Business Studies - Operations management - Questions

What does 'division of labour' mean?

Dividing up employees and getting each of them to do a specific job.

Why does division of labour lead to more efficiency?

The employee doing the specific job because specialised at it. Because they are doing it repeatedly and it is the only job they are doing, they become better at it as they have lots of practise. As the employee gets better at the job, this means they can complete the job quicker and to higher quality, which will increase quality therefore increasing customer satisfaction. 

Describe three problems with division of labour.

If the employee is doing the same job continuously, they may get bored doing the same repetitive job which will lead to a decrease in motivation and in the long run even lead to higher labour turnover.

The employee will become specialised with that one job, this means it is harder to deal with absences, if an employee who does a different job is absent, someone else could have to do their job and they may not know what to do.

Workers can become over-specialised - they might have difficulty finding another job if their skills are no longer in demand. Unemployment due to occupational immobility may result.

Explain how specialisation makes firms interdependent.

When firms become specialised in something, other firms rely on them. For example, the retailer will rely on the distribution company to deliver the products. If there is a delay with the distribution company then the retailer will also suffer as they have not got the products when they want them. 

Explain how a business may be able to introduce more efficient production methods as it grows.

As the business grows, there will be more demand for their products, which means they will have to produce them on a larger and more efficient scale. Therefore, instead of making their products in batches, which can be time-consuming, they could introduce a production method such as flow production. Flow production is making lots of products continuously. This means there a continuous line of products being made which will be very time efficient. 

What are the main features of flow production?

Flow production is producing lots of products continuously, there are usually not stoppages. Staff may work 24 hours a day in different shifts.

Flow production gains economies of scale and produce at minimum unit cost ti allow competitive prices. 

Modern flow production techniques use robots, not people, to do most of the work. 

Flow production is highly capital intensive (it needs a lot of money up front - e.g. to buy machinery.)

It is usually used for mass-market products.

Flow production is also sometimes called mass production.

What are the main features of flow production?

Flow production is producing lots of products continuously, there are usually not stoppages. Staff may work 24 hours a day in different shifts.

Flow production gains economies of scale and produce at minimum unit cost ti allow competitive prices. 

Modern flow production techniques use robots, not people, to do most of the work. 

Flow production is highly capital intensive (it needs a lot of money up front - e.g. to buy machinery.)

It is usually used for mass-market products.

Flow production is also sometimes called mass production.

What type of products are usually manufactured using flow production? Why?

Mass-market products. For example, chocolate bars. Because there products are made on a large scale and the best method of production for this flow production as you can produce a lot of products quickly. Products are also identical. 

What does lean production aim to eliminate?
a) Wasted raw materials b) fatty foods c) workers standing upright

a) wasted raw materials

Describe the differences between Just-in-Time (JIT) and Just-in-Case (JIC) stock control. 

JIC stock control has buffer stocks at every process of productions - from raw materials to finished products - just in case they run out of stock. The idea is that even if there's a problem with deliveries of any raw materials, the buffer stocks will mean there can still be continuous production. JIT is when the firm aims to have the minimum amount of stock available - ideally zero. Therefore, the raw materials are set to arrive immediately before they are used, and just the right amount is ordered. This means it decreases costs of warehouse space and less warehouse staff are needed. The differences between JIT and JIC is that JIT aims to have a minimum amount of stock whereas and preferably would have no stock JIC always makes sure it has some stock there. The problem with JIC is that they may be left with big stockpiles of items. A problem with JIT is that staff may become stressed if there are always on the verge of running out of stock.