Business Management Chapter 3 Definitions (FInal)

Operations management:

Involves coordinating and organising the activities involved in producing the goods or services that a business sells to customers.

Efficiency:

How productively a business uses its resources when producing a good or service.

Effectiveness:

The extent to which a business achieves its stated objectives.

Define Inputs:

The resources used by a business to produce goods and services.

Define Processes:

The actions performed by a business to transform inputs into outputs.

Define Outputs:

The final goods or services produced as a result of a business’s operations system, that are delivered or provided to customers.

Manufacturing businesses:

Use resources and raw materials to produce a finished physical good.

Service businesses:

Provide intangible products, usually with the use of specialised expertise.

Automated production lines:

Involve machinery and equipment that are arranged in a sequence, and the product is developed as it proceeds through each step.

Robotics:

Are programmable machines that are capable of performing specified tasks

Computer-aided design (CAD):

A digital design software that aids the creation, modification, and optimisation of a design and the design process.

Computer-aided manufacturing (CAM) techniques:

Involve the use of software that controls and directs production processes by coordinating machinery and equipment through a computer.

Artificial intelligence (AI):

Involves using computerised systems to simulate human intelligence and mimic human behaviour.

Online services:

Are services that are provided via the internet.

Forecasting:

A materials planning tool that predicts customer demand for an upcoming period using past data and market trends.

A master production schedule (MPS):

A plan that outlines what a business intends to produce, in specific quantities, within a set period of time.

Materials requirement planning (MRP):

A process that itemises the types and quantities of materials required to meet production targets set out in the master production schedule.

Just in Time (JIT):

An inventory control approach that delivers the correct type and quantity of materials as soon as they are needed for production.

Quality:

Is a good or service’s ability to satisfy a customer’s need.

Quality control:

Involves inspecting a product at various stages of the production process, to ensure it meets designated standards, and discarding those that are unsatisfactory.

Quality assurance:

Involves a business achieving a certified standard of quality in its production after an independent body assesses its operations system.

Total Quality Management (TQM):

A holistic approach whereby all employees are committed to continuously improving the business’s operations system to enhance quality for customers.

Waste minimisation:

The process of reducing the amount of unused material, time, or labour within a business.

Reduce:

A waste minimisation strategy that aims to decrease the amount of resources, labour, or time discarded during production.

Reuse:

A waste minimisation strategy that aims to make use of items which would have otherwise been discarded.

Recycle:

A waste minimisation strategy that aims to transform items which would have otherwise been discarded.

Lean management:

The process of systematically reducing waste in all areas of a business’s operations system whilst simultaneously improving customer value.

Pull:

A lean management strategy that involves customers determining the number of products a business should produce for sale.

One-piece flow:

A lean management strategy that involves processing a product individually through a stage of production and passing it onto the next stage of production before processing the next product, continuing this process throughout all stages of production.

Takt:

A lean management strategy that involves synchronising the steps of a business’s operations system to meet customer demand.

Zero Defects

A lean management strategy that involves a business preventing errors from occurring in the operations system by ensuring there is an ongoing attitude of maintaining a high standard of quality for the final output.

Corporate social responsibility (CSR):

Is the ethical conduct of a business beyond legal obligations, and the consideration of social, economic, and environmental impacts when making business decisions.

Global sourcing of inputs:

Involves a business acquiring raw materials and resources from overseas suppliers.

Overseas manufacture:

Involves a business producing goods outside of the country where its headquarters are located.

Global outsourcing:

Involves transferring specific business activities to an external business in an overseas country.