2.4 - recourse management

define recourse management

is the central business function of creating the product or service and delivering it to the customer

what are the 4 types of production

• batch

• flow

• job

• cell

what is job production

job production is where a single product is made to meet the specific customer requirements

advantages and disadvantages - job production

ADV

• high quality, highly customised - tailored to customer needs

• employees can be more motivated - more job satisfaction - therefore flexible

DIS

• labour intensive - high labour cost = potential for higher production cost

• reliant on high skilled workers

what is batch production

batch production is where goods are produced in groups or batches

Advantages and disadvantages - Batch production

ADV
capital intensive
lower production costs due to economies of scale
can be automated to some extent
flexible to produce different products

DIS

down time - to switch from one batch to another

tasks may be repetative - demotivating

What is flow production

flow production is the manufacturing process that is continuous , where identical products are made on an assembly line

Advantages and disadvantages - flow production

ADV

• cost per unit of production reduced through economies of scale - output high

• capital intensive = less need for skilled workers

DIS

• capital investment is high in the short term -

• potential for overproduction and waste due to lack of flexibility - hard to switch products quickly.

what is cell production

cell production is where production is organised into small teams responsible for completing a specific part of the process

Advantages + disadvantages - cell production

ADV

• improves quality and flexibility, fosters teamwork and motivation;

• minimal movement of the product - reduces redundancy - immediate feedback from the employee

DIS

• high setup costs and potential for resource duplication.

what is the optimal mix of production (labour intensive vs capital intensive)

• labour intensive = highly specialist, personal , bespoke, high skill

• Capital = mass production, standardisation, efficient production

define - productivity

measures the output produced in relation to the inputs it has used

formula - labour productivity

outputs during a period/ number of employees

formula - capital productivity

output during a period of time/ number of capital

Factors affecting productivity

• motivation - motivation theorist

• skill levels - if highly skilled = more productive

• capital productivity - automation

what is efficiency

Efficiency refers to the ability to achieve maximum output with the least amount of input, optimizing resources and minimizing waste.

formula - unit cost

total cost/ total output

factors influencing efficiency

• improve standardisation - uniform products - easier to buy raw materials in bulk

• outsourcing - work can be given to other businesses for lower costs

• lean production - it aims to use fewer recources - less factory space - materials - labour capital - time

Advantages and disadvantages of capital inensive

• higher productivity - less human error

• decrease long term cost

• output higher

• quality consistent

DIS

• high initial cost - high maintenance

• wastage cost - defective products

• down time - depreciating asset

Advantagse and disadvantages - labour capital

ADV

• lower maintenance cost - ideal for start-ups - less expensive to set up

• provides jobs

DIS

• higher recruitment cost - absenteeism + labour turnover

• lower productivity - human error increases

formula - capacity utilisation

(actual output/ maximum output) x 100

what is capacity utilisation

how effectively a business uses its available production capacity

what is the ideal capacity utilisation

80% - 90%

to maximise efficiency, lower unit cost and maintain flexibility