Question

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A company’s level of productivity is made known when the company is able to successfully lower cost while increasing efficiency. It has been referred to as outputs/inputs and tradeoffs are the most important part of this equation (Vonderembse & White, 2013). When productivity is active in a business, it is able to drive and increase business performance. Oftentimes a company begins to produce more of a product giving consumers more to consume. Meanwhile, a business must be able to remain profitable and certain tradeoffs are necessary to make this happen. The most common tradeoffs that take place are among capital, labor and raw materials. Take a huge corporate store like Apple. Their profit seems to be at its highest when the cost of their product is at its lowest. The data has displayed that because the price of its product has declined, the quantity of its sales increases while causing profit to also increase. In this situation, the reason why efficiency, profitability and productivity took place was although more quantities were being made, the labor portion did not change thus causing bottom line profits to expand drastically (Vonderembse & White, 2013). In this situation, apple was able to keep costs low while productivity high (Vonderembse & White, 2013). Another example of a tradeoff can be seen when substituting materials for labor. This can be seen a lot today in modern day sales. Take a company like an upholstered household furniture store whom is known to be an important source of demand for forest products. For a furniture store to truly prosper it must be located in an area when all input factor costs are considered to be extremely low and where a business is able to differentiate. Therefore, the business can substitute materials for labor by being able to manufacture their own products in a climate adjusted location. This can help them successfully decrease their overall cost through the availability of their own products causing demand to increase as well as the differentiation of their product due to it being manufactured within the same facility and labor.

Answer 1

Operational management involves planning, organizing, and overseeing processes and making the necessary improvements for greater benefit. Adjustments in day-to-day operations should support strategic business objectives, and this is preceded by in-depth analysis and measurement of current processes. To increase business efficiency, you need to increase productivity at the lowest cost. This increases the performance of the company and its production activities. Therefore, to increase product consumption and increase product productivity, it is necessary to earn income. This main source is the raw material, work, the capital. To exist in the market, you need quality, price, acceptable reputation in business and dependability. In Operations, management involves the administration of the process by which raw materials, labor, and energy are converted into goods and services. People’s skills, creativity, practical analysis, and technological knowledge are all important to success in operational authority. In order to work efficiently, businesses need to use the smallest amount of resources needed and try to meet customer requirements at the highest possible standard.

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