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Business Studies IGCSEPDF 19
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●
The output measured against the inputs used to create it.
Formula:
● Productivity = quantity of output ÷ factor of production
● Labour productivity:
A measure of output produced per worker over a given time period.
● Efficiency:
Producing goods and services by using the minimum possible amount of
resources while maintaining quality.
Lean production:
●
An approach that aims to minimise waste and improve efficiency in the
production process.
● Waste:
Any activity or resource that does not add value to the final product (e.g. time
delays, defects, excess inventory).
● Just-in-time (JIT):
A production method where materials and components are delivered only when
needed, reducing inventory costs.
● Kaizen:
A Japanese term meaning “continuous improvement,” involving all workers
suggesting small changes to improve efficiency.
Job production:
●
Producing one product at a time, customised to the customer’s requirements
(e.g. wedding dresses, ships).
● Batch production:
Producing a group of identical products at the same time before moving to the
next batch.
● Flow production (mass production):
Continuous production of identical products on an assembly line.
● Automation:
Using machines and technology instead of human labour in production.
● Mechanisation:
Using machines to assist human labour, where workers still control or operate
the machines.
● Economies of scale:
The cost advantages a business gains as it increases production, reducing the
average cost per unit.
● Diseconomies of scale:
When a business becomes too large and inefficiencies cause average costs to
rise.
Productivity: