UNIT 5 - IB BUSINESS MANAGEMENT: OPERATIONS

• What is operations management?


  The management process of creating goods and services that people want to purchase.
• What are the inputs and outputs in operations management?


  Raw materials are the inputs, and finished products are the outputs.
• What are the factors of production?


  Land, labour, capital, and entrepreneurship.
• What does 'land' refer to in the context of factors of production?


  Natural resources needed to produce goods and services.
• How is 'labour' defined in the factors of production?


  Human effort used to produce goods and services.
• What does 'capital' mean in the context of production?


  Non-natural resources used in the production process.
• What is meant by 'entrepreneurship' in the factors of production?


  Knowledge, skills, and experiences of individuals who manage the production process.
• What is productivity?


  A measure of a firm's efficiency level in terms of how well things are done within the organization.
• What is a capital-intensive process?


  An operations process that has a high proportion of capital compared to labour.
• What is a labour-intensive process?


  An operations process that has a high proportion of labour compared to capital.
• What are the different production methods?

  • Job production
  • Batch production
  • Mass production
  • Mass customization
• What is job production?


  The production of a special one-off product made to a specific order.
• What types of products is job production associated with?

  High-end products, high quality, market-oriented firms, and products with originality.
• What are the advantages of job production?


  Client gets exactly what they want, motivates skilled workers, and is flexible.
• What are the disadvantages of job production?


  It is expensive, time-consuming, and labour-intensive.
• What is batch production?


  The manufacture of a group of identical products.
• What types of products is batch production associated with?

  Quality, affordability, and firms that are market-oriented.
• What are the advantages of batch production?


  More customer choice, achieves economies of scale, and helps deal with unexpected orders.
• What are the disadvantages of batch production?


  May lose production time when changing products, large amounts of stock, and batches dependent on machinery capacity.
• What is mass production?


  A process which involves the production of a high volume of identical standardized products.
• What are the advantages of mass production?


  Maintenance only, large orders, and lower labour costs.
• What are the disadvantages of mass production?

  Set up costs are high, machine breakdowns can be costly, can be demotivating for employees, and inflexible.
• What is mass customization?


  Large-scale mass production but with the flexibility to adapt to different customer needs and produce different models.
• What are the advantages of mass customization?


  Higher customer retention, higher price point, and higher profit.
• What are the disadvantages of mass customization?


  Wait time for delivery increases and increased costs.
• What factors should a business consider when deciding on a production method?


  • Target market and its size
  • State of technology
  • Availability of resources
  • Government regulations
• What factors should be considered when starting up or relocating a business?


  • Competition
  • Type of land
  • Markets
  • Labour pool
  • Infrastructure
  • Government
  • Costs
• What are the benefits of an optimal location for a business?


  Lower costs, closer to the customer, overcoming trade barriers, and may add to the brand image.
• Why do businesses need to consider where their competitors are located?

  To strategize their own location and competitive advantage.
• How does e-commerce relate to business location?


  1. commerce does not need to be close to customers.
• What is a labour pool?


  The type of labour a business needs to consider for its operations.
• What is infrastructure in the context of business location?


  Businesses should locate themselves close to the infrastructure they need.
• Why might some businesses locate close to their suppliers?


  To reduce transportation costs and improve supply chain efficiency.
• How does government affect business location decisions?

  Businesses may consider a country’s or region’s law and tax system.
• What are the qualitative factors affecting location decisions for businesses?


  • Cultural and language comfort
  • Attraction of successful hubs
  • Personal and image factors
• What are the ways of reorganizing production?

  • Outsourcing
  • Insourcing
  • Offshoring
  • Re-shoring
• What is outsourcing?


  Hiring a party outside a company to perform services or create goods.
• What is insourcing?


  Assignment of a project to a person or department instead of hiring an outside person or company.
• What is offshoring?


  Basing some of a company’s processes or services overseas to cut costs.
• What is re-shoring?


  Returning the production and manufacturing of goods back to the company’s original location.