Production

Production

Key Terminology:

  • Production: This is the process of converting resources into goods or services.
  • Productivity: A measure of the efficiency of production often measured as the rate of output per unit of input.
  • Specialisation: Assigning workers to specific, detailed tasks to enhance productivity.
  • Division of Labour: The breaking down of the production process into small parts with each worker allocated to a specific task.

The Production Process

  • The production process involves inputs (resources), outputs (goods or services), and the transformation process.
    • Inputs include raw materials, labour, and capital.
    • The transformation process is where inputs are converted into outputs.
    • Outputs are the end products or services.

Types of Production

  • There are three main types of production: Job, Batch and Flow Production.
  • Job Production: Involves producing a one-off or small number of customised products. Often high quality and high cost.
  • Batch Production: Involves producing a set number of identical products before switching to a different product. Allows for economies of scale but there may be downtime between batches.
  • Flow Production: Involves continuous and progressive manufacturing of identical products. High volume and low cost per unit but requires significant initial investment.

Improving Productivity

  • Businesses can improve productivity in several ways:
    • Investing in new technology to speed up the production process.
    • Training employees to enhance their skills and efficiency.
    • Motivating workers to increase their effectiveness.

Quality Control and Quality Assurance

  • Quality Control: A process that ensures products and services meet specific standards or benchmarks. Often involves inspection at various stages of the production process.
  • Quality Assurance: A method of preventing mistakes or defects in manufactured products and avoiding problems when delivering products or services to customers. Emphasises the quality of process over the inspection of the finished product.

Lean Production

  • This is an approach to management that focuses on reducing waste (lean thinking) while ensuring quality. Techniques include:
    • Just-In-Time (JIT) Production: Here, materials arrive just when they are needed in the production process, reducing the cost of holding inventory.
    • Kaizen: This is continuous improvement, where employees are encouraged to keep finding small ways to improve the process.
    • Cell production: This is a form of team work where the production process is divided into small self-managed units (cells), each responsible for a significant part of the finished article.

Remember to review all these points regularly to help strengthen your understanding of the ‘Production’ aspect of Business Operations.