5.2 Flashcards
What is job production?
This involves creating an individual product from start to finish, tailor made to meet specific needs of a customer. Typically, these products are one-off items.
Advantages of job production
- Quality of production.
- Highly motivated workers.
- Uniqueness of the product acts as a unique selling point (USP).
- Flexibility in the design and specifications of the product are possible.
Disadvantages of job production
- Labor intensive and therefore expensive
- Time consuming due to the varying and specific design requirements.
- Long working capital cycle between producing and selling products.
- Few economies of scale can be enjoyed since each product is unique
(i.e. produced on a small scale).
What is batch production?
This involves producing a limited number of identical products.
Work on each batch is fully completed before production switches to a new batch.
Advantages of batch production
- Economies of scale from machinery producing larger quantities.
- Specialization leads to increased productivity.
- Higher sales from a wider product portfolio, which gives customers greater choice.
- Products can still be tailored at relatively low cost
Disadvantages of batch production
- Inflexibility from difficulty in changing one batch to another onceproduction has begun.
- Storage costs are high since there is a lot of work in progress.
- Jobs are repetitive and may lead to boredom.
- High production costs from using equipment and machinery.
What is mass/flow production?
Mass: This is the manufacturing of large amounts of a standardized product.
It often involves the assembly of individual components.
Flow: This focuses on a continuous production process of manufacturing products that are standardized in large quantities. Flow production relies entirely on automated systems with very few workers required.
Advantages of mass/flow production
- Large scale output.
- Economies of scale through capital intensive methods.
- Standardized quality.
- Worker specialization leading to low defect rates.
- Low labor costs due to use of unskilled workers.
Disadvantages of mass/flow production
- Low levels of motivation due to boring repetitive work.
- Breakdowns will cause major delays.
- Little flexibility for change once production begins.
- Capital intensive and therefore very high set up, running and replacement costs.
- Large storage system is required for the large amounts of stock.
What is mass customization?
This occurs for businesses that produce large quantities of goods via batch or mass/flow production, but products can be tailored to a customer’s exact preferences.
