Making Operational Decisions

• • Job production is making individual products uniquely
  • based on the customers wants
  • require highly skilled labour
  • would take a long time to make
• • batch flow is a mixture of job and flow production
  • used for producing identical products at limited quantities
  • expensive as you need more machinery
  • lower unit costs as supplies can be bought in bulk
  • so they can lower their prices
  • which makes them more competitive
• • flow production is making identical products continuosly
  • high productivity
  • requires a lot of space such as factories
  • requires a lot of machinery
  • low unit and competitive prices
• advances in technology create new ways of producing products which can be much cheaper and faster
• advantages of using technology in production:

  • it is quick
  • increases productivity
  • consistent quality
  • production would be continuous as machines can work all day
  • cheaper as no wages need to be paid if machines do the work
• disadvantages of using technology in production:

  • expensive
  • needs maintenance
  • staff need to be trained to know how to use machines
  • demotivate staff as their jobs might be at risk
  • inflexible as machines are set to do one task
• Just in Time Stock:

  • stock levels at the bare minimum
  • businesses buy in small quantities
• advantages of Just in Time:

  • reduces cost as you require less space and workers to manage stock
  • stock would be less likely to go out of date
• disadvantages of Just in Time:

  • requires a lot of coordination
  • can run out of stock with high demand
  • frequent deliveries needed
• procurement is the process of sourcing and buying goods from suppliers
• logistics means transporting goods from one part of the supply chain to another
• effective procurement and logistics improves efficiency and reduces costs, improves customer service and reduces waste
• factors to consider during procurement:

  • QUALITY = high quality needs to be consistent otherwise customers could buy from competitors
  • TRUST = if a supplier doesnt supply, businesses dont have anything to offer their customers; suppliers need to deliver high quality products on time
  • AVAILABILITY = make sure the supplier provides sufficient stock before it becomes out of stock and affects the businesses production process
  • DELIVERY = make sure how costly and quickly suppliers provide goods, so businesses would source suppliers who are nearby and reliable
• quality control and quality assurance are systems that check for high quality in products
• quality control:

  • checks at the end of the production process
  • this reduces waste
  • expensive
  • but reduces dissatisfied customers
• quality assurance:

  • checking after each stage of the production process
  • stops errors
  • less waste
• the sales process:

  • finding potential new customers
  • aproaching these customers
  • assessing their needs
  • present the product
  • close the deal
  • follow up after the sale to check they are satisfied
• how to provide great customer service

  • having excellent product knowledge so the most suitable product can be provided according to the customers needs and so that any questions can be answered quickly
  • engaging well with the customer by being polite and friendly so they feel valued
  • quick and effecient service
• post sales service offers help to customers after they have purchased the product
• responding to customer feedback is important because

  • it allows the business to improve its products and services
  • makes the customer feel valued
  • future customers will have a better experience
• benefits of good customer service:

  • high levels of customer satisfaction
  • which can lead to loyal customers
  • who will repeat purchases
• drawbacks of poor customer service:

  • dissatisfied customers
  • bad word of mouth
  • so poor brand image
  • leads to lower market share and sales