Unit 4 Operations Management

Operations management

Involves overseeing, designing, and controlling the processes used in the production and delivery of goods and services within an organization.

Economies of scale

Refers to the cost advantages that a business can achieve by increasing its scale of production, leading to lower average costs per unit produced.

Sustainability

The ability to maintain or endure without causing depletion of natural resources or harm to the environment, economy, or society, meeting the needs of the present without compromising the ability of future generations to meet their own needs.

Economic sustainability

Focuses on ensuring that economic activities are conducted in a manner that promotes long-term viability, growth, and prosperity without depleting resources or causing harm to the economy.

Social sustainability

Involves fostering a society that promotes equality, diversity, justice, and well-being for all its members, both present and future.

Ecological sustainability

Aims to maintain the health and balance of ecosystems, preserving biodiversity and natural resources for the long term.

Production methods

Refers to the techniques and processes used to manufacture goods or deliver services.

Job (customized) production

Involves the creation of custom-made products or services tailored to meet the specific requirements of individual customers.

Batch production

Involves producing goods in batches or groups, where each batch goes through the whole production process together.

Flow production

Involves a continuous and sequential flow of materials and components through the production process, often in a highly automated manner.

Mass production

The manufacturing of large quantities of standardized products, often using assembly lines and specialized machinery to achieve high volume and efficiency.

Labor intensive

Refers to production processes that require a significant amount of human labor relative to other inputs such as capital or technology.

Capital intensive

Refers to production processes that rely heavily on machinery, equipment, and other capital assets rather than human labor.

Outsourcing

Involves contracting out certain business functions or processes to external third-party providers rather than handling them in-house.

Offshoring

Specific form of outsourcing where the outsourced business functions or processes are relocated to a foreign country, often to take advantage of lower labor costs or other benefits.

Production planning

Involves determining the resources, materials, and processes needed to manufacture goods or deliver services efficiently and effectively.

Supply chain

Encompasses all the activities, organizations, people, resources, and technologies involved in the creation and delivery of a product or service from suppliers to customers.

Logistics

Involves the management of the flow of goods, information, and resources between the point of origin and the point of consumption to meet customer requirements.

Distribution channels

The pathways or routes through which goods or services move from the producer to the end consumer, including wholesalers, retailers, and other intermediaries.

Inventory control

The process of managing and regulating the flow of goods or materials in and out of an inventory to ensure optimal levels are maintained to meet customer demand.