Unit 2 - Business Operations Flashcards
JIT and JIC
JIT = holds just enough
JIC = hold more, in case of sudden surge in demand
Job vs Flow
Job:
+ unique, higher prices, high quality, flexible
- slow, skilled labour, expensive
Flow:
+ large quantities, automated, continuous, EOS
- high costs for machinery and breakdowns, low motivation, inflexible
Pros and Cons of JIT and JIC
JIT:
+ less space needed, lower stockholding costs, customization for each order
- risk if: supplier is delayed or unreliable, surge in demand.
JIC:
+ meets sudden demands, lower risk if suppliers are slow, EOS
- higher stockholding costs, stock may expire, may need to discount stock to sell
Suppliers chosen on basis of (3)
- price
- quality
- reliability
Procurement is…
process of buying materials from suppliers to produce own products / services
Direct and Indirect Procurement
Direct:
- used in making of product
Indirect:
- additional
Logistics is the….
movement of goods in production process
Supply Chain efficiency is improved by
material purchased when needed
products made to order
waste is reduced
Quality Benefits
positive brand image
can charge a higher price
reputation
reduces waste and increases efficiency
lower costs (less returns)
Quality Costs
training staff
cost of raw materials
inspection costs
product recalls
customer service costs
Maintaining quality types:
- Quality Control
- Total Quality Management
- product checked at end of production process
- quality is responsibility of all employees + assessed at end of stage in production process
Quality Control (2+ / 4-)
+ can be monitored by expert(s)
+ common issues can found
- operatives have less responsibility
- requires specialist
- issues only identified at end
- waste levels can be high
