Unit 4.1- setting operational objectives Flashcards
What is operations management?
involves managing the process of converting inputs into outputs. It transforms resources into goods and services.
What are some operational objectives?
- Level of output a business needs to be able to produce
- The range of products a business wants to offer, the level of customer service to provide and how flexible a business wants to be for customer demands
- How best to produce the good or service
- How best to provide the good or service to the customer
- How much of the process managers want the business to provide themselves and how they want to use suppliers
What is labour intensive?
a higher proportion of labour is being used compared to capital equipment.
What is capital intensive?
a higher proportion of capital equipment is being used compared to labour.
What is the supply chain?
the series of activities involved in taking the initial resources to providing the final product
What are the stages of the operations process?
- Raw materials
- Manufacturing
- Transportation
- Retail
- Disposal/recycling
How can you add value?
- Developing raw materials into a finished product
- Good service
- Guarantees
- Packaging
- brand image
How to categorise operations? (4 v’s)
Variability
visibility
volume
variety
What occurs if variety of output is high?
- Flexible
- Quite complex operations to manage
- High unit cost
- Can meet customer needs precisely
What occurs if variety of output is low?
- Routine operations
- Standardised processes
- Low unit cost
What occurs if visibility of production is low?
- Limited customer service skills
- Time lag between production and consumption
What occurs if visibility of production is high?
- Good customer service skills needed
- Flexible in terms of information and communications to customer
What occurs if Variability of demand is high?
- Changing levels of capacity utilisation
- Need to try and predict demand
- Need flexibility
What occurs if Variability of demand is low?
- Stable
- Routine
- Predictable
- High capacity utilisation
What occurs if Volume of output is low?
- Likely to be high unit costs
- Employees likely to be multi skilled
- Little repetition of tasks
What are the stages of the operational decision making process?
- Identifying the operations objectives
- Analysing the existing position of the business
- Choosing what actions need to be taken
- Implementing the decisions
- Reviewing the decisions
How can ethics and the environment affect operational decisions?
- Treatment of employees
- Location factors
- Safety
- Environment
What affects setting operational objectives?
- Costs
- Quality
- Flexibility
- Speed
- dependability
What is competitive advantage?
in which a business offers superior value to its competitors.
What is the importance of different operational objectives?
- Product
- Target market
- Competitive strategy
- Competitors
How does political factors affect operations?
greater legal regulation and concerns over health and safety.
How does economic factors affect operations?
Greater globalisation enables businesses to source supplies more easily from countries
How does social factors affect operations?
There is now greater demand for choice and variety.
How does technological factors affect operations?
As technology has improved and keeps improving, it is quicker to develop, test and launch new products
