section 10
- Created by: saalim1970
- Created on: 25-05-16 20:38
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- operations management 2
- rationalisation is about improving efficiency by reducing overhead costs
- this can be done by
- closing an administrative department and delegating their work somewhere else.
- closing a factory and moving the production to another site
- reducing the number of mangers
- this can be done by
- economies of scale
- External
- Moving closer to suppliers
- moving closer to customers
- moving in area where a grant is available
- moving into a area where demand for the product is high
- Internal
- finance economies of scale
- marketing economies of scale
- managerial economies of scale
- purchasing economies
- Untitled
- diseconomies of scale
- decisions would take a long time to reach the hole work force this would slow down everything.
- the task might become to complex to mange this would mean that different departments might be doing similar things without realising
- External
- rationalisation is about improving efficiency by reducing overhead costs
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