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Business - Unit 4 (Efficiency (Increasing Labour Productivity (Methods:
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Business - Unit 4
Efficiency
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Technology
Benefits:
- reduce human error
- improve customer experience
- get more from workforce
Problems:
- expensive to install
- regular maintanance
- updated regularly
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Lean Production
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Can reduce waste by:
- improving quality
- reducing inventory
- reducing time items are waiting and moving
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Improving Quality
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TQM - Total Quality Management - Seeks to improve quality by ongoing refinements in response to continuous feedback
Benefits of Improving Quality:
- process is under control
- customer satisfaction
- remain competitive
- gain loyal customers
Consequences of Poor Quality:
- costs money to recall products
- can damage brand's reputation
- costs money to rework faulty items
- may be legal costs if customers sue
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Managing Inventory
Inventory Control Charts:
- buffer inventory
- lead time
- re-order level
- re-order quantities
- maximum stock
- minimum stock
Influences on amount of stock held:
- amount of resources
- opportunity cost
- may go out of date
How to match supply to demand:
- flexible workforce
-queuing systems
- outsource production
- increase prices
- accept orders
- produce to order
Just-In-Time
Benefits:
- easier to swap product to meet customer demand
- reduce holding cost
- less inventory damage
- damages spotted quickly
Drawbacks:
- disrupted production from non arrivals
- danger of loss of demand
- high dependence on supplier
- high investment in tracking technology
Operational Objectives
- Quality
- Speed of response
- Costs
- Dependability
- Flexibility