Chapter 10 Business Environment Notes
• Canada is a large industrial company with many major industries. One of the worlds
largest forestry producers.
• However, Canada is facing some serious challenges to its ability to remain a modern,
competitive industrial country
• Research and Development: Work directed toward the innovation, introduction, and
improvement of products and processes.
• Its how one uses technology is what will give someone an edge
• Production: The creation of goods and services using the factors of productions: land,
labour, capital, entrepreneurship, and knowledge.
• Production management: Described management activities that helped firms create
goods. But the nature of business has changed including internet services have
• Operations Management: Specialized area in management that converts or transforms
resources into goods and services. (Ex. Inventory management, quality control). About
creating a good experience for the customer
• Using computers is one of they ways the service sector is improving productivity
• Facility Location: The process of selecting a geographic location for a company’s
• In keeping with the need to focus on customers, one strategy is to find a site that makes
it easy for consumers to use the company’s services and to communicate about their
• Some companies are willing to spend millions of dollars to move their locations because
of long-term benefits
• Outsourcing (moving certain functions such as call centres to other countries at a
cheaper value) has become extremely popular.
• Telecommuting: Working from home via computer. This is a major trend in business.
• Using telecommuting companies no longer need to locate near sources of labour
• Facility Layout: The physical arrangement of resources, including people, to most
efficiently produce goods and provide services to customers.
• Layouts such in places like hospitals can help improve efficiency within their system
• Assembly-line layout: Used for repetitive tasks
• Process layout: Frequently used in operations that serve different customers’ needs
• Modular: Can accommodate changes in design or customer demand
• Fixed position layout: A major feature of planning is scheduling work operations
• Materials requirement planning (MRP): Computer based management system that sues
sales forecasts to ensure that needed parts and materials are available at the right time
and place. • Enterprise resources planning: a newer version of MRP, combines the computerized
functions of all the divisions and subsidiaries of the firm—such as finance, human
resources, and order fulfillment—into one integrated software program that uses a
• Purchasing: The function that searches for high-quality material resources, finds the
best suppliers, and negotiates the best price for quality goods and services.
• Just in time inventory: Keeps a minimum inventory on the premises and delivers parts,
supplies, and other needs just in time to go on the assembly line
• Quality: Consistently producing what the customer wants while reducing errors before
and after delivery to the customer.
• Six Sigma quality: Sets a benchmark of just 3.4 defects per million opportunities. This is
used to prevent constant occurrence
• Statistical quality control: the process some managers use to continually monitor all
phases of the production process and assure quality is built into the product from the
• Statistical process control: The process of testing statistical samples of a product at each
step of production and displaying it on a graph.