IGCSE Business Studies (0450): Subject Content: Operations Management

Production of goods and services

IV.B

Costs, scale of production and break-even analysis

IV.C

Achieving quality production

IV.D

Location decisions

IV.A.1

The meaning of production

IV.A.2

The main methods of production:

IV.A.3

How technology has changed and is changing production methods, e.g. using computers in design and manufacturing.

IV.B.1

Identify and classify costs

IV.B.2

Economies and diseconomies of scale

IV.B.3

Break-even analysis

IV.C.1

Why quality is important and how quality production might be achieved.

IV.D.1

The main factors influencing the location and relocation decisions of a business.

IV.A.1.a

Managing resources effectively to produce goods and services.

IV.A.1.b

Difference between production and productivity.

IV.A.1.c

Benefits of increasing efficiency and how to increase it, e.g. increasing productivity by automation and technology, improved labour skills.

IV.A.1.d

Why businesses hold inventories.

IV.A.1.e

The concept of lean production: how to achieve it, e.g. just-in-time inventory control and Kaizen; benefits of lean production.

IV.A.2.a

Features, benefits and limitations of job, batch and flow production.

IV.A.2.b

Recommend and justify an appropriate production method for a given situation.

IV.B.1.a

Classifying costs using examples, e.g. fixed, variable, average, total.

IV.B.1.b

Use cost data to help make simple cost-based decisions, e.g. to stop production or continue.

IV.B.2.a

The concept of economies of scale with examples, e.g. purchasing, marketing, financial, managerial, technical.

IV.B.2.b

The concept of diseconomies of scale with examples, e.g. poor communication, lack of commitment from employees, and weak coordination.

IV.B.3.a

The concept of break-even.

IV.B.3.b

Construct, complete or amend a simple break-even chart.

IV.B.3.c

Interpret a given chart and use it to analyse a situation.

IV.B.3.d

Calculate break-even output from given data.

IV.B.3.e

Define, calculate and interpret the margin of safety.

IV.B.3.f

Use break-even analysis to help make simple decisions, e.g. impact of higher price.

IV.B.3.g

Understand the limitations of break-even analysis.

IV.C.1.a

What quality means and why it is important for all businesses

IV.C.1.b

The concept of quality control and how businesses implement quality control.

IV.C.1.c

The concept of quality assurance and how this can be implemented.

IV.D.1.a

Factors relevant to the location decision of manufacturing businesses and service businesses.

IV.D.1.b

Factors that a business could consider when deciding which country to locate operations in.

IV.D.1.c

The role of legal controls on location decisions

IV.D.1.d