Definition: Zero-based Budgeting or ZBB is an analytical budgeting method where the preparation of a budget begins by assuming the base as zero. Here, the complete process starts from scratch and is very basic. In 1962, Peter Phyer introduced this approach of ZBB. It turned out to be an excellent tool in the field of management. This approach uses Cost-benefit analysis and … [Read more...] about Zero-based Budgeting
Budgetary Control
Definition: Budgetary Control is a system of control that focuses on cost management with the help of budgets for Departmental and Organizational levels. It begins with budget preparation as per employees' responsibilities, thereafter comparing the actual and planned outcomes and ends with variance analysis followed by a review. In brief, we can understand it as a road map … [Read more...] about Budgetary Control
Flexible Budget
Definition: Flexible budget is the one that changes with the level of Activity/Output rather than for any specified activity level. It includes the preparation of multiple budgets that depict budgeted costs for various activity levels. The flexible budget supersedes the limitations of a fixed budget. Because it is a practical approach that is suitable for dealing with … [Read more...] about Flexible Budget
Total Quality Management
Definition: Total Quality Management (TQM) is a modern production tool that is focused on providing premium consumer satisfaction through constant improvement in the organization's processes. Simply, serving customers at their best by maintaining quality at each organizational level. The total in TQM refers to all the activities undertaken toward customer … [Read more...] about Total Quality Management
Total Productive Maintenance
Definition: Total Productive Maintenance (TPM) is a lean maintenance concept that maximizes effectiveness by continuous maintenance and improvements in the equipment. It is a combined effort made by the entire organization. TPM develop a maintenance-free framework by identifying the losses and eliminating them. It will lead to a considerable decrement in the maintenance … [Read more...] about Total Productive Maintenance
Maintenance Planning
Definition: Maintenance Planning is a controlling function that formulates strategies to keep the Capacities and Facilities as per intended working conditions up to their useful life. It helps Minimize Costs, achieves Higher Production Efficiency, and reduces Ideal Time. The manufacturing units produce final products using their resources and assets. These assets are the … [Read more...] about Maintenance Planning
Aggregate Planning in Operations Management
Definition: Aggregate Planning in Operations Management determines production and resource allocation strategies to meet the uncertain and fluctuating future demand at minimum production cost for the Intermediate Time Horizon. Here, the word 'Aggregate' signifies the product lines and families. And 'Planning' covers the series of activities to be taken in order to meet the … [Read more...] about Aggregate Planning in Operations Management
Consumer Decision Making Process
Definition: The Consumer Decision Making Process is the sequential interrelated steps explaining the approach of the consumers in making buying decisions. Also, it involves an in-depth analysis of the consumers’ purchase behaviour. We can also refer to it as the Buyer Decision Making Process. It is the traditional model depicting the process of Consumer Decision Making. … [Read more...] about Consumer Decision Making Process
Consumer Decision Making
Definition: Consumer Decision Making is the process of choosing products and services for consumption among various alternatives. It is the initial step in understanding consumer behaviour. And a base for marketers to devise customer-oriented strategies. Following are some of the common decisions taken by the consumers in the daily life: - What to buy? How much to … [Read more...] about Consumer Decision Making
Assembly Line Balancing
Definition: Assembly Line Balancing (ALB) optimizes the mass production process by dividing tasks into workstations and allocating equal processing time to each one without any delay. The assembly line in which the workstations have equal processing time with less or no ideal time is said to be a perfect one. It must be balanced in order to ease the manufacturing … [Read more...] about Assembly Line Balancing