Productivity & Investment Flashcards
Production : definition (as defined by economists)
Any economy activity which satisfies human wants. Production is a process by which businesses provide goods and services required by customers in a particular market.
Production process : diagram
Inputs (eg land, labour, machinery)——-> transformation process ————> outputs (eg finished goods, services)
Job production : definition
A firm produces a one off product for a specific customer. Eg tailor making fitted suits.
Batch production : definition
Occurs when a number of identical products are produced in a batch. Often sold to a range of customers. Eg bread made in a bakery.
Flow (mass) production : definition
Occurs when production takes place as a continuous process. Produces along an assembly line with components and parts added at each stage. Eg bar of chocolate.
Cell production : definition
Groups work together into multi skilled cells, each taking responsibility for production of a particular product or part of a product. Eg doc martens
Lean production : definition
Production technique which attempts to prop Duce goods and services while stripping out waste. Entails doing more work with less labour, less time, less space, less inventory and lower costs. Eg toyotal
Job method : brief breakdown
Low technology jobs : here the organisation of the product is simple, with skills and equipment easily obtainable. (Hairdressing)
High technology jobs : greater complexity. High management or project control needed. Essential features are ; clear definitions of objectives, decision-making process eg film production.
Batch method : brief breakdown
Requires that work for any task is divided into parts or operations.
Each operation is completed through the whole batch before the next operation is performed.
This method makes it possible to achieve specialisation of labour.
Capital expenditure can be kept lower although careful planning required.
Main aims are to ; concentrate skills and achieve high equipment utilisation.
Flow methods : brief breakdown
Aims are ; improve work and material flow, reduced need for labour skills, added value/ complete work faster.
There must be substantially constant demand.
The product and/or production tasks must be standardised.
Materials used in production must be to specification and on time.
Each operation in production flow must be carefully defined.
The output from each stage of the flow must conform to quality standard.
Cell production : brief breakdown
Each ‘cell’ is responsible for a significant part of the finished article, rather than each person only carrying out one very specific task, team members are skilled at a number of roles ie job rotation.
Benefits of cell production: communication, multi skilled workers, increased motivation(from teamwork), quality improvements.
Downsides of cell production: investing in new materials, not attainable for smaller scale production lines.
Lean production: brief breakdown
Aims to cut costs by making the business more efficient and responsive to market needs.
Cuts all activities that don’t add value to production process.
Advantages: reduce defects, lead time reduced, time saved.
Disadvantages: defining waste is subjective, dependence on external factors efficiency, long term commitment required.
Productivity : definition
An attempt to measure the efficiency with which a business converts its resources into goods or services.
Or
A measure of the amount of output per unit.
Productivity : formula
Productivity = output / input
How to boost productivity
Increase output using the same number of inputs.
Reduce inputs but maintain eel of output.
Increase outputs by more than the increase in inputs.
