Using and managing resources Flashcards
What is transformation?
Where a set of inputs, such as raw materials, is turned into outputs, such as finished goods
What is job production?
When just one product is produced using skills
What is batch production?
Producing different groups of a core product from similar inputs
What is flow production?
A product being assembled, processed or built as it moves along a production line
Define process production
Where a product is made through a process, such as refining or baking
What is division of labour?
Dividing work (and workers) up to specialise on a particular task
Define specialisation
When a worker concentrates on a particular task and becomes highly skilled at it
Define unique selling point
The factor that only your business or product has which makes it stand out
Define adding value
Making a product worth more to a customer; value is added at each stage of production
Define lean production
Minimising the use of all the inputs necessary for production
What is just-in-time production?
A version of lean production where materials, components, etc. arrive just as they are needed
Define quality (to a business)
A product that is up to standard
Define quality (to a customer)
A product that does what it should do
Define the Japanese idea of kaizen
Continuous (often small) improvement
What is the Kitemark?
The logo that shows that the product is BSI (British Standards Institute) tested and approved
Define revenue
The income of the business from sales
Define fixed costs
The costs that do not vary with production, like rent
What are variable costs?
The costs that do vary with production, like raw materials
Define average cost
The cost for each unit of production made by a business
Define productivity
The efficiency of resources; more productivity means more product from the same inputs
What are the economies of scale?
Benefits gained from the growth of a business
Define bulk
A large amount
Define breakeven
Where costs equal revenue and the business is making neither a profit nor a loss
What are the advantages and disadvantages of job production?
Advantages:
Product usually high quality
Producer meets individual customer needs
Greater job satisfaction – involved in all stages of production
Disadvantages:
Cost of producing one unit or job is higher
Labour –intensive
Requires investment in skills and training
What are the advantages and disadvantages of batch production?
Advantages:
Making in batches reduces unit costs
Can still address specific customer needs
Use of specialist machinery & skills can increase output and productivity
Disadvantages:
Time lost switching between batches – machinery may need to be reset
Need to keep stocks of raw materials
What are the advantages and disadvantages of flow production?
Advantages:
Flow production is capital intensive
High number of products can roll off assembly lines at very low cost
Production can continue at night and over weekends
Firms can benefit from economies of scale, which should lower the cost per unit of production
Disadvantages:
Machinery is very difficult to alter the production process
Production inflexible so all products have to be very similar or standardised and cannot be tailored to individual tastes
Flow production is that the work can be pretty boring for employees involved
What are the advantages and disadvantages of process production?
Advantages:
Processes can normally be automated which reduces unit costs
Large quantities can be produced
Ideal for products which have to be of a consistent quality
Disadvantages:
Heavy investment required in process design and production equipment / facilities
Difficult and disruptive if the production process has to be stopped
Little opportunity to make different versions of the product
