Production

of goods and services

CHAPTER 17
Labor Intensive: Industry or process where a larger
portion of total costs is due to labor
• Food processing (e.g. ready meals)
• Hotels & restaurants
• Fruit farming / picking
• Hairdressing & other personal services
• Coal mining
Capital Intensive: Industry requiring large sums of investment in
purchase, maintenance, and amortization of capital equipment

• Oil extraction & refining

• Car manufacturing
• Web hosting
• Intensive arable farming
• Transport (airports, railways etc.
 Operation department of the factory , What it does?
• Factory Manager
• Purchase Manager
• Research & Development Manager
 How Increased Improve
productivity help the Employees
Motivation
business
Improve Introduce new
• Increased Out put Quality Technology
• Lower Cost per unit Control
• Less number of worker How to
require to do the job increase
• Higher wages may results in Productivity
Use Improve
Higher motivation automation in inventory
the production Control
Process

Train the staff

Buffer stock/inventory a supply of inputs / Stock held as a
reserve in case there are future demand and supply fluctuations
What is waste then?
 Lean Production

Just in Time
Kaizan Inventory Cell Production
Control
A Japanese business philosophy of
continuous improvement of working
practices, personal efficiency & productivity.
• Kaizen Increase productivity
• Reduce the amount of space needed for the production process
• WIP is reduces
• Improve layout of the factory floor and may allow some jobs to be combined, they
freeing up employs to carry out some other jobs in the factory
Just in Time Inventory Control
What is Just in Time Inventory Control
• JIT helps to reduce the inventory level
• Improve quality
• Reduce space required
• Lower production Cost
• Increase productivity
• Increase Machine and labor utilization
• Greater Flexibility
CELL PRODUCTION
Cell production is a form of team working and helps ensure worker
commitment, as each cell is responsible for a complete unit of work,
which Herzberg would view as part of job enrichment.
Cell production has the flow production line split into a number of self-
contained units. Each team or ‘cell’ is responsible for a significant part of the
finished article and, rather than each person only carrying out only one very
specific task, team members are skilled at a number of roles, so it provides a
means for job rotation.
 Methods of
Production

Batch Flow
Job Production
Production Production
 JOB PRODUCTION
Job production involves firms producing items that meet the specific
requirements of the customer. Often these are one-off, unique items such
as those made by an architect or wedding dressmaker. For an architect,
each building or structure that he designs will be different and tailored to
the needs of each individual client.
• Hairdressers
• Tailoring
• Painting and decorating
• Plumbing and heating repairs in the home
• Film production
• Large construction projects (e.g. the Millennium Dome)
• Installing new transport systems i.e Riyadh Metro
JOB PRODUCTION
 BATCH
PRODUCTION

A manufacturing process in which components or goods are produced in groups

(batches) and not in a continuous stream
or we can say that Batch production occurs when many similar items are produced
together. Each batch goes through one stage of the production process before
moving onto next stage
BATCH PRODUCTION
FLOW PRODUCTION

Large quantities of same products are produced continuously.

WHEN BATCH PRODUCTION IS SUITABLE ?
Batch production system is used under the following circumstances:

1. When plant and machinery are flexible.

2. When plant and machinery set up is used for the production of item in
a batch and change of set up is required for processing the next batch.
3. When manufacturing time and cost are lower as compared to job order
production.
Factors affecting which method of production to use

• The nature of the product

• The size of the market
• The nature of demand
• The size of the business
 IMAPCT OF TECHNOLOGY ON PRODUCTION

• Automation
• Mechanization
COMPUTER AIDED DESIGN
 COMPUTER AIDED MANUFACTURING

Computer-aided manufacturing (CAM)

means using machines that are
controlled by computers. CAM is widely
used across all sectors of industry, not
just electronics.
 COMPUTER INTEGRATED MANUFACTURING
is the manufacturing approach of using computers to control the
entire production process. This integration allows individual processes
to exchange information with each other and initiate actions.
The computers that design the products are linked directly to the
computers that aid the manufacturing process.

3D Printing
a process for making a physical object from a
three-dimensional digital model, typically by
laying down many successive thin layers of a
material.
Impact of Technology integration on productivity &
efficiency in shops

EPOS
An electronic method of retail
checkout. Usually self-contained. The
system involved is typically capable of
all tasks of a store checkout counter:
payments by bank or credit cards,
transactions
verification, sales reporting, inventory
data updates. It also facilitates
customer service and inventory
availability
EFTPOS (electronic funds transfer at point of sale)
electronic funds transfer at point of
sale — is an electronic payment
system involving electronic funds
transfers based on the use of
payment cards, such as debit or
credit cards, at payment terminals
located at points of sale
 What's New ??
https://www.youtube.com/watch?v=NrmMk1Myrxc&t=37s
TYPICAL SELF CHECK OUT