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Chapter 8 Sum Up

The document discusses operations and materials management, including the costs associated with raw materials, plant, labor, inventory and distribution. It also covers different types of production such as mass production, flexible production, small-batch production and customized production.

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Javier
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5 views

Chapter 8 Sum Up

The document discusses operations and materials management, including the costs associated with raw materials, plant, labor, inventory and distribution. It also covers different types of production such as mass production, flexible production, small-batch production and customized production.

Uploaded by

Javier
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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CHAPTER 8-PRODUCTION: OPERATIONS AND MATERIALS MANAGEMENT

- Operations: a company’s system of value-creation activities used to transform inputs into


finished goods and services.
- Materials management: set of activities that control the flow of resources into and out of a
firm’s operating system.
- Operation and material management costs: Raw materials, plant, labour, inventory,
distribution costs.
- Raw materials and component costs: comprise a significant percentage of companies’ total
operating costs, particularly companies that make physical products.
- Plant Costs: cost of the machinery, computers, tools, buildings, and equipment needed to
transform inputs into finished products.
- Labour Costs: number of employees needed to produce a given quantity of outputs, amount
each employee must be paid and health and social insurance benefits each employee is given.
- Inventory Costs: the resources (materials, supplies, and goods) a company holds in stock.
- Work-in-process goods: the semifinished goods that move through a company’s production
process.
- Three types of inventory: Input: inputs, resources, Conversion: work-in-progress, Output:
finished products.
- Distribution Costs: the cost of getting products to customers.
- Small-batch production: OS designed to make one-of-a-kind or small quantities of customized
products.
- Customized products: products designed to match the need of individual customers.
- Mass production: an operating system based on the use of automated machines and standard
operating procedures to make work routine and create a large number of standardized
products.
- Standardized products: products that are identical.
- Flexible production: combines the benefits of mass production with the benefits of small-batch
production.
- Computer-integrated manufacturing: a manufacturing technique that controls the changeover
of machines from one operation to another via computer software.
- Flexible work team: a team of self-managed employees who assume responsibility for
performing the operating tasks necessary to make a part, or all, of a product.
- Production layout: the way teams of employees are physically grouped into work cells or pods
to assemble a product.
- Total quality management: an operations technique to continuously improve the production
process, increase the quality of products, and help companies lower their operating costs.
- Quality control circles: team meetings in which production employees discuss ways to improve
operating quality and productivity.
- Computer-aided materials management: a technique that relies on computers to manage the
flow of raw materials and component parts into and out of a company’s operating system.
- Global supply chain management: the coordination of the flow of raw materials, semifinished
goods, and finished products around the world.
- Just-in-Time Inventory System: an inventory management system whereby inputs are
delivered to the firm just when they are needed rather than being purchased and warehoused
prior to their use.

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