Production processes
I shall be examining the different methods of production and manufacturing. This essay will show in a certain degree of depth, how the types of production are used and which are more efficient for a business organisation. I must produce clear evidence that the choice of manufacturing methods depends on the product being made and I must show the various factors that affects the choice manufacturing methods.
Production is the total output made by as business. For production to occur, it is vital acquire certain inputs. Inputs are resources or raw materials, which are processed in order to create input. These take the form of capital equipment, materials and human resources. These inputs are transformed in the productive process. The process consists of four forms;
* Extraction (Mining raw material e.g. coal)
* Analytical techniques
* Fabrication
* Synthesis
Below is a diagram which shows the transformation id the inputs produces an output, this will take the form of goods or services.
Fig.1.
People Goods
Machines and
Materials INPUTS- THE CONVERSION PROCESS services
Information
Money
Examples of production in the primary industry are the use of land and tractor to grow cabbages. In the secondary sector the use of wood glue screws, labour, drilling and cutting resources to produce furniture. And in the tertiary sector services such as mortgages, accounts etc.
There are various types of production processes; I shall b examining the main five processes used by today's organisations. Five types of process can be indented as:
* Project production
* Jobbing production
* Line production
* Batch production
* And continuos flow production
The choice of production that a business may chose to use will be determined by the financial resources that the firm has and the extent to that it seeks to produce a differentiated product!
Project production is mainly used in large scale projects made to customers requirements for example such as a an oil tanker. The product is unique and is manufactured by skilled labour workers using flexible resources. Due to the detail required to make the product, considerable planning is required for assurance of product guarantee as there is a lot at stake, as the product is unique and has a lot of financial backing. Quantitative techniques such as network analysis are essential to successful management of the project. It is normally necessary to break down the overall project in to manageable sub tasks, many of which are subcornated.
Jobbing production mainly refereed to, as job production is similar to project production, as they are both concerned with the production of unique goods, which are made to order. Project production mainly produces large-scale goods whereas in job production the items are small scale ones and are made in a workshop, example; such as made to measure three piece suits. Machinery carry out the same processes as a skilled workers may, the product moves from one workstation to another, were different objectives are met. Job production is a method of organising production where a series of different products ...
This is a preview of the whole essay
Jobbing production mainly refereed to, as job production is similar to project production, as they are both concerned with the production of unique goods, which are made to order. Project production mainly produces large-scale goods whereas in job production the items are small scale ones and are made in a workshop, example; such as made to measure three piece suits. Machinery carry out the same processes as a skilled workers may, the product moves from one workstation to another, were different objectives are met. Job production is a method of organising production where a series of different products are made to satisfy customer requirements. A lot planning is undertaken for each customer, as his or her order is completely different from any other. Job production involves more skilled work, there are likely to be less preparative activities, therefore meaning the purchase price of the product is likely to be fairly high.
There are a number of advantages that a business can gain from using job production. The Duties mainly carried out by employees require a lot of skill, knowledge and expertise. Work will be more demanding and motivating. As many production processes do, they all have a negative set backs, in this case labour costs will be will be fairly high as the required workforce are skilled and demand high wage packets. Also production tends to be labour intensive, also cost of sales will be high as customers demand the best quality, as they are not purchasing in bulk, the organisation is unlikely to make as much profit.
Batch production, this is the manufacture of different versions of the same basic product in bulk or batches. For example in different colours etc"however production is not continuos, the relatively short production runs result in a higher unit cost than would be the case if production was continuos".
Batch production is a common method of organising production production in today's organisations, which falls between job production and flow production. The benefits that batch production has on a business is the even though larger quantities of products are being produced, compared with job production, there is still flexibility. This is due to each batch satisfying a certain segment of the market. For example a Nintendo 64, in pink designed to be sold to young girls, pink is used to attract potential pulse purchases. This production method doesn't involve employees completing products single-handed, it involves the whole organisation undertaken various task.
Batch production has a moderate level of planning and co-ordination, these are required. Machines or employees may be idle, wailing on different stages of the process to be completed. Machinery may have to be serviced etc, therefore causing delays.
Fig.2. Production processes-matrix
Job
Batch
Flow
Quantity of products:
One of item
Group of products produced together.
Large quantities
Variety of products:
Very flexible
Can vary from batch to batch
Not flexible
Flow production is also regarded to as a process of producing a large quantity of products. It is also a keen method of organising production. This methods takes line production to its ultimate limit, dedicated plant is used to manufacture a single product on a continuo basis for example over 24hrs a day. It is mainly used for oil refining etc. Flow production is also known as mass production, and this is a method of arranging production such as a motorcar passes through a sequence of predetermined operations an d processes which constitute a production line or assembly line, production is organised so that different operations can be carried out, shortly after one another, in a process circle. The main objective of flow production is also to produce in mass. Flow production is where production takes place as a continuous process. The product flows from one process onto the next. This will usually happen where the product is standardised, and can be made using a production line method.
Line production id best understood by the example of assembles line manufacture of motor vehicles or electrical goods. Specialist machinery will be used in the process and because of the high capital investment required, it is essential to active a high level of utilisation. This assures a high level of sales of a fairly standard product. Line production has a method of using undiffernated sratergy of marketing. whereas job and batch production suggest that the product is made to meet the wants and need of customers in certain areas of the market. There are a number of skilled workers that are required for this process. The layout of the workshop is set in way in order to assure low costs and time.
It is vital to a company to ensure they are efficient. There are number of different markets, if a firm in a competitive market has suffered in the past from 'over capacity'. They therefore have to keep a careful eye on how their costs compare. One of the ways they may do this is to look at the level of average costs. The average cost is calculated as follows:
AVERAGE COST = TOTAL COST
OUTPUT
This gives the cost per unit of production, and so one measure of efficiency. Another measure would be to look at how much each particular factor of production (labour / capital / land) manages to produce. In this way we can measure productivity. For example to calculate labour productivity:
LABOUR
PRODUCTIVITY = OUTPUT (in a certain time)
NUMBER OF EMPLOYEES
This can be a useful measure but does need careful interpretation. For example, who exactly do you include - all employees, or just those directly involved in production? You also have to ensure that you always calculate it consistently or it will be very difficult to draw useful conclusions.
Labour intensive - this is where the proportion of labour used in producing the product is relatively high. Labour will usually be used instead of capital.
Capital intensive - this is where techniques are used to produce that use relatively more capital than labour. Many industries are now like this including the car and steel industries.
The technique that a company uses depends on several things:
The size of the company - small companies are often not in a position to afford expensive capital equipment. Even if they could they are often not able to use it enough to justify the cost.
The cost of the factors of production - even though a machine may be available to do the job, it may not be worthwhile if the amount of labour required costs less. Firms therefore look carefully at the cost of labour and capital before deciding how much to use.
The product - some products lend themselves better to being produced by capital than others are. Mass-produced everyday items are far more likely to be produced in a capital-intensive way, whereas services and products with a more individual slant are more likely to be produced using a large proportion of labour.
There are various factors, which affect the choice of production processes; organisations are always situated with problems between alternative production factors. An example might be for a carpenter to purchase any necessary tools before he or she carries out any tasks. Business must take into consideration that they do not necessarily have the choice with regard to the adoption of different production methods. However, firms may be influenced to purchase new machinery in order to keep up with rivals, or competition in the area. The method of production used may depend on various factors.
Market price might be a major influence on the choice of production, of a firm, due to the overall demand for the product for example confectionery, hammers etc be produced using flow or batch production, as the demand is high. The market size will also depend on how much competition there is.
Below is a list of the sources that I had to use in order to produce this essay concerning production process and the factors, which effect its efficiency. I used a number of levels textbooks and the World Wide Web.
* Business studies, Dave Hall
* Business studies, Stephen Barnes
* Business studies, Collins
* www.bized.ac.uk