Login
Email
Enter an email address
Password
Enter a password
New here? Join instead
Join
Recommended
Annual
₹83.25
/month
billed at ₹2400 ₹999/year
Select
doneRevision Notes
doneTopic Questions
Monthly
₹200
/month
billed at ₹200/month
Select
doneRevision Notes
doneTopic Questions
First Name
Enter first name and surname
Last Name
Email
Enter an email address
Password
Enter a password
Confirm Password
₹200
/month
Already have an account? Login instead

4.1 Production of Goods and Services

Homearrow_rightBusiness Studies arrow_right Revision Notes arrow_right IGCSE arrow_right Operations Management arrow_right Production Of Goods And Services
IGCSE Business · Change course

Cambridge IGCSE Business (0264) syllabus reference: 4.1.1 and 4.1.2

Success criteria - by the end of this topic you can:
Key terms
Production - converting inputs into goods and services.
Productivity - a measure of the efficiency of inputs, e.g. output per employee.
Lean production - techniques that reduce waste and increase efficiency.
Just-in-time (JIT) - inventory arrives exactly when it is needed, so very little inventory is held.
Kaizen - continuous improvement through many small changes suggested by employees.
Worked example: Labour productivity

Labour productivity = output per period / number of employees
A factory makes 1200 rugs a week with 40 employees: 1200 / 40 = 30 rugs per employee per week.

Why efficiency matters: lower costs per unit, more competitive prices, higher profit. How: increase automation and technology, improve labour skills through training, improve motivation, lean production.

Lean production (JIT and Kaizen)
AdvantagesDisadvantages
Less money tied up in inventoryProduction stops if suppliers are late
Less storage space and wasteNo inventory for sudden rises in demand
Faster production; ideas from employeesNeeds reliable suppliers and trained staff
Real-world example Toyota developed JIT and Kaizen; Maruti Suzuki applies the same ideas, with suppliers located close to its factories.
Inventory

Why hold inventory: to meet unexpected demand, avoid stopping production, and benefit from bulk discounts. How much depends on: cost of storage and money tied up, risk of running out, supplier reliability and delivery time, perishability, and seasonal demand.

🔒 Also in the full notes
Join to unlock the full notesAlready a member? Log in
📝 Practise this topic
Case Study 1 (Paper 1 style, 20 marks): Questions · Mark scheme 🔒 · A* answers 🔒
Case Study 2 (Paper 2 style, 20 marks): Questions · Mark scheme 🔒 · A* answers 🔒
All Unit 4 topics4.2 Technology and Production of Goods and Services →