P58 - 2 Flexibility Reduced idle time Reduced WIP Dedicated cell production Benefits Reduced unnecessary tasks Reduction

in losses & Rets Rapid response to change Better staff motivation Reduced staff T/O P61 - 3 JIT Purchasing Machine Cells Set up time reduction Approach Uniform loading Kanban JIT Total Quality Employee involvement Value adding V NVA Difficult to predict demand Problems What if suppliers fail Wider geographical spread of manufacturing Premium price of supplies P64 - 4 Right first time Continuous improvement Matters to the customer Customer supplier relationship Prevention rather than cure Requirements of quality Operatives personally responsible Any level of defects unacceptable Right first time applies to all departments Introduce a quality certification programme Emphasise cost of poor QC Positive motivation Cultural orientation Workers decide how to work Responsibility to achieve targets Pull system

1. World class manufacturing

4. Modern Developments 2
05/10/2004 - v8

Change attitudes TQM

Empowerment Quality circles

Improved quality of O/P Benefits Costs & Benefits Costs Improved productivity Job satisfaction & commitment Time to learn Training costs Cost of mistakes while learning Reduce no of parts CAD Design for quality Use parts used by other products Improve physical charactaristics Production engineering Info systems Admin Distribution

P69 - KEY TERM OPPOSITE TO THE COST + MODEL REDUCE NO OF COMPONENTS USE STANDARD COMPONENTS Target costing DEALS WITH ATTAINABLE PRICE AND WORKS BACKWARDS TRAIN STAFF TECHNOLOGY CUT NVA ACTIVITIES USE DIFFERENT MATERIALS USE CHEAPER STAFF BPR HOW IT CAN REMOVE NVA HOW COSTS CAN BE CALCULATED IN A MORE MEANINGFUL WAY ACTIVIT BASED COST DRIVERS P71 - KEY TERMS

Activity Based Approaches

C:\Documents and Settings\Rich\My Documents\Business\CPA\Professional 1\Strategic Management Accounting\4. Modern Developments 2.mmp - 05/10/2004 - -

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