Term
| Q: What three things must operations managers be concerned with? |
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Definition
| A: Efficiency of production; quality; and flexibility |
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Term
| Q: What are the inputs of the production process? |
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Definition
| A: Resources; land; capital; and labor |
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Term
| Q: What is the definition of added value? |
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Definition
| A: The difference between the cost of purchasing raw materials and the price the finished goods are sold for |
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Term
| Q: What are the outputs of the production process? |
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Definition
| A: Finished goods; services; and components for other firms |
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Term
Q: How do you measure productivity (labor and capital)?
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Definition
| A: labor productivity (# of units per worker) = total output in a given time period/total workers employed; Capital productivity = output/capital employed |
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Term
| Q: What is the difference between being labor vs. capital intensive? |
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Definition
| A: Labor intensive involves a high level of labor input compared with capital equipment; Capital intensive involves a high quality of capital equipment compared with labor input |
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Term
| Q: What is the difference between efficiency and effectiveness? |
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Definition
| A: Efficiency is producing output at the highest ratio of output to input; Effectiveness is meeting the objectives of the enterprise by using inputs productively to meet customers' needs |
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Term
| Q: What are the four main ways to increase productivity levels? |
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Definition
| A: improve the training of staff to raise skill levels; improve worker motivation; purchase more technologically advanced equipment; and more efficient management |
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Term
| Q: What four stages are involved in the operations process before physically selling the good or service? |
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Definition
| A: Converting a consumer need into a product that can be produced efficiently; organizing operations so that production is carried out efficiently; deciding on suitable production methods; and setting quality standards and checking they are maintained |
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Term
Q: What are the factors that the degree of added value depends on? |
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Definition
| A: The design of the product; the efficiency with which the input resources are combined and managed; and the impact of the promotional strategy on convincing consumers to pay more for the product than the cost of the units. |
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Term
| Q: Is raising productivity always the answer(5 reasons why)? |
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Definition
| A: Does not guarantee business success; could lead to much higher wage demands; may result in unemployment; the quality of management will determine the success of a policy that aims to increase productivity; and there is a difference between efficiency and effectiveness |
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Term
| Q: In order to determine whether production is capital or labor intensive, what are three factors this depends on? |
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Definition
| A: The nature of the product and the product image that the firm wishes to establish; the relative prices of the two inputs; and the size of the firm and its ability to afford expensive capital equipment |
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