2.3 Factors Affecting Choice Of Production Method- Operations

Question 1

The nature of the product

Answer 1

Whether it lends itself to fully automated production eg kitchen appliances (flow), needs to be differentiated (batch), whether it is a ‘one off’ eg wedding cake (job)

Question 2

The size of the market/quantity of goods required

Answer 2

Where the product is for sales in the mass market, flow production is more appropriate. Products being sold in a ‘niche’ market are more suited to job production. Batches can be larger or small in size so could be used in markets of different sizes.

Question 3

The size of the business

Answer 3

Small businesses may not have the capacity to install lots of machinery and equipment for flow production and may prefer to market themselves on offering a personalised service. Larger businesses are better placed to accommodate mass production using flow production methods.

Question 4

Finance available

Answer 4

Often but not always linked to the size of the business, whether the business can afford the initial investment necessary for capital intensive or flow production. Sometimes even large businesses may find it difficult to raise the finance this if the economic situation is poor eg high interest rates or a credit crunch.

Question 5

Technology available

Answer 5

In order to automate a process and therefore move from job, through batch to flow, the technology must have been developed that would allow workers to be replaced by machines. Developments in robotics are continually moving forward the process of replacing workers with machines.

Question 6

Skills of the workforce

Answer 6

A highly skilled workforce may lead to the choice of labour intensive method of production using job or batch methods.a poorly skilled workforce may lead to the use of capital intensive/ flow production methods (unless the business is willing to invest in training)

Question 7

The quality standard required

Answer 7

Where precision and consistency are required it may be more appropriate to use capital intensive production methods. Where closer scrutiny of the overall quality of the product is required, labour intensive methods may be more appropriate.