operations management
Methods used by businesses to create products and services that are efficient
added value
increasing the gap between production cost and selling price
added value calculation
selling price - production costs
how to increase added value
- build a brand
- add differentiating features
- convenience
- provide outstanding customer service
benefits of added value
- can charge higher prices
- unique selling point differentiation from competitors boosts sales
drawbacks of added value
- costs time and money to create
- high price creates high expectations which business might not be able to back
job production evaluation
+ produces a high quality product
+ meets the needs of the individual
+ greater job satisfaction for employees
- high production costs
- slower than flow and batch
batch production evaluation
+ batches reduces production cost
+ specific customer needs can still be met at a faster rate
- productivity is effected during downtime
flow production evaluation
+ low cost in the long run because of machinery
+ be able to buy raw materials in bulk cheaper
- large initial capital costs
- time consuming and expensive to make changes (disrupts the flow)
