Q

DISADVANTAGES of face to face selling (when buyer and seller meet in a shop)

A
  • may not be convenient for customers
  • if customer bargains for better price, profit lost
  • high retailer costs if expensive shops are needed
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22
Q

ADVANTAGES of telesales (buyer buys from a telesales worker by phone)

A
  • can increase sales as customers can ask questions about products and bargain about price
  • may cost less than selling in a shop
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23
Q

DISADVANTAGES of telesales (buyer buys from a telesales worker by phone)

A
  • costs involved eg warehouse to store goods and payment to telesales workers
  • sellers may ‘cold call’ which can be a nuisance to customers
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24
Q

ADVANTAGES of e commerce to customers

A
  • online selling has made it easier for customers to compare prices and find the best deals
  • customers can buy 24/7
  • choice has increased because customers can buy from sellers around the world
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25
Q

DISADVANTAGES of e commerce to customers

A
  • its impersonal and so customers may not be able to ask questions (unless online chat available)
  • goods bought and seen online so may not be what customer wanted when they arrive, customers must return goods at their own cost
  • if the computer systems aren’t secure, customers may be at risk of personal data theft and bank fraud
  • not everyone can access to or can use computer technology
26
Q

influences of e commerce on business

A

1) LEVELS OF EMPLOYMENT - some have reduced bc technology is used
2) NEW SKILLS - recruit workers with technology skills
3) LOCATION - cheaper as can use cheap out of town warehouses rather than expensive shops in town
4) PROVISION OF CLICK AND COLLECT SERVICES - need storage and staff to deal with this
5) CREATION OF NEW DEPARTMENTS - creation of online departments
6) BUSINESS OPPORTUNITIES - increased business opportunities in retailing, banking, insurance sales and accountancy, markets now worldwide
7) DELIVERY OPTIONS - speed of delivery is important

27
Q

DISADVANTAGES of e commerce to business

A
  • competition has increased, greater competition abroad
  • delivery systems need to be organised as well as ways of dealing with the increase in goods that are returned
  • e commerce businesses need to provide cyber security for themselves and their customers
  • as technology develops so must the e commerce businesses which can add to costs and lead to change in the operation of the business and the workers it needs
28
Q

ADVANTAGES of e commerce to business

A
  • markets have increased as businesses can more easily sell around the world
  • possible to sell 24/7
  • costs of selling are usually much lower as a result of savings on rental of premises and a reduction in the number of workers that need to be employed
29
Q

the importance of PRODUCT KNOWLEDGE (pros and cons)

A

+ increases sales as customers are given information to help make a good decision
- costs in training staff

30
Q

the importance of CUSTOMER SERVICE (pros and cons)

A

+ increases sales by making customers feel confident about the seller and what they are buying
+ encourages repeat customers
- costs in terms of training workers to deal with customers and provide refunds

31
Q

the importance of AFTER SALES SERVICE (pros and cons)

A

+ a good after sales service increases sales as customers can buy with confidence

  • costs in training workers to deal with customers and provide refunds
  • returned goofs may have to be sold at a loss as clearance goods
32
Q

the importance of CUSTOMER ENGAGEMENT (pros and cons)

A

+ increases sales as customers feel comfortable with buying experience
- costs in training staff

33
Q

what does GOOD CUSTOMER SERVICE mean for the business?

A

helps a business to gain and retain customers

34
Q

what is the CONSUMER LAW?

A

designed to protect consumers from unscrupulous sellers

1) products must be:
- of satisfactory quality
- fit for purpose
- as described

2) advertising must be legal, decent, honest and truthful

35
Q

impact of production of quality goods and services on the business (consumer law)

A

business must have good quality control or assurance processes

when law is broken:

  • business will need to either replace or repair a faulty good or provide a refund
  • business may lose a sale
  • will cost the business to replace or repair a product
  • business may gain a reputation for poor quality leading to a reduction in sales
36
Q

impact of advertising on the business (consumer law)

A

business must be legal, decent, honest and truthful in its advertising

when law is broken:

  • goods can be returned by the consumer which costs money
  • business may gain a reputation for poor quality leading to a reduction in sales
37
Q

impact of safety of goods on the business (consumer law)

A

business must make sure the design of its product is safe and that services are provided in a safe way

when law is broken:

  • business could have to pay out a lot of money in compensation for causing injuries or death
  • business may gain a reputation for poor quality leading to a reduction in sales
  • business will have to stop selling the unsafe product or service which can cost money
  • business may be forced to close
38
Q

factors influencing LOCATION?

A
  • costs
  • proximity to market
  • proximity to labour
  • proximity to materials
  • government
39
Q

explain COST as a factor influencing location

A
  • locating in a low cost area enables the business to save on cost of renting an office or wages
  • areas with good transport links keeps transport costs low (motorways, rail, sea, air)
  • access to reliable cheap and fast ICT communication
40
Q

explain PROXIMITY TO MARKET as a factor influencing location

A
  • service businesses locate near customers as there are lots of customers
  • manufacturing businesses may locate near customers for easier communication
  • a business located near its customers may be able to reduce costs of transporting to customers
41
Q

explain PROXIMITY TO MATERIALS as a factor influencing location

A
  • business may locate near suppliers of raw materials to save on transport costs
  • shorter transport journeys good for environment, enables business to be more environmentally friendly
42
Q

explain GOVERNMENT as a factor influencing location

A
  • government may give businesses grants towards set up costs, may reduce corporation tax for businesses locating near high unemployment, encouraging firms to locate in enterprise zones
43
Q

define PROCUREMENT

A

the management of purchasing within a business

44
Q

explain the stages of PROCUREMENT

A

1) identifying goods and services to buy
2) choosing suppliers
3) ordering goods and services
4) receiving deliveries from suppliers

45
Q

influences on identifying goods and services to buy (procurement)

A
  • which season the business is buying for
  • changes in technology affect the products a business sells
  • changes in fashion and lifestyle affect the products a business sells
46
Q

influences on choosing suppliers (procurement)

A
  • dependent on the quality of goods or services consumers want
  • reputation and reliability of suppliers is important
47
Q

influences on ordering goods and service is (procurement)

A
  • a business completes an order from stating what it wants and sends it to the supplier
48
Q

influences on receiving deliveries from suppliers (procurement)

A
  • a business will arrange for workers to receive the goods and have an area where they can be stored
49
Q

define LOGISTICS

A

the process of organising the transport of goods from the seller to the buyer

50
Q

define LOGISTICS and SUPPLY CHAIN

A

LOGISTICS - the process of organising the transport of goods from the seller to the buyer

SUPPLY CHAIN - the chain of businesses involved in the production of a product and its delivery to the user

51
Q

explain TIME as a logistical issue and its potential problem

A

supplier must be able to deliver goods on time

  • supplier may be short of materials or components, delaying production. business could lose revenue and sales as a result
52
Q

explain RELIABILITY as a logistical issue and its potential problem

A

supplier must be able to supply the quantity and quality of goods needed by the customer

  • if supplier short of materials or they aren’t of sufficient quality may have to delay or stop production. business could lose revenue and sales as a result
53
Q

explain LENGTH OF THE SUPPLY CHAIN as a logistical issue and its potential problem

A

long supply chain has an increased risk of problems occurring along the chain

  • a business which makes a component may not get materials it needs and so cannot produce the components its customer needs to assemble its product
54
Q

explain CUSTOMER SERVICE as a logistical issue and its potential problem

A

supplier will need to provide a customer service to deal with problems and enquiries from its potential and actual customers

55
Q

define BREAK EVEN POINT

A

the amount a business must sell to earn enough revenue to just cover its costs so it doesn’t make a profit or loss

total revenue = total costs

56
Q

calculation for BREAKEVEN

A

= fixed costs /

price - variable costs per unit

57
Q

uses of BREAKEVEN forecast

A

1) PLANNING HOW MUCH TO PRODUCE: forecast shows how much the business must sell to break even
if the business doesnt think it can sell this much it may stop production but if it can it may decide to produce this amount initially then increase production as it nears breakeven

2) PLANNING THE PRICE TO CHARGE:
forecast shows that business will not break even at proposed selling price
business may decide to increase price to increase revenue and reduce breakeven output but if market is competitive may not be possible . business could try to reduce costs by buying materials or stock form cheaper supplier

58
Q

problems with BREAKEVEN

A
  • only a prediction so things may change in future
  • business may not be able to sell at price planned, new competition in market may force price down or demand may be lower at that price (incomes may have fallen or price too high)
59
Q

explain the ECONOMIC CLIMATE

A

CONSUMER INCOME LEVELS - level of income people have because it influences how much people can buy

EMPLOYMENT - influences income, people with jobs have a better income than people without

60
Q

impacts on business of rising income and employment

A
  • many businesses will experience an increase in sales as consumers have more money to spend. business production and profits may increase
  • sales of luxury goods will increase more than sales of necessities as more affordable for people now
  • businesses that produce cheaper goods and services experience a fall in sales as people switch to better more expensive goods

Business (3 decks)

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