Unit 4 Key Terms Business A-Level

Operational management

The administration of business practices to create the highest level of efficiency possible within an organisation

Labour intensive

A process or industry that requires a large amount of labor to produce its goods or services

Capital intensive

Business processes or industries that require large amounts of investment to produce a good or service

Supply chain

The network of all the individuals, organisations, resources, activities and technology involved in the creation and sale of a product

Operations objective

A specific, measurable targets that a business sets for its day-to-day operations

Competitive advantage

Factors that allow a company to produce goods or services better or more cheaply than its rivals

Total costs

The combined sum of fixed and variable costs

Unit/average costs

Measures the average cost per unit produced, as measured over a particular time period

Capacity

The maximum output that a business can produce in a given period with the available resources

Capacity utilisation

A measure of the extent to which the productive capacity of a business is being used

Labour productivity

The measure of how much output is produced per unit of labour input

Efficiency

It measures how well a business uses its resources to make its products or provide its service

Lean production

It is an approach to management that focuses on cutting out waste, whilst ensuring quality

Quality

Meeting the needs and expectations of customers

Mass customisation

A business process of providing customised goods and services that best meet individual customer's needs

Inventory

The raw materials used to produce goods as well as the goods that are available for sale

Part time

An employee working for only part of the working week, or anything less than full time. They may work for two, three or four days a week

Temporary staff

Someone hired for a set period or to help with a large project when the business is shorthanded

Vertical integration

The business arrangement in which a company controls different stages along the supply chain

Corporate social responsibility

A concept within businesses whereby companies ensure the integration of social and environmental activities within their business operations for the good of society

Outsourcing

The business practice of hiring a party outside a company to perform services or create goods that were traditionally performed in-house by the company's own employees and staff