Business Section 5 - Operations Management 1

  • Created by: ryyansb
  • Created on: 27-03-15 19:01


Businesses aim for efficient production

An efficient business will have lower operating costs

Job production - making one item at a time:

  • Used for if a firm manufactures individual products
  • Each product will have a unique design
  • Often high skilled labour is required
  • Expensive and take a long time to make
  • Examples are ships and aeroplanes

Batch production - making groups of identical products

  • Make same products at same time
  • When a batch is complete they reorganise and make a batch of something else
  • Suitable for products identical to each other but limited quantities
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New technology in the workplace

Computer software improves productivity

  • Computer aided design (CAD) can be used to create a three dimensional model and make instant changes to the design.
  • Computer aided manufacture (CAM) is more accurate than traditional methods

Computers reduce costs and increase efficiency

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Quality assurance

Customers expect quality from all parts of a business

Should be good quality for their price

Quality can depend on:

  • Materials the product is made from
  • Production method used to assemble product

Customers may need reassurance before they buy

  • Quality awards are evidence of high standards
  • Trade associations - membership of certain trade associations can certify the firm meets particular standards - have to abide my a code of practice
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Customer service

Customer service

  • Accurate product information - business should know products inside out and give honest  information
  • Reliability - products and customer service needs to be reliable
  • Dealing with customer concerns and questions - should be shown how the products work
  • Fulfilling the order requirements - send them the correct order
  • Delivering on time - deliver when you say you will do
  • After sales support and warranties - put all problems right
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Government policy

Government policy - consumer protection:

  • The product should be fit for purpose
    • Do the job it was designed for
  • The product should match it's description
    • Illegal for a retailer to give a false description of something
    • This includes size of quantity of the product
    • Illegal to say a product has been approved in less it has
  • The product should be of satisfactory quality
    • Product should be made well
    • Should not cause other problems for the buyer
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  • Costs less
  • Reach international markets

Benefits to consumers:

  • Shop at home at any time
  • Easy to compare prices between sites
  • Encryption software allows card details to be stored securely
  • Track the progress of an order

Problems for consumers:

  • Impossible to tell whether the site is trustworthy
  • Chance card details could be stolen
  • Products can't be seen before buying
  • Could be difficult to exchange goods or get money back
  • Customers receive a lot of direct e-mail

Websites can provide customer services but running a website can be expensive

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