Managing Inventory and Supply Chains

What are the three examples of operational objectives?

Flexibility, speed of response, and dependability.

Why is flexibility important in operational objectives?

Allows businesses to respond to changes in demand with little notice.

What is mass customisation?

Involves making products in mass for lower unit costs, followed by a final process for customisation.

How can mass customisation benefit businesses?

Allows businesses to respond to customer needs by customising requested products.

What is the significance of speed of response in operations?

Contributes to customer satisfaction by meeting their expectations for the time taken to produce and distribute products.

How can a business improve its speed of response?

By focusing on efficiency during the production process to increase productivity.

Why is dependability critical in operational objectives?

Customers trust reliable businesses that fulfill orders as placed.

How can a business enhance its dependability?

By ensuring it uses reliable suppliers it can trust.

What does outsourcing involve?

Using another business to make part of a product or provide part of a service.

What is a key advantage of outsourcing?

Cost savings, as a third-party may produce a product or service at a lower cost.

What is a disadvantage of outsourcing?

It can lead to quality problems if the outsourcing business does not maintain quality standards.

What is an inventory?

A list of all the stock held by a business.

What do inventory control charts show?

Max stock level, re-order level, lead time, and buffer stock.

What is a buffer stock?

Spare stock held by a business in case of unexpected increases in demand.

What approach can be used to increase supply while minimizing waste?

Producing to order.

How can flexible workers impact supply?

They can support the business flexibly when demand increases.