the product meets global standards. If not, you risk getting an inferior product. Think AbouT iT... Why are the letters ISO an acronym for the International Organization for Standardization? Shouldn’t it be IOS, or the International Standards Organization? Actually, since the organization is international, it did not want to select a name that would produce a different acronym in every country. Instead, it took the Greek word for “equal,” isos, and shortened it to ISO.
Lesson 6, page 18 Introduction to Business BBI2O-B Copyright © 2008 The Ontario Educational Communications Authority. All rights reserved. The Production Process and the Lemonade Stand What processes are required for Ellen and Ramón to make their lemonade? Purchasing : In Lesson 4, when Ellen and Ramón met with Rhonda Sharpe, the fruit wholesaler, they were negotiating the price of lemons. They need sugar, so they will probably also look for the best price for sugar. As the business is not very large, it will be difficult for them to save a great deal of money on their raw materials. (Most wholesalers negotiate better prices based on volume.) Grading : Ellen and Ramón are looking for Fancy Grade lemons, which are the best quality, and pure cane sugar, which Ramón thinks makes better lemonade than honey or corn syrup. Processing : They have to cut a lot of lemons. Thank goodness they have a juicer that processes the lemons into juice, even if it is old and slow. Quality control : Ellen and Ramón are responsible for quality control; they taste test a lot of lemonade.
Introduction to Business BBI2O-B Lesson 6, page 19 Copyright © 2008 The Ontario Educational Communications Authority. All rights reserved. Support Question (do not send in for evaluation) 5. A tomato-sauce factory uses salt, sugar, and tomatoes to make its product. Complete the following chart by explaining briefly how the four steps in the production process relate to the tomato-sauce manufacturer. An example of one of the processing steps is provided to start you off. Processing • Salt from salt mines is ground and packed in large bags Purchasing Grading Quality Control
Lesson 6, page 20 Introduction to Business BBI2O-B Copyright © 2008 The Ontario Educational Communications Authority. All rights reserved. Improving Productivity One measure of productivity is the number of products that can be made to meet quality standards within a given period of time. How many basketballs can you sink from the free-throw line in 10 minutes? If you can sink 25 out of 50 tries, and your friend can sink only 10, you are more productive than your friend. If the NBA standard is 48 out of 50, however, you are not productive enough to consider playing pro basketball. This productivity measure relies on a visible output: sunk basketballs. You can count output and measure it against time or cost or the output of others. Factory productivity is often measured this way. If you are running a service business, on the other hand, such as a travel agency, and during the month of
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