Managing Small Business Operations

A collection of vocabulary terms and definitions relevant to managing small business operations.

Operations

The processes used to create and deliver a product or service.

Operations Management

The planning and control of a conversion process that includes turning inputs into outputs that customers desire.

Value Chain

Steps a product takes from nothing to the end user.

Flexible Manufacturing Systems

Manufacturing operations that involve computer-controlled equipment that can produce products in smaller or more flexible quantities.

Just-in-Time Inventory Systems

A method of cutting inventory carrying costs by making or buying what is needed just as it is needed.

Total Quality Management (TQM)

An all-encompassing management approach to providing high-quality products and services, emphasizing customer needs and continuous improvement.

Economic Order Quantity

An index that determines the quantity to purchase in order to minimize total inventory costs.

ABC Classification

A system of classifying items in inventory by dollar velocity.

Capacity Considerations

A small company's capacity to offer products or services, critical for meeting demand and determining startup costs.

Demand Management Strategies

Operational strategies used to stimulate customer demand when it is normally low.