Production of goods and services Flashcards
What is production?
Production is the provision of a good or service that satisfies customer wants and needs
What is productivity?
it’s how a business can measure it’s efficiency or the output/ quantity of input
how productivity can be raised?
by using fewer inputs to produce same level of outputs or using same level of input to produce higher level of output
How to increase productivity
Improve the quality of the product
Motivate the employees effectively
replace the employees with machines
Benefits of productivity?
Fewer input needed for the same level of output
lower cost per unit or average cost?
Why businesses hold inventories?
to maintain the production and satisfy customer demands quickly
What is Lean production?
it’s techniques used by the business to cut down waste of resources to increase efficiency
what is buffer inventory level?
is the inventory held to deal with the uncertainty in the customer demand and delivered supplies
what are the types of waste in production?
Overproduction
Waiting
Transportation
Motion
Overproduction?
is producing goods before being asked by the customers
Waiting?
the products are not moving anyway
Transportation?
moving the products around unnecessarily
Motion?
The employee stretching his body
Benefits of lean production?
less storage of raw materials
quicker production
better use of equipment
cutting out some processes
How can lean production achieved?
Kaizen
Just in time inventory control
Cell production
Advantages of Kaizen?
Increased productivity
Work in progress reduced
less space needed for production processes
what is just in time inventory control?
it’s raw materials just delivered and used in production process
Advantages of just in time inventory control?
warehouse space is not needed
reduced costs of holding inventory
finished goods are already sold so more money entering the business quickly
What is cell production?
Cell production is where production is divided into separate self contained units
Methods of cell production?
Job production
Batch production
Flow production
What is Job production?
Is where products are made specifically to order
Advantages of job production?
more suitable for personal services
the product meets the exact requirements of the customers
the employees have more varied jobs
Disadvantages of job production
skilled Labour is used so costs are raised
costs are high because its labour intensive
production may take longer time
What is Batch Production?
is where similar products are made in blocks or batches
