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Unit 5 Operations management

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4 topics · 8 learning objectives

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  1. 5.1 Introduction to operations management

    1. • Analyse the role of operations management • Operations management organizes production of goods and services to meet objectives efficiently

  2. 5.2 Operations methods

    1. 5.2.1

      • Evaluate job production, batch production, mass/flow production, and mass customization • Method choice affects cost, quality, flexibility, speed, and customer responsiveness

  3. 5.4 Location

    1. • Analyse reasons for a specific location of production • Location factors include cost, labour, suppliers, infrastructure, market access, government policy, and environmental issues

    2. • Evaluate outsourcing or subcontracting, offshoring, insourcing, and reshoring • Reorganization affects cost, quality, control, flexibility, employment, and reputation

  4. 5.5 Break-even analysis

    1. • Distinguish total contribution and contribution per unit • Contribution supports break-even, pricing, and output decisions

    2. • Construct and interpret break-even quantity or point, profit or loss, margin of safety, target profit output, target profit, and target price • Break-even analysis uses fixed costs, variable costs, total costs, revenue, and contribution

    3. • Analyse effects of price or cost changes on break-even quantity, profit, and margin of safety • Use both graphical and quantitative methods

    4. • Evaluate limitations of break-even as a decision-making tool • Limitations include assumptions about linear costs/revenue, fixed prices, single products, and certainty