1. C h a p t e r 20 GLOSSARYGLOSSARY EXIT Glossary Modern Management, 9 th edition Click on terms for definitions Break-even analysis Break-even point Budget Capacity strategy Computer-aided design (CAD) Computer-aided manufacturing (CAM) Control tool Decision tree analysis Effectiveness Efficiency Fixed costs Fixed-position layout Human resources Job design Just-in-time (JIT) inventory control Layout Layout strategy Location strategy Loss Management by exception Manpower planning Materials control Motion-study techniques Operations control Operations management Process (functional) layout Process control Process strategy Product layout Product strategy Production Production control Productivity Profits Pure breakdown (repair) policy Pure-preventive maintenance policy Quality Quality assurance Quality circles Ratio analysis Robotics Statistical quality control Total costs Total revenue Value analysis Variable budget Variable costs Work measurement methods Work methods analysis Zero-base budgeting

2. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Break-even analysis is a control tool that summarizes the various levels of profit or loss associated with various levels of production.

3. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary The break-even point is that level of production where the total revenue of an organization equals its total costs.

4. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A budget is a control tool that outlines how funds will be obtained and spent in a given period.

5. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Capacity strategy is an operational plan of action aimed at providing the organization with the right facilities to produce the needed output at the right time.

6. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Computer-aided design (CAD) is a computerize technique for designing new products or modifying existing ones.

7. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Computer-aided manufacturing (CAM) is a technique that employs computers to plan and program equipment used in the production and inspection of manufactured items.

8. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A control tool is a specific procedure or technique that presents pertinent organizational information in a way that helps managers to develop and implement an appropriate control strategy.

9. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Decision tree analysis is a statistical and graphical multiphased decision-making technique that shows the sequence and interdependence of decisions.

10. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Effectiveness is the degree to which managers attain organizational objectives; it is doing the right things.

11. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Efficiency is the degree to which organizational resources contribute to production; it is doing things right.

12. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Fixed costs are expenses incurred by the organization regardless of number of products produced.

13. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A fixed-position layout is a layout plan appropriate for organizations involved in a large number of different tasks that require low volumes, multipurpose equipment, and broad employee skills.

14. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A human resources strategy is an operational plan to use the organization’s human resources effectively and efficiently while maintaining or improving the quality of work life.

15. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Job design is an operational plan that determines who will do a specific job and how and where the job will be done.

16. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Just-in-time (JIT) inventory control is a technique for reducing inventories to a minimum by arranging for production components to be delivered to the production facility “just in time” to be used.

17. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A layout is the overall arrangement of equipment, work areas, service areas, and storage areas within a facility that produces goods or provides services.

18. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Layout strategy is an operational plan that determines the location and flow of organizational resources around, into, and within production and service facilities.

19. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Location strategy is an operational plan of action that provides the organization with a competitive location for its headquarters, manufacturing, services, and distribution activities.

20. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Loss is the amount of the total cost of producing a product that exceeds the total revenue gained from selling the product.

21. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Management by exception is a control tool that allows only significant deviations between planned and actual performance to be brought to a manger’s attention.

22. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Manpower planning is an operational plan that focuses on hiring the right employees for a job and training them to be productive.

23. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Materials control is an operational activity that determines the flow of materials from vendors through an operations system to customers.

24. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Motion-study techniques are operational tools that are used to improve productivity.

25. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Operations control is an operational plan that specifies the operational activities of an organization.

26. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Operations management is the systematic direction (strategy) and control of operations processes that transform resources into finished goods and services; it is getting things done by working with or through other people.

27. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A process (functional) layout is a layout pattern based primarily on grouping together similar types of equipment.

28. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Process control is a technique that assists in monitoring production processes.

29. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Process strategy is an operational plan of action outlining the means and methods the organization will use to transform resources into goods and services.

30. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A product layout is a layout designed to accommodate a limited number of different products that require high volumes, highly specialized equipment, and narrow employee skills.

31. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Product strategy is an operational plan of action outlining which goods and services an organization will product and market.

32. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Production is the transformation of organizational resources into products.

33. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Production control ensures that an organization produces goods and services as planned.

34. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Productivity is the relationship between the total amount of goods or services being produced (output) and the organizational resources needed to produce them (input).

35. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Profits are the amount of total revenue that exceeds total costs.

36. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Pure breakdown (repair) policy is a maintenance control policy that decrees that machine adjustments, lubrication, cleaning, parts replacement, painting, and needed repairs and overhaul will be performed only after facilities or machines malfunction.

37. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Pure-preventive maintenance policy is a maintenance control policy that tries to ensure that machine adjustments, lubrication, cleaning, parts replacement, painting, and needed repairs and overhauls will be performed before facilities or machines malfunction.

38. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Quality is the extent to which a product reliably does what it is intended to do.

39. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Quality assurance is an operations process involving a broad group of activities that are aimed at achieving the organization’s quality objectives.

40. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Quality circles are small groups of workers that meet to discuss quality- related problems on a particular project and communicate their solutions to these problems to management at a formal presentation session.

41. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Ratio analysis is a control tool that summarizes the financial position of an organization by calculating ratios based on various financial measures.

42. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Robotics is the study of the development and use of robots.

43. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Statistical quality control is the process used to determine how many products should be inspected to calculate a probability that the total number of products will meet organizational quality standards.

44. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Total costs are the sum of fixed costs and variable costs.

45. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Total revenue is all sales dollars accumulated from selling the goods or services produced by the organization.

46. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Value analysis is a cost control and cost reduction technique that examines all the parts, materials, and functions of an operation.

47. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary A variable budget (also known as a flexible budget) is one that outlines the levels of resources to be allocated for each organizational activity according to the level of production within the organization.

48. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Variable costs are expenses that fluctuate with the number of products produced.

49. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Work measurement methods are operational tools that are used to establish labor standards.

50. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Work methods analysis is an operational tool used to improve productivity and ensure the safety of workers.

51. © Prentice Hall, 2002 RETURN to Chapter termsEXIT Glossary Zero-base budgeting requires managers to justify their entire budget request in detail rather than simply referring to budget amounts established in previous years.