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Business .k > UNIT 4 OPERATIONS - INCREASING EFFICIENCY AND PRODUCTIVITY > Flashcards

UNIT 4 OPERATIONS - INCREASING EFFICIENCY AND PRODUCTIVITY Flashcards

1
Q

INCREASINg opperational efficiency is all about

A

getting mroe ouptu from a given level of resources

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2
Q

if operatioal efficiency can be achieved what happens to unit costs

A

they fall

and you know the drill

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3
Q

uni costs declines as a capacity utilisation icnreases

t/f

A

true

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4
Q

as unit costs decrease when capacity utilisation increases its important a bs dont have too much

A

excess capapcity

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5
Q

what is excess capacity

A

when actual production falls below max production

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6
Q

if we have excess capcity resources arent being used

A

efficiently

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7
Q

operating at amx apapcity creates it sown problems why

3 points

A

reduces flexibility int erms of new orders

puts undue pressure o workers

put undue presure on machinery if proper maintainenace cant be undertaken

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8
Q

what is an optimal level of capacity

A

close to 100% as posssible while leaving sufficient spare capacity to cope with new orders

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9
Q

optimal elvel of acpapcity in agrowing market needs to be planned

A

carefully

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10
Q

when making a judgement/eval a bs capapcity utilisation what is importnat

A

compare with capcit utilisation in previous years

industry avergae

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11
Q

increasing capacity utilisaiotn is better but not

A

always

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12
Q

sum up beneffits of high capacity utilisation

3 points

A

more efificney
important for high fixe costs
reduces inot costs

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13
Q

explain +ve of capcity utilisatio in terms of more efficieny

A

more efificnet

as more resources used

therefore less waste

this is beenficial for saving osts

make consumers happy as less being wasted

and lowers unit costs

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14
Q

why is high capcity utilisation important for a busines with high fixed csots

A

they need to increase ouptut to keep unit costs lower q

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15
Q

why is hihg capacity utilisation important in terms of beenfits of lo unit costs

A

as a result of being more efificent we get lower unit costs

we can decrease prices

and increase demand for goods in a comp mkt - if price elastic

as lower price - more rev

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16
Q

sum up negatoves of hihg cpacity utilisation

4

A

undue stress on workers and machines - lead to demotivated/ less well run machines

people may be doing things way to quick

miantiannng machines/equipmtn is hard

increase sproblems if deamnd spikes high

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17
Q

in terms of -ve og high capacity utilisiation why is pepole/mahcines doing thigns to quick bad

A

can reduce quality
in long term can create -ve rep , decreae brand loyalty and increase elastiicty

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18
Q

why from hihg cap utilisation do we get problems if deamnd spieks

A

since already nealry at max - may not be able to fulfill

result in missed opportunity and bs seen as unrealiable (Fail to meet op obj

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19
Q

-ve of low cap utilisation

A

less resources used

affects other departments

run risk of not being ablr to meet deamdn wehn high

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20
Q

whats the problem of less resources being used int erms of capacity utilisation

A

if less are used this reduces our efficiency
and increases our overall avg unit costs

which can lead to us increasing prices and being less comp as a result

eval depends on elasticity

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21
Q

how can low cap u affect mkting for a hotel

A

low cap dont lok good for marketing and rep

cuz when customers come think why no one else here

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22
Q

how can low cap u affect hr for a dpt

A

they can be demotivated as theres not lots to do
little drive to over achieve

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23
Q

why does low cap u run the risk of not being able to meet demand when high

A

wf may not be used to this high level

they may not be able to perform under pressure

so bs cant meet demadn

missed opportunity

run risk of being unrelaiabl

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24
Q

what are +Ve of capacity utilisatoin

A

time available to do necessarty aminatianeance of machines

spare capapcity

possibly improve quality

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25
Q

how can in terms of low cap u time avaiable to do necessary maintaineeance of machines be a positive

A

means can use them for longer and dont have to replace machines constantly

reducing LR costs for the business

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26
Q

why is spare cappcity a postiive of lower cap u

A

can cope with unexpected demadn
can adjst quick 2 trends if got more space

27
Q

how can low ca utilisation imporve quality

A

not rushed so have more time during production

can implement quality assurance and quality control

labour have more space and time to train on job ??

28
Q

if ew have stable demadn throught the year and dont need excess demand we can get rid of it this will lead to

A

increased capacity utilisairon

29
Q

how can we sell of excess capcity

A

RATIONALISATION

30
Q

Whats rationalisation

A

increasing efficiency by reducing scae

31
Q

how can we reduce scale

A

redundancies

selling assets

32
Q

selling spare capacity reduce our ovrall x but leads to hgiher

A

capacity

higher efificneyc

33
Q

why is labour productivity importnat

A

increeaing it leads to reduction in unict costs of production

biggest cost of abs - 70%

so increasing it can lead to more comp prices

34
Q

what factors ingluencing labourproductivity

A

hours employee works
making change 2 key bs processes
purchasing new tech or equipment
increasing training

35
Q

how does number of hour worked infleunce labour productivity

A

employees rareky choose to do more so theres a limt of what they cn create

36
Q

how does making key changes to bs process impact labour prodcutivity

A

maybe reluctant to learn whihc decreasig their motivaiton and therefore productivity

/may not like it and show resitance

37
Q

hwo does purchasing new tech . equipment influence LP

A

may decrease it as may be a threat to their jobs q

38
Q

how does incresaing training influecne LP

A

increases prodcutivity as got more skills or better able to improve their skills

39
Q

why woudl increasing triangnbe counter productive to oeprations

A

if wanna keep costs low

40
Q

what is efficieny

A

production maximised based on a given set o FOP

41
Q

how is labour productivity related to efificney

A

looks at efficiency of labour

42
Q

why is efffiicnecy important

A

if able to max production from a given level of FOP

you can reduce AUC

43
Q

in terms of reducing auc from efficiency why is it important - selling price

A

can reduce selling price

this can icnrease demand and therfore sales

this increases rev if price elatic

makes bs more price competitive

44
Q

in terms of reducing auc from efificeny why is it important - maintain SP

A

sdduming demand is the same increase prodit maargin which increases profit

45
Q

what can we do with our efficinecy gai of lower UC

A

invest into higher quality , creates hgiher rep of bs and bran this means increases added value

knock on eeffects of custoemr retention /brand loyalrt

or we can increase wages which increases motivation and therfore increase labour productivity which reduce sUC al over again

46
Q

what methods can we use to increase labour productivity

4

A

investmetn in technology

improvements in training and motivatio

job redesign

reduction in labour force

47
Q

how does investment in tech increase efficieny and labour productivity

A

improves wualitya nd reliabilty of a product

result in greater output from fewer eemployees

48
Q

imprtovements in trianng and motivation - what is the aim of trainig

A

improve skills of workforce

49
Q

imprtovements in trianng and motivation - the aim of trinaig is to iprove skils of workdirce how does this increase efficiency and labour productiivyt

A

leads to greater output

50
Q

improvements in training and motivation - how does trianign impact motivatino

A

if triang involves employees feeling more involvd in process cna lead to greater motivarion

motivated as pefrom taks better
being more trinaed cna cause you to have a winning mindset

and firther imporvememtn in both quality and output

51
Q

hwo does labour trinaing increease quality of a product

A

more skilled therfore less liekly to have defects and waste lead to less costs tha ususal from waste

+

higher quality products

52
Q

we can also imporve laobour productivity thoguh

A

having a differnt maangment styles e,.g laissez faire

53
Q

explain how job redesign may increase labour productivity

A

invovles changing content of job in terms of duties and repsosbilbities

may be done in a way that impotves overall pefomance of employee

54
Q

how does reduction in labour force ipmorve productivity

A

automatically improves labour productivity

if same level of ouptu can be maintained

may be achieved through investment in tech or better trianig

55
Q

its important to recognise imporvemnts in productivity shoudl come without

A

redcutino in quality or dependability of a service

56
Q

what are the drawbacks of increasing labour prodiuctiivyt through trianig

A

costly may offset lower unit cost gains form increased labour productivity
i

icnreased LP may result in worker sasking for hgiher wages - whic furthe rincreases costs

taining can cause resitance and tension in workplace as likely to be used to old ways

57
Q

even though labour productivity can result in highe rcosts and higher wages - waht is the long rn impact

A

imporvemtn in productivity may lead to greater competitiveness and greater sales

which may in the long run cover the costs

58
Q

when can lbour productivity be achieved at expense of quality

A

workers encourage dto produce more through financial incentivies e.g peice rate system

59
Q

why may some employees resit change when tryan increase LP

A

job losses and job security is threatedned

e.g intro of tech

so bs need to consider carefully how its introduced

60
Q

efforts to imporve productivity can impact motivation positivley or engatovley this depens on

A

communication

managment style
busienss culture

61
Q

shold we take a long term or short temr approach to imporing productiivyt

A

it depedns

62
Q

what ar teh short term way to imporve effiicneyc and prodcutivity

A

job redesign
reducing labour force

63
Q

what are eh long term ways to imporve productivit and efficinecy

A

investmetn in tech
imporvemetns in triang and workforce

Business .k (22 decks)

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