Operations Management Flashcards

Flashcards covering key vocabulary and concepts from the Operations Management lecture notes.

Operations Management

The administration of business practices to create the highest degree of efficiency possible within an enterprise.

Capacity planning

Evaluating the number of products or services a business can sell or distribute in a given time frame.

Quality control

Checking for potential problems or errors in services or products at every stage of the production process.

Process improvement and optimization

Evaluating and improving the steps in a process for optimal efficiency.

Supply chain management

Controlling the sourcing of supplies, production, inventory, sales, and distribution.

Facilities Management

Integrates people, places, and processes, as well as the handling and care of structures, buildings, equipment, and other physical necessities of a business.

Assets

Properties owned by an enterprise regarded as having a value that can be used to support the production of goods and services.

Hard services

Relate to any physical alterations and adjustments in the building or its structure.

Soft services

Responsible for making the workplace bearable and comfortable.

Facility location

Learning a geographic site for an enterprise’s operations.

Tangible factors (facility location)

Includes delivery or freight rates, production costs, and local government tax cuts.

Non-tangible factors (facility location)

Include the location’s security, quality of work, and culture.

Open Office Design

Workstations are arranged in various ways, some touching each other and others clustered in work zones of varying sizes.

Cellular Office Design

The entire office space is divided into individual spaces or cubicles.

Co-Working Office Design

Popular with workers without a designated workspace.

Combination Office Design

A combination office layout might be the best choice to incorporate open and mobile work options.

Product or line layout

A single product type is created in an operating area.

Process or functional layout

Machinery and equipment are positioned according to the nature or type of operations.

Fixed position layout

The major component of a product remains in a fixed position or location.

Combination type of layout

A layout that utilizes a combination or a mix of other layouts.

Virtual office

Considers an expansion in efficiency, a decrease in driving expenses and greater adaptability.

5S

A system of organizing workspaces to perform work efficiently, effectively, and safely.

Seiri

Sorting - Organize the important tools and materials needed for work and discard the ones not needed.

Seiton

Set in order - Arrange tools and materials so that few movements will be needed to locate them.

Seiso

Cleanliness or shine - Cleaning the workplace should be a daily habit.

Seiketsu

Standardized - Maintaining and following the first three “Ss” of the 5S system; assigning employees regular tasks.

Shitsuke

Discipline or sustain - The 5S method is an ongoing process and a continuing responsibility.

Business Model Canvas

A plan that outlines a company's financial goals; explains who your customer base is, how a business provides value to them, and the specifics of financing.

Customer Segment

The various groups of people or organizations that an enterprise aims to reach and serve.

Customer Relationship

Relationships can be personal or automated, transactional or long-term; the goal can be to get new customers, keep existing ones, or increase sales.

Channels

Ways a company reaches out to specific customer groups.

Revenue Streams

Where a business can verify the business model's profitability.

Key Activities

A business must take these most crucial actions to run smoothly.

Key Resources

Necessary for each business model; a company can reach markets, maintain relationships with customer segments, and generate revenue.

Key Partners

Relationships a business has with other people or organizations that make the business model work.

Cost Structure

To help determine how to focus on innovation and develop a value proposition; Businesses can aim to cut costs and get the most out of every cost.

Value Proposition

Customers choose a business over others because it meets their needs or solves their problems.

Organizational analysis

Study of organizations, groups, and societies and how they process principles and concepts to make their systems work

Organization

A group of individuals with a specific purpose, especially in business, society, and associations.

Properties of organization

A corporate or group actor; It claims a special and limited purpose — it has objectives; and The creators of the organization intend to make it last.

Organizational structure

Defines each worker's job and how it fits inside the system.

Decentralized organizational structure

Several people make decisions and run the operations of their groups/departments.

Centralized organizational structure

Relies on one individual to make the decisions and provide directions for the enterprise.

Simple structure

Has no functional or product categories and is appropriate for a small, entrepreneur-dominated company with one product line.

Functional structure

Appropriate for a medium-sized firm with several product lines in one industry; Employees here tend to be specialists in the business functions.

Divisional structure

Appropriate for a large corporation with many product lines in several related industries; Employees here are functional specialists organized according to product/market distinctions.

Direction

Guiding and motivating employees to accomplish entrepreneurial objectives.

People strategy

The organization’s prioritized people plan that enables a business to be successful by attracting, developing, retaining, and inspiring the workforce.

Information function (communication)

Using communication to acquire information to make sound decisions.

Motivational function (communication)

Using communication to motivate and encourage employees to contribute to attaining the goals of the business.

Control function (communication)

Using communication as a tool to clarify terms of duties, methods, authority, and responsibilities given to each member of the enterprise

Emotive function (communication)

Using communication to provide employees with an outlet for self-expression

Counseling services

A talking therapy involving a therapist that the company employs to address the employees' emotional and psychological issues.

Motivation

A desire to act and move toward a goal.

Discipline

Training individuals to comply with an organization's rules or some code of behavior.

Due process

The innate right of any individual to receive fair treatment if allegations are pitted or errors are incurred against them.

Social responsibility

An ethical framework that asserts that an individual must work and cooperate with other individuals and organizations to benefit society and their environment.

Corporate Social Responsibility (CSR)

Ethical labor practices, producing goods and services that are not harmful, preserving natural resources, and reducing carbon emissions.

Friedman’s traditional view of business responsibility

The primary social responsibility of a business is to use its resources and engage only in activities designed to increase profit so long as it stays within the rules.

Carroll’s four responsibilities of business

Producing goods and services of value, obeying laws, adhering to ethical beliefs, and engaging in voluntary responsibilities.

Peter Drucker’s view of social responsibility

Companies should ensure that their social responsibilities also become business opportunities.

Albert Carr’s view of social responsibility

Business is a game and that business ethics differs from personal life ethics.

Edward Freeman’s view of social responsibility

Any person or organization that has an underlying interest in the business should also play a role of participation in the business’ actions and decisions.

Income Statement

The report will include Revenue and Expenses account balances from the Adjusted Trial balance

Statement of Owner’s Equity (Retained earnings)

The accumulated portion of a company's profits that are not distributed as dividends to shareholders but are instead reserved for reinvestment back into the business

Balance Sheet (Statement of Financial Position)

The company’s total assets and financing methods — equity or debt.

Statement of Cash Flow

Operating activities, Investing activities, Financing activities

Return on Assets (ROA)

Shows how effectively the company has utilized its assets

Return on Investments (ROI)

The return on the owner's equity

Quick Ratio (Acid-Test Ratio)

Indicates a company's short-term liquidity and measures its ability to meet its short-term obligations with its most liquid assets.

Profit Margin/Return on Sales (ROS)

The income-to-net sales ratio.

Current Ratio

Relates current assets to liabilities and shows a firm's immediate solvency and liquidity.

Debt Ratio

Compares a company's total debt to its total assets.

Break-even Analysis Formula

Fixed Cost / (Price of the product or service – Variable Cost)

Break-even Point

The enterprise neither made a profit nor incurred a loss

Fixed Costs

Expenses that do not change as productionvolume increases or decreases within a relevant range.

Variable Costs

Costs that change concerning variations in an activity

Stockholder’s Ratio

Total Stockholder's Equity / Total Assets

Debt-Equity Ratio

Total Liabilities / Total Stockholder's Equity

Interest Coverage Ratio

Operating Income / Interest Expense