HSC BUSINESS - TOPIC 1 OPERATIONS Operations and customer focus 1 Create minimal waste Most efficient production process 2 Reflect fair value for any

HSC BUSINESS - TOPIC 1 OPERATIONS Operations and customer...

This preview shows page 1 - 3 out of 55 pages.

TOPIC 1 OPERATIONS Operations and customer focus 1. Create minimal waste- Most efficient production process 2. Reflect fair value for any labour used in processes- Workers aren’t being exploited, fair wages and Safety 3. Operate at low cost so as to maximise affordability- Produce g/s at fair prices that are affordable to most customers 4. Integrate environmental awareness and a need for ecologically sustainable practices- Environmentally friendly (Reducing greenhouse gases) 5. Reflect changes in the needs of consumers over time- Bring new innovate goods that customers want Role of Operations Management Strategic role of operations management-Cost leadership, g/s differentiation -Strategic (Vital) means affecting all other key business areas -Cost centres are the business area which incur cost (operations function) -Cost in the operations function: Input costs 1. Capital 2. Land Labour costs 1. Overtime 2. Superannuation Processing costs 1. Electricity 2. Scheduling Inventory costs 1. Storage 2. Damaged goods Quality management costs 1. Sampling new g/s 2. Remediation through warranty claims - Cost leadership involves aiming to have the lowest costs or to be the most price competitive in the market Economies of scale and cost management- Cost advantages that arise due to the business expanding its operations Eg mass production - G/s differentiation Goods Tangible Usually standardised, sometimes customised Goods can be owned & transferred Time between production and consumption considerable Value calculated by calculating inputs and adding a margin Services- Intangible Generally customised however may be standardised Services cannot be owned Production and consumption are simultaneous
Image of page 1
Value is highly subjective Product differentiation - Distinguishing product in some way from its competitors Goods Varying the actual product features Varying product quality Varying any augmented features (add-ons, warranty) Services Varying the amount of time spent on a service (Time is the factor that differentiates services) Varying the level of expertise brought to a service Varying the qualifications and expertise of the service provider Varying the quality of materials/technology used in service (New technology) Cross branding- Differentiation can be created through cross branding or strategic alliances (Eg Woolworths-Caltex) G/s in different industries -Standardised goods are mass produced and uniform in quality they are produced with a production focus -Customised goods are varied according to the needs of customers and produced with market focus -Perishable goods have a short life span, operations must integrate the following: High standards of quality and safety Very short lead time (Quick distribution) Robust packaging and cold storage Non-perishable goods are more durable and bring different issues Manage all aspects of quality in the process (Production and distribution) Implement effective management strategies -
Image of page 2
Image of page 3

You've reached the end of your free preview.

Want to read all 55 pages?

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes