Operations and Management Flashcards

What is a Key Performance Indicator (KPI)?

Answer: A measurable value that demonstrates how effectively a company is achieving its objectives

KPIs are measurable values used to track and evaluate how effectively a company is meeting its key business objectives.

What is the primary purpose of Standard Operating Procedures (SOPs)?

Answer: To ensure consistency and quality by documenting how routine tasks should be performed

SOPs document step-by-step processes so that tasks are performed consistently, reducing errors and improving quality across the organization.

What does 'lean operations' primarily focus on?

Answer: Eliminating waste and maximizing value delivered in business processes

Lean operations is a methodology centered on minimizing waste (time, materials, effort) while maximizing the value delivered to customers.

What does inventory turnover measure?

Answer: The number of times a company's inventory is sold and replaced over a given period

Inventory turnover indicates how many times inventory is sold and restocked in a period, reflecting operational efficiency and demand management.

What is supply chain management?

Answer: The oversight of all activities involved in sourcing, procurement, production, and product delivery

Supply chain management encompasses all activities from raw material sourcing through production, logistics, and final delivery to the end customer.

What do 'economies of scale' refer to?

Answer: The cost advantages a business achieves as its production volume increases

Economies of scale occur when the cost per unit decreases as production volume increases, giving larger operations a competitive cost advantage.

What is a business dashboard used for?

Answer: A visual tool that displays key business metrics and KPIs in real time

A business dashboard provides a visual, at-a-glance view of key performance data, enabling managers to monitor operations and make timely decisions.