Production Flashcards
Production
The process by which products are manufactured- converting inputs(FOPs) into outputs(goods and services)
Factors of production
Land (where materials are extracted from), Labour (people and their skills), enterprise (entrepreneurs organise the other FOPs), Capital (equipment, machinery)
Job production
A method of production which a product is suplied to meet the customer’s needs. For example, a personal trainer setting a specific diet plan for a client. Tend to be ‘one-off’ batches.
Advantages of job production
Can be used by small businesses to charge higher prices for personalised goods which’d usually be higher quality. Can be used as a USP.
Flow Production
Involves continuous movement of an item from one stage of production to another.
Advantages of flow production
Allows larger output and (if there’s demand) they can be sold in large numbers
Allows specialisation
Cheaper per unit- equipment costs spread over millions of units
Disadvantages of flow production
Cost of equipment to high for some businesses
Risky: a business could invest in the equipment but demand could fall
Lacks flexibility: can produce similar products, some new technology allows custom products for customer orders, but not as flexiable as job production
Specialisation can cause employees to become bored with their role and decrease motivation
Specialisation
Workers each focus on one stage of productionand become more efficient at it through repitition. Speeds up production and makes workers more productive and training easier.
Efficiency
How well a business uses it’s resources to produce. More efficient businesses use fewer inputs per output. Can be measured in cost per unit.
Efficiency depeneds on…
Employee motivation, quality of suppliers, investements in machinery and technology, production method
Lean production
Aims to minimise risk. Waste is inefficient and reducing wate will reduce costs.
Waste can be…
Products that have to be thrown away because they exceed demand, wasted time, faulty products which need to be remade, stock being damaged or stolen while in storage
Just in time production
Holding as little stock as possible so it won’t be wasted if there’s a lack of demand, stock only ordered when there’s a customer. This means that suppliers have to be fast and reliable so the business can respond to customers in time
Kaizen
Means ‘continuous improvement’, meaning that employees’ll discuss how they can improve at the end of every day. Small improvements build up over time and have large impacts on the business.
Lean production and employees
Needs good staff motivation: disruption such as strikes would be very disruptive due to no stocks, kaizen needs employees actively trying to improve.
To avoid waste employees need to check the quality of every stage of the process meaning they need to know what to check for and be willing to send back faulty work.
