Transcript Tertiary Industry

Design for Six-Sigma
in the School of Computing, Engineering and Physical Sciences
Operational management functions
by Dr J. Whitty
1
Lessons structure
• The lessons will in general be subdivided
in to eight number of parts, viz.:
1)
2)
3)
4)
5)
6)
7)
8)
2
Statement of learning objectives
Points of orders
Introductory material (Functionality)
Concept introduction (Operational
functionality)
Development of related principles (Business
activates)
Concrete principle examples via –
reinforcement examination type exercises
Summary and feedback
Formative assessment, via homework task
Learning objectives
By the end of the session, are you able to:
• Define & label the product life cycle
• Classify products within the product life
cycle
• Describe the three types of business activities
• Classify products into these business
activities
• Answer Examination/Assignment type
questions involving product lives and
business sectors.
3
Point of order…
Draw a graph of the product life cycle and plot the
Following critical points; [5] (D) Decline, (G)
Growth, (I) Introduction, (M) Maturity and (S)
Saturation.
Sales
time
Explain saturation for the product life cycle
[2]
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[Manufacturing systems technology Examination:
Tameside College Feb 2003]
Management functionality
• As the company get bigger different departments need to
be created to assume responsibility of certain cluster of
processes.
• Often departments are organised around functional areas.
Each function is specialised and requires own knowledge
and set of skills, primary responsibilities, processes and
decision domains.
• Regardless of how functions are separated they must
remain interrelated (and many processes cut across
boundaries).
• Coordination and effective communication are critical
andare required to achieve the company’s goals.
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Functionality of scale
In large companies OM is usually responsible
for transforming inputs into products and
services.
• Accounting – collects, summarises and interprets
financial information.
• Distribution - deals with movement, storage and
handling of inputs and outputs.
• Engineering - develops products and services.
• Human resources - hires and trains people
• Marketing - generates demand for the company’s
outputs.
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Small operational scale...
Some companies never need to perform
certain functions, others save money by
subcontracting out e.g. legal services or
engineering.
• In other companies such as small business
owners might manage more than one function.
• OM managers draw on many skills to do
their job. It is good career path to move o the
ladder in many companies.
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Operations function
management
The analogous here is the old form or function when
designing a specific product or service. This will be
covered in a later lecture show it is worth pausing to
discuss this a little further here...
8
Skill areas
From an OM viewpoint functionality is usually
described in terms of skill-sets, thus:
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10
Types of industrial sectors
• Primary Industry – extractive industry – extracting raw materials e.g. coal,
fish
• Secondary Industry – manufactured and construction industries –
processing raw materials into finished goods
• Tertiary Industry – providing a direct commercial service
• Direct service – offered direct to the public e.g. hairdressing, police
service
• Commercial service – offered to other businesses e.g. recruitment
service
Some services can be both direct and commercial.
Within the UK there is a high proportion of business in the tertiary sector
than the primary and especially the secondary sector.
11
Deindustrialisation
• Using the internet if required try to find a
meaning to of the word
Deindustrialisation in terms of the
sectors we have just discussed.
12
Deindustrialisation
A long term reduction in the manufacturing sector.
Why is this?
• Less Government support given to manufacturing
• Increase in imported products
• Importance of leisure time – services increase
• Increase in small businesses – service sector
popular for business start ups
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The chain of production – the process of goods from primary industry through
secondary and tertiary industry until the end product reaches the final consumer.
Factors of production – the resources needed for the production of goods and
services.
They include:
•Land – natural resources I.e. from the earth or ocean e.g. wood, fish
•Labour – mental and physical effort e.g. employees
•Capital – money available to invest in the plant and machinery
•Enterprise – the business idea – brings the other factors of production together.
All of these resources are sold to be scarce thus businesses have to decide how to
make best use of these resources.
There is always an opportunity cost to the decision made.
Opportunity cost – the alternative that is scarified when a particular decision is
made. For example if you have £25 to spend and you have a choice of a shirt or
jumper. If you buy the jumper the opportunity cost is the shirt.
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Types of Economy
• Deindustrialisation coupled with the
activates of a business just outlined
enable generally THREE types of
economy to be set up; in your Buzz
groups try to decide what these are.
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Types of Economy
All countries operate in an economic system. There are 3 economic systems:
•Market Economy
An economy where there is NO Government intervention. Goods and services are
provided in response to demand. Price is decided by supply and demand. The profit
motives is very important to businesses. The problem can be that certain products
and services may not be provided if they do not generate a profit. No real example,
USA is the nearest
•Planned / Command Economy
An economy where all decisions are government. They decide what to produce,
how to produce it and in what quantities. All businesses are owned by the
government. There can be a shortage of luxury products and services. E.g. Cuba
•Mixed Economy
An economy where there is government (public) and private organisations operating
together. Most economies are mixed economies but the production of that mix does
vary. E.g. UK, France, Germany e.t.c.
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Private and Public Sector
Within the UK organisations can operate in the public and / or private sector.
That is why we have a mixed economy.
Private sector
Public sector
Sole trader
Nationalised industries
partnership
Central Government
Limited companies – Plc
and Ltd
Local Government
Franchises
Co-operatives
All of these organisations operate in a market.
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Market
Where buyers and sellers come together to exchange goods
and services for a price.
Types of market – these buy and sell the following:
•Consumer durable – long lasting goods e.g. washing
machines
•Consumer non durable – goods consumed quickly e.g. food,
clothes
•Industrial – goods and services to other businesses
•Labour – the use of people skills
•Capital - money
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Class discussion time:
Manufacturing and services
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The differences between manufacturing and service
operations fall into seven categories, these being:
1. Physical nature
2. Inventories
3. Customer contact
4. Response time
5. Location
6. Size
7. Quality
In your buzz groups discuss these and indentify any
similarities that may exist between these types of
business activities also.
Continuum of characteristics
• Physical, durable product
• Output that can be inventoried
• Low customer contact
• Long response time
• Regional, national, or
international markets
• Large facilities
• Capital intensive
• Quality easily measured
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• Intangible, perishable
product
• Output that cannot be
inventoried
• High customer contact
• Short response time
• Local markets
• Small facilities
• Labour intensive
• Quality not easily measured
Examination Type Questions
1.
Carlton Press Ltd is a small publishing company specialising in
educational books. Draw a diagram showing the typical stages of
production and distribution of one of its books.
(5)
The stages in producing and distributing the educational
Books may be as follows:
Timber felling
Paper making
Printing company
Warehouse
Bookshops
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Schools
(b) There are three kinds of business activity involved in the
production and distribution of the books – primary, secondary and
tertiary.
Describe each kind of business activity and give an example.
Kind of business activity
Description
Example
Primary
Secondary
Tertiary
(9)
[Bolton Institute June 2000]
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Summary and feedback
Have we met the following learning objectives?
• Define & label the product life cycle
• Classify products within the product life
cycle
• Describe the three types of business activities
• Classify products into these business
activities
• Answer Examination/Assignment type
questions involving product lives and
business sectors.
By which slide did you achieve each
on?
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1.
Further Examination Type
Questions
The table below shows the values of output and levels of employment
for the secondary and tertiary sector in town of Woolford during the
period 1988 to 1994.
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Year
Output £m
Secondary
sector
employment
Tertiary
sector
employment
Total
employment
1988
1800
28 500
46 500
75 000
1989
1836
28 860
49 140
76,000
1990
1876
29 520
52 480
82 000
1991
1848
27 150
50 850
78 000
1992
1820
25 160
48 840
74 000
1993
1836
24 750
50 250
75 000
1994
1844
24 320
51 680
76 000
(i) How many people were employed in the secondary sector in
1988? (1)
(ii) What was the total number of people employed in the town of
Woolford in 1989? Show your working. (2)
(iii) During the period 1990 to 1992 what happened to:
The value of output? (2)
The total level of employment? (2)
(iv) Using the figure in the table, describe what happened between
1990 and 1994 to each of the following:
Employment in the secondary sector: (2)
Employment in the tertiary sector: (2)
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(b) Suzanne Hart had worked for Tastybread Bakeries ltd. In
Woolford for eight years. She worked as a baker and later
moved into the marketing department where she worked for
three years before being made redundant.
(i) What is meant by ‘being made redundant’? (2)
(ii) Give TWO reasons why Suzanne may have been made
redundant. (2)
(c) After being unemployed for some time, Suzanne decided to
start her own bakery, ‘Aunt Sue’s’, selling braed and
confectionery from a small shop.
(i) How might her experience with Tastybread Bakeries Ltd.
Help her to start the new bakery? (4)
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Another Examination Type
Question
2. Give one example of a business activity in each of the
following sectors. (3)
Sector
Primary
Secondary
Tertiary
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Example
(b) The graph below shows the values of output by sector in
1968 and 1998 in the economy of the town of Bowton.
Value of Output by Sector Economy of Bowton
1968 - 1998
200
180
160
140
120
100
80
60
40
20
0
1968
1998
primary
sector
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secondary
sector
tertiary
sector
(i) Describe the main changes that have taken place. (4)
(ii) What are the reasons for the changes in the tertiary sector?
(4)
(c) The table below shows the levels of employment by sector,
in 1968 and 1998, in the economy of the town of Bowton.
Working Population – by sector
Economy of Bowton
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1968
1998
Primary sector
1 000
500
Secondary sector
9 000
4 000
Tertiary sector
10 000
16 000
(i) Describe the main changes in the levels of employment
by sector that have taken place between 1968 and 1998.
(4)
(ii) Explain, why the changes in employment in the
secondary sector may have occurred. (4)
(iii) Are the changes in employment that have taken place a
problem for the people of Bowton? Give reasons for
your answer. (8)
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