Operations

Question	Answer
Transformation	Any changes to inputs that adds value and converts them to outputs.
Inputs	The raw materials, components and parts used to produce a good or supply a service.
Outputs	What is made or supplied by the operations process. The product the business will on-sell to customers.
Productivity	A measure of how efficiently goods and services are produced. It is usually measured in terms of output per labour hour.
Competitive Advantage	The use of specific strategies to gain an advantage over competitors. Could be based on cost of production, quality, unique product features etc.
Efficiency	Achieving maximum output with the minimum level of inputs. It involves achieving an objective without wasting resources and keeping costs as low as possible.
Cost Leadership	Operations strategy - involves being the cheapest producer of a product in the market - means you can either undersell your competitors or sell for the same price and make increased profits. eg. Air Asia
Product Differentiation (Good/service Differentiation)	Operations Strategy - to have different features to your competitors to create a competitive advantage.
Economies of Scale	When mass producing, a business can buy inputs cheaper 'in bulk'. The more outputs the business produces, the larger volume of inputs they can purchase. This will bring their overall costs of production down.

Resource summary

	Created by Elizabeth Clifford about 11 years ago