Business Operating Management Key Terms

Econoies of Scale: arise when unit costs fall as output increases

Minimum Efficent Scale: the output at which average unit costs of production are at their minimum

Internal: arise from the increased ouptut of the business itself

External: occur within an industry all competitors bennefit

Diseconomies of Scale: factors which cause the average production cost per unit of a business to increase above the efficent level

Labour Intensive: production relies on using laboiur resources

Captial Intensive: production relies on using capital resources

Innovation: pratical application of new inventions into marketable products/services

Production Innovation: launching new/improved products onto the market

Process Innovation: finding better/more efficent ways of producing existing products or delivering existing services

…