Making operations and production

Cards (40)

  • Operations
    Business function that organises , produces and delivers the goods and services produced or provided by a business . It is the key function that transforms resources into finished goods and services .
  • Production Process
    A business using its resources to produce goods and provide services that customers can buy .
  • Production method
    Business may use Job production , Batch production , Flow production depending on the nature of the product and the level of production .
  • Job production
    One - off or bespoke products
    Focus on customer needs and individual services
    Specialist skilled workforce increases costs
    High profit margins
    Longer production process
  • Batch production
    Larger volumes of products than job production
    Some flexibility
    Semi-skilled workforce
    Some-levels of automation
    Productivity reduced when switching between batches
  • Flow production
    High volumes and low margins Standardised production
    Low skilled workforce
    Highly automated process
    Setting up expensive machinery increases costs
  • Production and Competitive Advantage
    Operation is linked to productivity , flexibility , cost and quality . Eg If a business can provide custom products and services , this will make their products more desirable to customers . Similarly , controlling production costs can allow a business to lower prices or increase profit margins .
  • Technology used in business operations examples
    Computer aided design
    Supply change management
    Geographical positioning systems
    Electronic point of sale
    3D printing
    e-commerce
  • The impact of technology on operations
    Speeds up the production process
    Keeps businesses in touch with their customers
    Lowers production costs
    Ensures fewer mistakes and defects
    Can quickly become obsolete
    Requires employees to be trained to use new technology
  • Productivity
    Output per worker. It measures how much each worker produces over time. Increasing productivity leads to greater competitiveness in a market. Productivity can be improved by increasing output or by lowering the costs of production while maintaining output
  • Economies of scale
    Describes average costs of production falling while the volume of production increases . An advantage that the business gain as they grow in size
  • Factors affecting choice of technology
    Flexibility
    Quality
    Cost
    Productivity
  • Maximum stock level
    The most stock that a business can hold
  • re - order level
    The level of stock which new stock will be ordered by the business.The difference between this level and the point at which stock increases is the time it takes for the stock to arrive .
  • Minimum stock level
    Aka Buffer stock is the lowest amount of stock the business will hold. It is a safety net in case there is a surge in demand.
  • Just in time
    Stock management system where stock is delivered only when needed by production system. No stock is kept by a business . For JIT to work , a business must have a good relationship with suppliers , a well-organised production system , and regular demand for their products .
  • Benefits of holding stock
    Any unpredicted surges in demand can be met.
    Damaged goods can be replaced
    Businesses can receive discounts for bulk buying
    Limited risk of problems supplying customer demand
  • Benefits of holding little or no stock
    Cost saving in not having to store stock
    Less chance of damaged or stolen stock
    Employees can focus on tasks other than managing stock
    Can reduce costs of production, which makes product pricing more competitive
  • Working with suppliers
    A business may use one supplier or many suppliers .Suppliers are a key part of a business operation and finding right suppliers is crucial to a business's competitiveness and success . Loads of factors when choosing suppliers some factors may be more important due to nature of the products and business .
  • What makes a good supplier
    Good price on products and delivery
    Flexible deliveries
    Reliable deliveries
    Discounts for large orders
    High-quality supplies
    Availability of products
  • Suppliers and logistics
    Suppliers and logistics have a significant impact on the operations of a business . A business needs a supplier they can trust
  • Quality control

    Part of chain of production . A quality controller will examine and\or test for quality once a product has been made or a service has been delivered .
  • Quality assurance
    Focuses on quality at every stage of production process . Everyone is involved and is responsible for contributing to the achievement of a quality standard . As a result there should be zero defects .
  • Benefits of good quality
    Good quality allows for a premium price to be charged .
    Good quality builds a strong brand image .
    Good quality is closely linked to meeting customer needs and can help provide a competitive advantage.
    Quality is a way of differentiating a product
  • Quality assurance checklist
    Have quality as the focus of every process
    Involve customers and suppliers at the design stage.
    Aims for zero defects
    Have quality as the responsibility of every employee
    Have managers who ensure there are systems in place to assure quality.
    Meet a quality standard , such as 150 9000
    Make good quality part of the business's culture so it is something everyone aims for and is involved in.
  • Good customer service
    Satisfied and loyal customers
    Positive brand image and reputation
    Differentiated products with a competitive advantage
    Increased sales an repeat purchasing
  • Poor customer service
    Poor customer satisfaction and low customer loyalty.
    Poor brand image.
    Inability to differentiate products and to charge premium prices.
    Falling sales and repeat purchases
  • The sales process
    The sales process identifies the key stages of buying a product or service that contribute to customer satisfaction. This means that it is an important part of providing excellent customer service.
  • Factors affecting sales process
    Some products have a short sale process while others an extended sales process over a number of months. Business needs to manage each stage of process effectively to ensure the sale is complete and customers are satisfied
  • What the business need to consider depending on the product or service being sold?
    The product knowledge of its sales staff
    The speed and efficacy of its services
    Customer engagement with its products
    Its responses to customer feedback
    The post-sales service that it provides
  • Questions about 5 stages of sales process
    1.How can we grab the attention and interest of potential customers ?
    2.How can we ensure we respond to customer needs promptly ?
    3.How can we build relationships with customers and meet their needs ?
    4.How can we ensure that customers remain happy after buying our products ?
    5.How can we encourage customers to continue to buy and engage with our brand ?
  • 5 stages of sales process
    1. Customer interest
    2. speed and efficiency of service
    3. Customer engagement
    4. Post-sales service
    5. Customer loyalty
  • Production
    1.Design
    2.Manufacture
    3.Assembly
    4.Test
    5.Control
    6.Delivery
  • Business effects
  • Flexible suppliers can help a business meet customer needs more easily
  • The services provided by a supplier can directly influence the reputation of the business that uses its products
  • Late deliveries can hold up production
  • Securing good contracts and supplier agreements can help a business achieve economies of scale as it grows
  • Poor quality can lead to dissatisfied customers and products being returned
  • Using a supplier to deliver products directly to customers can be risky if they are not reliable