Increasing Efficiency and Production

Flashcards covering factors of production, firm efficiency, and lean production techniques including JIT and Kaizen.

What are the three main factors of production for any business?

Labour, land, and capital equipment.

How do high wages impact a firm's costs and competitiveness?

High wages increase variable costs, making the firm less competitive.

What determines the optimal balance of resources a firm uses?

The nature of the firm, for example, mass production is more capital intensive, while service providers are more labour intensive.

What is the primary goal of lean production techniques?

To reduce waste from the manufacturing process.

Describe Just In Time (JIT) manufacturing as a lean production technique.

Goods are made to order, and components are ordered only once a customer places an order.

What is Kaizen's role within lean production?

It is a system where continuous improvements are sought by the workforce through their opinions and problem-solving.

What are some practical applications of lean production, as exemplified by Toyota?

Avoiding unnecessary parts, reducing all forms of waste, finding the source of defects, maintaining a tidy and organized work environment, replenishing components only when needed, and encouraging employees to problem solve.