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Unit 3 & 4 Business Management > Unit 3 Outcome 3b > Flashcards

Unit 3 Outcome 3b Flashcards

1
Q

What are strategies used to optimise operations?

A

. facilities design and layout
. materials management
. management of quality
. extent of the use of technology

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2
Q

What is facilities design and layout?

A

. involves planning of workspace to streamline the production process.
. It’s about optimising operations and about ensuring production will run smoothly and efficiently, this is done with many different layouts.

Important when deciding location and design:
. Type of product being created
. Space required 
. Proximity to suppliers and labour 
. Access to services
. Type of layout
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3
Q

What are the different layouts?

A 
. fixed position layout (manufacturing)
. product layout (manufacturing)
. process layout (manufacturing and service)
. retail layout (service)
. office layout (service)
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4
Q

Why is the facilities design and layout important?

A

. When arranged in order it will achieve the highest levels of efficiency in production.
. The best layout will optimise operations, meaning it will result in improved productivity, satisfied costumers and deadlines being met.

. If the wrong layout is chosen or processes are not linked it can cause a loss of productivity which increases production costs and can harm competitiveness

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5
Q

What does a manager need to consider when choosing the best layout?

A

Whether or not there is:
. enough space for the anticipated volume of production
. effective use of production equipment technology
. an adequate location of stock and warehousing requirements
. an efficient flow of the goods and services through the system
. conformity with legal regulations

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6
Q

Explain the fixed position layout?

A

. This is where the product remains stationary while materials and labour are taken to the product.
. Used when it is too difficult to move the product, hence why large-scale processes such as the construction of bridges, ships, aircraft or buildings are appropriate uses of this layout.

PROS AND CONS
. Allows for high variety and customisation
. Allows for high quality finishing
. Large investment required
. It is more efficient to bring materials to the site,
. however it does mean there is space restrictions for storage

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7
Q

Explain the product layout?

A

. This deals with the manufacturing of goods in mass volume using an assembly line. It involves moving goods from workstation to workstation in sequential order along an assembly.

PROS AND CONS:
. cost is reduced because of the use of technology and because staff are trained to complete specialised tasks,
. Minimal variation too
. however it can be expensive to set up a capital-intensive, automated assembly.
. Not only that, a problem on the production line can result in the whole factory shutting down.
. Furthermore, staff can become bored with repetitive low-skilled activities.
. Economies of scale
. Problems can cause production to stop

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8
Q

Explain the process layout?

A

. This is when equipment and work centres are arranged into similarity of function.
. This deals with high varieties of products by grouping activities, equipment and machinery of similar function together.
. Used for products that require variety
. Eg. Hospitals and banks

PROS AND CONS
. Greater flexibility
. Greater amount of variety/customisation
. Less stoppages in comparison to product layout

. Longer production time
. Work can be monotonous for staff if they are only involved in one areas

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9
Q

Explain the retail layout?

A

. This is a service layout which is all about attracting costumers and getting them to stay as long as possible.
. This is to get costumers to buy products.

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10
Q

Explain the office layout?

A

. This is another layout which is all about the efficient movement of information and proximity to resources such as the photocopier, computes, printers and storage areas.

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11
Q

What is materials management?

A

. Materials management is the strategy that manages the use, storage and delivery of materials to ensure the right amount of inputs is available when required in the operations system.
. It is important because it is used to optimise operations, meaning it will result in less waste as the precise amount of materials required is calculated.

The Operations Manager must:
. Ensure there is the correct amount of materials
. Ensure materials are on hand when needed
. The materials are the right quality
. The materials aren’t idle for too long.

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12
Q

What does materials management involve?

A

. receiving materials
. storing materials safely
. controlling the release of materials into the production process
. reducing holdings of surplus stock
. identifying ongoing materials requirements by ensuring timely purchase of materials
. identifying ongoing materials requirements by forecasting

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13
Q

What is inventory?

A

This is the goods and materials held as stock by an organisation.
. a large inventory is held by an organisation to ensure that materials do not run out, however this represents a cost to the organisation.

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14
Q

What is materials handling?

A

This is the physical handling of goods in warehouses and at distribution points.

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15
Q

Explain the following materials planning strategy: production plan

A

. This is an outline of what is to be produced, how it will be produced and in what quantity.
. Helps to really determine what materials are needed.

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16
Q

What materials planning and controlling inventory strategies are there?

A

Materials Planing
. Production plan
. Master production scheduling
. Materials requirements planning

Controlling Inventory
. Inventory control
. Supply chain management
. Just in time

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17
Q

Explain the following materials planning strategy: master production scheduling

A

. This details what is to be produced and when its going to be produced.
. It breaks down the production plan into:
- quantity and type of each product and service
- how, when and where the production will take place
- labour requirements.

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18
Q

Explain the following materials planning strategy: materials requirements planning

A

. This involves developing an itemised system of all materials involved in production to meet the specified orders in Master Production Scheduling.

. The planning must consider lead times require by suppliers, the exact number of inputs required, the amount of stock on hand and purchasing procedures.
. The reduces waste and therefore improves efficiency.

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19
Q

What is inventory control?

A

. All about ensuring that costs are minimised and that the operations system has access to the right amounts of inputs when required.

. A common approach used by organisations is just in time (JIT) system of inventory control.

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20
Q

Explain the following inventory control: just in time

A

. This system ensures that the exact amount of material inputs will arrive only as they are needed in the operations process.

. This reduces production costs as it means inventory holdings is reduced, meaning decreased storage space required.
. However any factor that affects the delivery schedule can shut down the whole production process.

21
Q

Explain the following inventory control: supply chain management?

A

. Involves assessing the locations in terms of distance to suppliers which an organisation purchases materials and resources from.

  • materials must arrive on time
  • materials must meet quality expectations
  • supply chain must be cost effective
22
Q

Why is supply chain management critical?

A

. if materials are not on hand, nothing can be produced
. if materials are of inferior quality, it is difficult or costly to produce quality products
. if the right quantity of materials is not available, the organisation cannot meet demand

23
Q

What is the management of quality in the operations management function?

A

. This is all about ensuring products meet customer expectations.
. Three quality strategies are quality control, quality assurance and total quality management

24
Q

What is quality?

A

. This refers to the degree of excellence of goods or services and their fitness for a stated purpose.
. Quality management of the production process ensures that outputs produced are consistently reliable and durable.

When managing quality, LSO’s will:
. minimise waste and defects
. strictly conform to standards
. reduce variations in final output

Quality systems include/strategies include:
. Quality control
. Quality Assurance
. Total Quality Management

25
Q

What is quality control?

A

. This involves the use of regular inspections at various points in the production process to check for problems and defects.

. Specifications or benchmarks are set before the physical checks are completed.
. When there are faults, take any corrective action necessary.

. Competitiveness increases as the costs associated with waste and faulty products are reduced.

26
Q

What is quality assurance?

A

. This is a system where the organisation meets a set of predetermined quality standards.
. This aims to avoid defects before they occur, therefore it aims to build quality into the work process.
(Meeting an independent bodies predetermined standards)
. It may involve the use of an external agency that audits the org. and sets the standards.
. If an org. meets these quality standards, it is then entitled to use the certification of the external org.
. this provides and competitive advantage

27
Q

What is total quality management?

A

. This is an on going, organisation-wide commitment to excellence that is applied to every aspect of the organisations operation.

. The aim is to crate a defect-free production process and maintain costumer focus in operations.
. Employees are responsible for quality, employees are empowered and there is continuous improvement.

28
Q

Describe the use of technology in operations management?

A

. Technology is the use of machinery, robotics and computers within an organisation to enhance productivity, efficiency and consistency.
. When an organisation looks to improve its operations system, they often turn to technology to help.

. It is also one of the best ways to improve productivity.

29
Q

What can technology be used to?

A

. produce g & provide s faster, (using less labour and thereby, reducing costs and increasing productivity)
. increase quality of g&s (leading to increased profitability)
. fewer errors may be made
. less waste may result
. reach more costumers (eg. mobile phones and internet)
. increase business competitiveness
. Improve health and safety

Cons:
. Workers need to get trained (time and money)
. Tech. can replace jobs
. High initial cost and maintenance cost
. Less tech. savvy employees may fear the change

30
Q

What is costumer relationship management? (CRM)

A

. This refers to the systems that organisations Re introducing to maintain customer contact.
. CRM software can be used to improve customer service and increase competitiveness, because it stores information about existing and potential costumers.

31
Q

Ethical and socially responsible management of an operations system.

A

. Operations managers must be aware of socially responsible and ethical management when pursuing organisations objectives.
. Organisations that do so will benefit from improved organisational performance.

32
Q

What is socially responsible management?

A

the Obligations a business has which are over and above it’s legal responsibilities to the well being if employees and customers, shareholders and community as well as the environment.

. A socially responsible business will essentially attempt to achieve two goals simultaneously, being the expansion of the business alongside providing for the greater good of society.

33
Q

What is ethically responsible management?

A

refers to processes of abiding by moral standards and doing the ‘right’ thing in the interests of all stakeholders.

. therefore ethical management isn’t concerned with legal obligations but instead trying to definitively say what is ‘right’ and ‘wrong

34
Q

What aspects of ethics and social responsibility would concern an operations manager?

A

. the ones in inputs
. processes
. outputs

35
Q

Pros and cons to inventory.

A

CONS
. stock taking up storage space can mean org. misses opportunity to invest money elsewhere
. materials can have a use by date
PROS
. don’t have to rely on materials arriving constantly

35
Q

What is supply chain.

A

. A supply chain is a range of supplies from which the organisation purchases materials and resources.
. The supply chain moves on to storage facilities before reaching consumers.

35
Q

Ethics and social responsibility involved in inputs.

A

. procurement (supply of inputs) - ensure suppliers are ethical and socially responsible. Use of these practices may cost more and may require time and effort to investigate. (both)
. fair dealing with suppliers - prompt payment may cause cash flow prompts (ethics)
. local vs overseas supplier - local suppliers create more jobs etc. (social)
. overseas suppliers increase transportation internationally - rises in greenhouse gases, environmental costs (social)
. environmentally sustainable inputs (social)

36
Q

Ethics and social responsibility involved in processes.

A

. OH&S - improved outcomes for staff, less time lost through injuries, but can be cost,y through rewriting of procedures, providing safety equipment (social)
. training - benefits staff by upskilling, increasing motivation, but loss of time while employees are trained (social)
. efficient use of resources - minimising waste

36
Q

Ethics and social responsibility involved in outputs.

A

. create good products that provide value - fit for intended purpose and provide value for money
. packaging decisions - aim to minimise packaging to reduce environmental footprint while still considering perishable items and hygiene

37
Q

What are the different types of technology?

A

. office technology
. customer relationship management
. manufacturing technology

38
Q

What are the performance indicators used in the operations management function?

A

. efficiency
. level of waste
. productivity
. customer satisfaction as measured by number of repeat order
. customer satisfaction as measured by number of returned products
. profit

39
Q

Explain the following Performance indicator: efficiency

A

. This links in with lean manufacturing, as the best use of resources is an essential component of operations management

40
Q

Explain the following Performance indicator: level of waste

A

. This measures the amount of waste created by the production process.
. When an organisation manages resources more efficiently through reducing waste it can cut production costs.

41
Q

Explain the following Performance indicator: productivity

A

. If the inputs and processes are being managed well, then productivity levels should also improve

41
Q

Explain the following Performance indicator: costumer satisfaction as measure by the number of repeat orders

A

. If costumers are happy with the quality, delivery time and other aspects of the finished product, then they are more likely to continue to support the business by placing repeat orders.

41
Q

Explain the following Performance indicator: costumer satisfaction as measured by the number of returned products

A

. If costumers are constantly returning goods because they do not meet their expectations, then it is clear that the operations are not being effectively managed.

41
Q

Explain the following Performance indicator: profit

A

. If the firm is continuing to make profit then it may be a reflection of effectively managed operations in terms of maximising efficiency and productivity levels

. This is what remains when expenses are deducted from the revenue earned.
. An organisation that makes a profit is considered to have performed successfully
. and in turn low profit or negative profit (referred to as a loss) suggests that an organisation could be experiencing problems such as reduced sales, poor customer service or inadequate management of expenses.

42
Q

What technology can be used in manufacturing?

A

. Robotics - highly specialised form of technology that are capable of automated, complex tasks.
. Computer Aided Design (CAD) - software that creates product possibilities from a series of parameters (can be used to test a product before putting it into production).
. Computer Aided Manufacture (CAM) - software that designs and controls the manufacturing process.
. Computer Integrated Manufacturing (CIM) - methods where the entire manufacturing process if controlled by computer systems.

43
Q

What technology can be used in services?

A

. Customer Relationship Management - maintaining customer contact and tracking purchase history (eg. Membership cards)
. Videoconferencing
. Electronic Payment Systems (eg. EFTPOS, pay wave)
. E-commerce - ability for people purchase online
. Databases
. Social Media

Unit 3 & 4 Business Management (10 decks)

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