Business Operations Flashcards

All 17 cards in this deck

What is the purpose of business operations?

To convert resources such as raw materials, finance and the workforce into finished goods or services, delivered on time and to quality standards.

What is job production?

Making individual products one at a time to meet a specific customer's needs.

What is batch production?

Making one group of identical products at a time before switching to produce the next group.

What is flow production?

Continuously making identical, standardised products on an assembly line.

What is productivity?

The amount of output produced by a worker (or machine) in a given period of time.

Give two ways a business can increase its productivity.

Retraining employees; introducing new technology. (Also: investing in machinery, offering incentives.)

Give one benefit of flow production for a business's costs and prices.

It raises the rate of production, so the average cost of each unit falls and the business can cut its price to gain a competitive advantage.

Give one benefit to a business of using technology in production.

Machinery works faster than employees, raising productivity, so average variable cost per unit falls. (Also: products are more consistent in quality.)

Give one drawback of investing in machinery and technology for production.

High initial cost raises fixed costs, so the break-even point may rise and the investment is wasted if demand is not sustained.

True or false? Flow production is more flexible than job production.

False. Flow production makes a standardised product, so it is difficult to make different versions to meet individual customer needs.

What four factors must a business balance when choosing technology for production?

Cost, productivity, quality and flexibility. Improving one, such as productivity, can mean giving up some of another, such as quality.

Give one advantage of job production.

Any one of: each product is made to the customer's exact requirements; customers pay more for a one-off item, so profit margins are high.

Give one disadvantage of job production.

Any one of: it needs highly skilled workers, which raises labour costs; each item takes a long time to make, so output is low.

Give one advantage of batch production.

Any one of: the business can switch between versions of a product, such as sizes or flavours; it makes more units than job production, so unit costs are lower.

Give one disadvantage of batch production.

Machines must be stopped and reset or cleaned between batches, so no output is made during the changeover and productivity falls.

Give one drawback of using technology in production, other than its cost.

Any one of: it can soon become out of date and need replacing; employees must be trained to use it.

Give two examples of technology used in production.

Any two of: computer-aided design (CAD); robots or computer-controlled machinery (CAM); automated assembly lines; 3D printing.