Chapter 37- Production, Productivity and Efficiency Flashcards
Production
Takes place when raw materials are changed into products.
Primary industry
use of tractor to grow cabbages
Secondary industry
use of wood, plastic, glue, screws, labour to manufacture goods.
Tertiary industry
would include services such as bank mortgages, current accounts etc
Job Production
Involves the production of a single product at a time. Used when orders for products are small such as ‘one-offs’
Advantages:
• Quality is high because workers are skilled
• Workers are well motivated because work is varied
• Products can be custom made
• Production easy to organise
Disadvantages:
• High labour costs due to skilled workers
• Production may be slow- long lead times
• Wide range of specialist tools may be needed
• Generally an expensive method of production
Batch production
Used when demand for a firm’s product or service is regular rather than ‘one-off’. E.g. furniture factory, where batch of armchairs is made to particular design. Production is divided into small operations, once one operation is completed the whole batch is then carried onto the next operation.
Advantages:
• Workers are likely to specialise in one process
• Unit costs are lower because output is higher
• Production is flexible since different orders can be met
• More use of machinery is made
Disadvantages:
• More complex machinery may be needed
• Careful planning and co-ordination is needed
• Less motivation because workers specialise
• If batches are small, costs will still be high
• Money may be tied up in work-in-progress
Flow/Mass production
Is organised so that different operations can be carried out, one after the other, in a continuous sequence. E.g. vehicles move from one operation to the next, often on a conveyer belt.
The main features of flow production are:
• The production of large quantities
• A simplified or standardised product
• A semi-skilled workforce, specialising in on operation only
• Large amounts of machinery and equipment
• Large stocks of raw materials and components
Continual flow production
Clothing continually passed through series of processes.
Repetitive flow production
Manufacture of large number of the same product such as plastic toy parts or metal cans.
Advantages:
• Very low unit costs due to economies of scale e
• Output can be produced very quickly
• Modern plant and machines can allow some flexibility
• Production speed can vary according to demand
Disadvantages:
• Products may be too standardised
• Huge set-up costs before production can begin
• Worker motivation can be very low- repetitive tasks
• Breaks in production can be very expensive
Cell production
Involves dividing the workplace up into cells. Each cell occupies an area on the factory floor and focuses on the production of ‘product family’.
This is a group of products which requires a sequence of similar operations. Inside one cell, machines are grouped together and a team of workers sees the production of a good from start to finish.
Advantages:
• Floor space released as cells use less space than a linear production
line
• Product flexibility improved
• Lead times cut
• Movement of resources and handling time is reduced
• Less work-in-progress
• Teamwork is encouraged
• Safer working conditions and more efficient maintenance
Productivity
Output per unit of input per time period
Factors that influence include: Specialisation Division of labour Education & Training of workforce Motivation of workers
Is the amount of output that can be produced with a given output of resources.
Labour productivity
Output per worker per period of time.
Capital productivity
Done by dividing output by the amount of capital employed in a given period.
Factors influencing productivity:
• Specialisation and division of labour- businesses can specialise
production for one type of good + workers becoming specialised in
certain tasks and skills. Division of labour can also be used where
people are allowed to concentrate on a limited range of tasks.
• Education and training- training can be provided by work to increase
productivity as well as the gov investing in education by providing
equipment for schools or quality of education.
• Motivation of workers- motivated workforce = higher productivity.
Workers can be motivated through financial incentives such as
bonuses or other incentive such as job rotation where the employee
can rotate round to different jobs, meaning variation and higher
motivation.
• Working practises- are the methods and systems that employees
adopt when working, if changed could motivate.
• Labour flexibility- more flexible by (training employees to do different
jobs/flexitime/shift work) = factory/shop/business can work efficiently
all the time = higher productivity.
• Capital productivity- better tech or more capital intensive = more
efficient = higher productivity.
Introducing standardisation
Involves using uniform resources and activities or producing a uniform product. Can be applied to tools, components, equipment, procedures. Bulk purchases can be made = efficient HOWEVER this is somewhat inflexible, making customisation more difficult and design more challenging.
