Unit 3 AOS3 Operations Management Flashcards
Operations management
is concerns with the strategies that are used to create, operate and control the transformation of inputs from a variety of resources into output (goods and services) to satisfy the demand of customers.
Operations managers make use of strategies including
management of materials, quality, waste and use of technology.
Effectiveness
refers to the degree to which a business had accomplished its objectives.
Efficiency
how well a business uses resources in achieving these objectives.
what is a measure of efficiency
productivity — how many inputs (resources) it takes to produce output (goods or services).
If a business reduces the amount of waste produced while achieving its objectives, then this is considered to be efficient.
Relationship Between Operations
Decisions made by operation managers have direct impact on the level of business competitiveness* and attainment of business objectives:
Business Competitiveness
the ability of a business to sell products in a market.
A business will be competitive when it is able to produce goods or services at the same level or better than competitors
how can operations managment increases objectives
Operations managers can contribute to the achievement of business objectives by improving levels of efficiency and effectiveness in a business’s production process.
what is the business objective make a profit?
profit is what is left after business expenses have been deducted from revenue
what is the business objective of Increase market share
the portion of a market or industry that a business owns. increasing business sales creates a higher amount of the market owned by the company.
what is Fulfill a market need:
find the space in the current market, design new products or make improvements on existing products to meet customer needs.
Fulfill a social need
business activity’s improves society, human wellbeing.
involves production and selling of goods and services for the purpose of making the world a better place.
Meet shareholder expectations
shareholders expect to make a return on investments therefore expect business to make a profit, as they receive a proportion(dividends)
shareholder expectations willl be met by the profit made by company being returned to shareholders or the value of company shares increase
what are the key elements of an operation system
inputs
processes
outputs
what are Inputs
The resources used by a business to produce goods and services.
Operations managers are responsible for sourcing inputs that allow a business to produce the highest quality product at the lowest possible cost.
Inputs include:
- labour resources (employees)
- raw materials (unprocessed materials)
- capital resources (physical asset), such as equipment and machinery and property necessary to conduct the operations
- time, a non renewable resource (if wasted will add to production costs and cause productivity to fall.)
-utilities, such as electricity, water, and gas
Processes/transformation
The actions performed by a business to transform inputs (resources) into outputs(goods or services)
The operation system of manufacturer tends to be highly automated or mechanized. Service provides rely heavily on the interaction with the customer and their process tend to be more labor intensive.
Processes include:
mixing , designing , baking , computing , cutting , washing , assembling constructing.
Outputs
The final goods and services produced as a result of a business’s operations system, that are delivered or provided to customers.
