Chapter 5.2 Flashcards
What are the 4 different production methods businesses might use?
-Job production
-Batch production
-Mass/flow standardised production
-Mass individualised customisation
What is job production?
Job production is the production of a special “one-off” product made for one individual, such as a wedding cake
Job Production
3 ADV and 3DIS
ADV
-Mark-up is usually high
-Production process is motivating
-Customers get exactly what they want
DIS:
-Time consuming
-Expensive since it requires skilled workers
-Lack of customer knowledge can lead to product failing reflecting badly on the brand
What is batch production?
Batch production is the production of a group of identical products such as pizzas
Batch Production
3ADV and 2 DIS
DIS:
-Customers can choose what they want
-Businesses can achieve economies of scale
-It can help deal with unexpected orders
DIS:
-Businesses need to hold large stocks in case of demand increase
-Sizes of batches depend on machinery or labour assigned to them
What is mass/flow production?
Mass/flow production is the production of a large quantity of identical products such as identical cars
Mass/flow production
3ADV and 2DIS
ADV:
-Businesses can achieve economies of scale
-Once system is set up it need little to no maintenance
-Labour costs are low since workers are unskilled
DIS:
-Set up costs are high
-Breakdowns are costly
-Demotivating
Job Production
-Setup time
-Cost per unit
-Machinery
-Labour
-Production time
-Stock
-Setup time is long since
-Cost per unit is high
-Machinery is flexible
-Labour is skilled
-Production time is long
-Stock is low
Batch Production
Setup time
Cost per unit
Machinery
Labour
Production time
Stock
-Setup time is medium
-Cost per unit is medium
-Machinery is mixed but based on general purpose machines
-Labour is semi-skilled
-Production time is medium
-Stock is high
Mass/flow production
Set up time
Cost per unit
Machinery
Labour
Production time
Stock
-Set up time is long
-Cost per unit is low
-Machinery is general purpose
-Labour is unskilled
-Production time is short
-Stock is high
What is the implication for HR for changing the production method?
-Workers need to be hired, fired, trained
-Re-organizing the roles and responsibilities of workers can be time consuming
What is the implication for Marketing for changing the production method?
-Brand image can change
-Changes in cost of production could change prices
What is the implication for Finance for changing the production method?
-Stock control will change
-Financing will be needed
-Interruption of current production
What should be kept in mind when changing the production method?
GATE
-Government regulations
-Availability of resources
-The target market
-Existing technology
