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Production Methods

During the production process,
the business takes raw materials and components, and converts them into the
required products. At each stage, value is added to the product, creating
added value.

Labour Intensive –  When the majority of the
production costs come from labour. This is usually the case in highly-skilled
professions. Most personalised, job producing businesses will be labour
intensive.
 

Capital Intensive – These
businesses require high 
capital investment, including mass producing firms.
Their main costs come from the machinery, raw materials, etc.
 

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 Job Production

The whole process is seen
as one operation, as the operative must complete the one task before they
can move on to the next job. The same person or team of people will work on it during
this entire time. The business is able to tailor the needs of the
customer to the final product, making it
unique.This is when the product is made  one item at a time as customers request it, and therefore are only sold individually. Often a few similar units will be made at the same time. 

 

 

ADVANTAGES

DISADVANTAGES

The
product exactly meets the customer
s requirements, meaning
that it is
higher quality

 This is more expensive and labour intensive

Inspection
and supervision are easier

Production
is more
time consuming

The customer can make alterations to the design
during the process, increasing their
flexibility

The
business will have a
longer working capital cycle

Uniqueness
results in
added value to the product

Since they
are not producing in bulk, they cannot really benefit from
economies of scale

Requires
teamwork, helping employee satisfaction and
motivation

 

 

Batch Production

In this type of production, a group of
similar products
are made simultaneously. A new batch
can be made once the first one is complete. The business may create
multiple components, and then assemble them to create the final product.
This is called intermittent production because there are multiple steps
that must be done, which are held as work-in-progress whilst they
wait for the final assembly.

  

ADVANTAGES

DISADVANTAGES

The same
machinery can be used, which means that they economise on it
 

There is
less flexibility as the batch cannot be stopped once it has started

Can
respond to customer orders faster by bring work-in-progress to final
production stage

There are
greater storage costs for work-in-progress

Better economies of scale

Employees
may become bored with producing the same things all the time.

Easier to
calculate costs

 

Allows for
specialisation of the workforce

 

There is
still enough variety to suit a range of customer needs

 

Making cookies!!

Flow Production

This is when the production
process involves passing parts along the stages of production ina regular flow.
At each stage, more is added in a
continuous process. There is
no delay between any of the stages. The products are usually standardised.
However, this is only effective if the
demand is also continuous, otherwise
there is like to be overstocking. There must also be good planning
to ensure that the production runs smoothly, with enough labour
and materials available.

Line Production

This is a type of flow
production. The products are assembled along a conveyor belt until there
is a finished product.

Mass Production

This is production on a large scale, with a
single stage to the production process. The products tend to be standardised.
There are good
economies of scale due to the
high level of productivity. The business can also be highly specialised with
the specific equipment.

   

ADVANTAGES

DISADVANTAGES

Less waste as this employs just-in-time techniques

The work
can easily become boring and
repetitive

Lower
labour costs
as robots and good planning are used

Breakdowns or delays will have a huge impact on productivity

Quality can be easily detected by deviations in the line and controlled

Almost no
flexibility
, so the customers’ tastes are not
always
met.

Less
work-in-progress
, therefore lower storage space and
there is less handling

Operations
must
halt for problems to be rectified

Faster
conversion
from raw materials to sales

Lots of storage due to the large production

Average
costs
are considerably lower 

High set
up costs
for the business

 

Future trends – robot workers

The 5 Ms of Productions

Related to the factors of production (land, labour, capital and entrepreneurship), operations management has it’s own dandy list; the 5 Ms:

  1. Manpower
  2. Money
  3. Machines
  4. Management
  5. Materials

ĉ

Jeremy Bracken,

Nov 10, 2014, 9:11 AM

ĉ

Jeremy Bracken,

Aug 29, 2012, 11:15 AM

ĉ

Jeremy Bracken,

Oct 31, 2016, 11:54 AM

ĉ

Jeremy Bracken,

Aug 29, 2012, 11:15 AM

ĉ

Jeremy Bracken,

Aug 29, 2012, 11:15 AM

ĉ

Jeremy Bracken,

Oct 27, 2016, 6:10 AM