Increasing Efficiency and Productivity

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  • Created by: BenHyde_
  • Created on: 08-05-16 15:18
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  • Increasing Efficiency & Productivity
    • Labour Productivity
      • Output per period/no. of employees
        • Higher the productivity, the better
      • it influences efficiency
      • How to improve
        • Improving motivation, bonuses
        • Training
        • Technology can improve speed
    • Lean Production methods increase efficiency
      • Keeps waste to a minimum
        • Inefficient methods increase costs
        • It helps achieve operational aims, reducing costs
      • Methods such as JIT production and time based management
    • JIT production
      • Aims to reduce waste by having as little stock possible
        • Raw materials come in through one door and go out the other, all in time for customers
      • Efficient stock control
        • Kanban is JIT system of triggering repeat orders, when they reach a certain amount of stock  they re-order
      • Advantages
        • Storage Costs reduced
        • Cash flow improved
        • Less waste as there's less out of date or damaged stock
        • Businesses can cope with changes in demand
      • Disadvantage
        • Customers can't be supplied during strikes
        • Suppliers have to be reliable because there isn't much stock to keep going
    • Time based management
      • Aims to reduce wasted time
      • They van then compete on time as well as prices
      • Companies have to be flexible
      • Communication is essential, there needs to be trust and workers need to be skilled, training is important
      • Advantages
        • Reduces lead time, time of order and time of delivery, cost of holding stock falls
          • Customer will be happier
        • drives innovation by decreasing R&D time
      • Disadvantage
        • Some may put speed over quality

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