When a firms design capacity is less than?

When a firms design capacity is less than?

When a firm’s design capacity is less than the capacity required to meet its demand, it is said to have a negative capacity cushion.

Is to find the capacity level of resources that best supports a firm’s competitive strategy?

The objective of strategic capacity planning is to determine the overall capacity level of capital intensive resources (including facilities, equipment, and overall labor force size) that best supports the company’s long-range competitive strategy.

When deciding to add capacity to a factory which of the following need to be considered?

Question: When Deciding To Add Capacity To A Factory, Which Of The Following Are The Major Consideration? Select All The Correct Answers Internal Capacity Changing Use Of External Capacity Learning Curve Maintaining System Balance Capacity Flexibility The Frequency Of Capacity Additions Immediate Product Demand.

What is a capacity cushion and why would a firm have one?

What is a capacity cushion and why would a firm have one? The capacity cushion is the reserved capacity that a firm has to satisfy an unexpected increase in demand or temporary breakdown in production capacity. A firm must have one so that it is able to satisfy its customers when there is a sudden spurt in demand.

When multiple products can be produced at lower cost in combination than they can be separately?

Economies of scope describe situations where producing two or more goods together results in a lower marginal cost than producing them separately.

What is the typical goal of applying EMV to capacity decisions?

What is the typical goal of applying EMV to capacity​ decisions? Maximize the expected value of the alternatives.

What does it mean for a firm to have an 80 percent learning curve?

What does it mean for a firm to have an 80 percent learning curve? A) Every time the cumulative output increases by 80 percent, the cost per unit will decline by 20 percent. Every time the cumulative output is doubled, the cost per unit will decline by 80 percent.

Why does the learning curve go down when productivity is considered?

Cost of input factors-lower costs of inputs such as raw materials and labor. Learning curves-Learning curve goes down the more you produce a product and productivity goes up. It can charge a higher price than the cost leader but it can also lower its prices because of its low cost structure.

What does it mean for a firm to have a 70 percent learning curve?

For example, a 90 percent learning curve indicates that per-unit cost drops 10 percent every time output is doubled. A 70 percent learning curve indicates a 30 percent drop every time output is doubled.

What does it mean for a firm to have an 80 percent learning curve every time the cumulative output is doubled the cost per unit will decline by 80 percent every time the cumulative output increases by 80 percent the cost per unit will decline?

This learning curve ratio of 80% means that every time output doubles, the average cost declines to 80% of the previous amount. The amount of production improvement in the manufacture of an article will determine the percentage of the learning curve.

Has recently introduced a new production method that will make the production of their medical devices more cost effective?

Heartbeat Industries has recently introduced a new production method that will make the production of their medical devices more cost-effective. low-cost input factors.

What must a cost leadership strategy accomplish to be successful?

Award: 1.00 point What must a cost-leadership strategy accomplish to be successful? It must increase the firm’s cost above that of its competitors while offering adequate value. It must reduce the firm’s cost below that of its competitors while offering adequate value.

How is a cost leader protected from threats from powerful suppliers?

How is a cost-leader protected from threats from powerful suppliers? It is more able to absorb price increases through accepting lower profit margins. What must a cost-leadership strategy accomplish to be successful? It must reduce the firm’s cost below that of its competitors while offering adequate value.

Which of the following best explains why a blue ocean strategy is difficult to implement?

Which of the following best explains why a blue ocean strategy is difficult to implement? It requires the combination of fundamentally similar strategic positions—differentiation and strategic innovation.

When a blue ocean strategy is successfully formulated and implemented investments in differentiation and low costs are no?

This preview shows page 20 – 23 out of 29 pages. When a Blue Ocean strategy is successfully formulated and implemented, investments in differentiation and low costs are not substitutes but complements.

What must a cost-leadership strategy accomplish to be successful quizlet?

What must a cost-leadership strategy accomplish to be successful? A. It must increase the firm’s cost above that of its competitors while offering adequate value.

What are the two ways to achieve differentiation?

A business will usually accomplish this by analyzing its strengths and weaknesses, the needs of its customers and the overall value it can provide. There are two main types of differentiation strategies that a business may carry out: a broad differentiation strategy and a focused differentiation strategy.

What are the disadvantages of differentiation strategy?

Cons of Differentiation Strategy

  • Nothing is guaranteed: Even if your product is superior in every way, your audience may not go for quality over price.
  • It’s all about perception: Perception is key here.
  • Resources can be strained: Differentiation strategy requires time, effort, and resources.

What is the major weakness of differentiation?

One weakness of using a differentiation strategy involves the challenge of changing the customer perception. Many consumers perceive the product as equivalent to alternative products offered in the marketplace at a lower price.

What is pros and cons strategy?

Using a simple “pros” and “cons” list encourages you to approach your decision objectively, without letting your “gut feeling” impact your choice. This method is particularly useful in group decision making, when team members favor a certain idea, point of view, or plan.

What are the pros and cons of differentiation strategy?

Advantages and Disadvantages of Product Differentiation

  • It creates additional value.
  • It develops brand loyalty.
  • It allows businesses to compete in different ways.
  • Revenue increases are not guaranteed.
  • The offering’s perceived value can decline.
  • It can strain resources.
  • Main competitors: Fleetwood, Jayco, Winnebago.

What are the main differences between a low-cost strategy and a differentiation strategy?

The two main strategies you can adopt as a business are that you focus either on costs or on differentiation. When you focus on costs, then you try to become a low-cost provider. When you focus on differentiation, then you look to compete by adding extra value to your customers that they won’t find in your competitors.

What companies use a low cost strategy?

The obvious example of a low-cost leadership business is Walmart, which uses a top of the line supply chain management information system to keep their costs low and, consequently, their prices low. Walmart’s system also keeps shelves stocked almost constantly, translating into high profits.

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