Unit 5: Operations Management

Question 1

• definition of job/customized production
• advantages
• disadvantages
• use

Answer 1

• single one-off items, often to customers’ specific design
• ability to take on specialist projects or jobs with high value, high motivation
• high unit of cost production, time-consuming, labor-intensive
• art, special fashion, furniture designs, and construction projects

Question 2

• definition of batch production
• advantage
• disadvantage
• use

Answer 2

• groups of identical products pass through each stage of production together
• some economies of scale, fast production and lower unit costs than job production, some flexibility
• high levels of stock at each production stage, high unit costs than flow production, boring, and demotivating
• products with seasonal demands like ice cream or school uniform

Question 3

• definition of mass/flow process production
• advantages
• disadvantages
• use

Answer 3

• mass production of standardized products
• low unit costs due to constant working of machines, high labor, and economy of scale, high quality, and consistent
• inflexible (difficult to switch from one product to the other), expensive machinery, work is boring, demotivating and repetitive
• mass-market cars and electronics

Question 4

• definition of cellular manufacturing
• advantage
• disadvantage
• use

Answer 4

• team-based production of components or complete products
• more flexibility because of multi-skilled workers, high motivation, low handling costs since the equipment is in close proximity, and time is saved during production
• output may not be as high as traditional “flow” production, different cells working at different speeds, investment in new machinery, high employee training costs
• a variety of different applications, requiring different specifications

Question 5

outsourcing

Answer 5

using another business to undertake a part of the production process rather than doing it within the business using the firm’s own employees

Question 6

subcontracting

Answer 6

the practice of assigning to another business part of a contract, for example, a specialist activity that makes up part of a construction contract

Question 7

offshoring

Answer 7

the relocation of a business process done in one country to the same or another company in another country

Question 8

insourcing

Answer 8

the reverse of outsourcing as it is undertaking a business function or process within the business rather than contracting it to another business

Question 9

Quantitative factors

Answer 9

• site & other capital costs such as builidjng or shop-fitting costs
• labour costs
• transport costs
• market potential
• government grants

(Sara Likes To Make Glue)

Question 10

Qualitative Factors

Answer 10

• safety
• room for further expansion
• managers’ preferences
• labour supply
• ethical considerations
• environmental concerns
• infrastructure

(Sara’s Room Makes Lots of Ears & Eyes Itchy)