production business operations
DESCRIPTION
13.1 Objectives Describe the role of producers in the economy and the forms of production Differentiate among the various types of manufacturingTRANSCRIPT
PRODUCTION & BUSINESS OPERATIONS
CHAPTER 13 PRODUCTION & BUSINESS OPERATIONS 13.1 Objectives
Describe the role of producers in the economy and the forms of
production Differentiate among the various types of manufacturing
Production in the economy
Economy begins with production Consumers need products/services to
satisfy their needs and wants Role of producers 3 categories of
products used by people
Natural resources Raw materials supplied by nature Agricultural
products Crops and animals raised by farmers Processed goods
Products whose forms have been changed to increase their value and
usefulness to people Role of producers (cont.)
4 types of businesses that are responsible for production of
goods/services Producers Develop products to sell to other
businesses or consumers Extractors Find natural resources like
water, oil, coal, timber from the earth to be processed and used
Farmers Tend land to grow crops and livestock that are later sold
and processed Manufacturers Get materials from other producers and
convert them into products for sale to consumers Forms of
production Forms of production are All needed to make
Extraction & cultivation Processing Manufacturing All needed to
make products for customers Extraction & cultivation
Products are obtained from nature Makes sure that there is always
an available supply of natural resources Also makes sure that
crops, livestock, fish are available at all times Most basic form
of production processing Changing & improving the form of a
product
Not many products are used exactly how they are found in nature
Most are processed before being used Water, Cotton, Timber, Oil,
Cows manufacturing Combines raw materials and processed goods into
finished products Businesses and consumers use these Can be simple
(cabinetmaking) or complex (designing a computer microchip)
Manufacturing examples
One manufacturer might use steel and plastic to make many parts for
a snowmobile Another may purchase meat, vegetables and fruit from
farms to create frozen TV dinners Another might take timber from a
forest and process it into lumber and plywood for a construction
company to buy to build houses with Manufacturing processes
Usually, several manufacturers are a part of the total activity
needed to produce goods that we buy EX: a textile mill in North
Carolina buys cotton from an Alabama farm. It spins the cotton into
yarn and makes the yarn into fabric.A plant in Boston then colors
and prints the cloth.A clothing manufacturer in New York then buys
the cloth and makes it into jeans Working together is what fulfills
consumer needs Types of manufacturing procedures
3 main types of Manufacturing procedures Mass production Custom
manufacturing Materials processing Mass production An assembly
process that makes a large number of identical products using a
continuous, efficient procedure Sometimes called repetitive
production EX: automobile or bottling plants Every employee has a
specific task Training costs are lower and quality is higher Can
also be boring and decrease motivation Machines now assist with
many assembly lines Custom manufacturing Manufacturers make
products to meet specific needs and standards of
customers/businesses Products range from dentures to concert halls
Building a product for a specific use Work closely with the
customer to plan and design product to fit their requests May call
for unique materials/special process EX: bridges, buildings, piece
of airplane, special running shoe for particular athlete Materials
processing Changing the form of raw materials so they can be
consumed or used to make other products EX: oil companies refine
oil to form gasoline; mills process grain into flour and cereal;
digital editors convert audio/video files into films/CDs 2 types
Continuous processing Raw materials always move through equipment
to change them into a specific product to buy EX: milk Intermittent
processing Uses short production times to produce a certain amount
of change to a product. Machines are reset after each set. EX:
printer for special stationary ANSWER #1-4 ON PAGE 322 BEFORE
CONTINUING NOTES
13-1 assessment ANSWER #1-4 ON PAGE 322 BEFORE CONTINUING NOTES
13.2 objectives Identify the activities involved in production
planning Describe how manufacturing is organized Production
activities
Production processes are very complex Involves careful planning and
coordination Before a company can manufacture a product, it must
have the facilities and equipment to carry out the production It
must hire enough people to complete jobs It also must check all
finished products for quality and store them until they are sold
Product development Before production planning can happen, the
company decides what products it will produce You cant expect to
sell the same thing every year; New products will have to be
developed Product planning has 2 steps: New product research New
product design New product research Goal is to develop new products
that customers will like, meet their customer needs, and improve
current products offered Companies perform 2 types of research:
Applied research Studies existing products to develop improvements
or new uses of the product EX: auto manufacturers improve fuel
efficiency Pure research Research done with no product in mind;
instead, wanting to discover new solutions to problems EX:
scientists researching for cures to diseases New product design
Turning an idea into a product a company can sell and make a profit
from Designs are tested and best ones are chosen After engineers
build and test a model, the business determines all parts/materials
needed for final product Financial experts decide on what price to
set Make sure company makes money AND customers can afford it
Production planning If a company develops and tests a new product
idea, and they decide they want to proceed, they will then develop
plans to produce it Production planning includes 3 activities:
Develop a production process Collect production resources Select
and prepare production personnel Develop the production
process
Consists of the activities, equipment and resources needed to
manufacture a product If you are going to use mass production, this
is where you organize the assembly line Figure out which method you
are going to use is a key part of this step Collect production
resources
Order machines, tools required for production Business must locate
and organize a space to perform production activities Can either
buy a new building or remodel their current space to make bigger
and better Determine where materials will be coming from Identify
suppliers and make sure materials are delivered on time and at the
right price production personnel Estimates the number of employees
needed to complete production activities Determines skills required
of each employee Company will check their own employees first, then
hire and train new ones if needed Inventory management Inventory is
a detailed list of a companys materials, supplies and finished
products. Inventory management keeps track of the inventory &
resources needed for production Very important to manufacturing
because you cant produce products without your inventory Managers
keep a record of the supply and costs of resources used in
production After product is assembled, extra resources are moved
into storage or sold to customers Manufacturing procedures
Todays assembly line is quite different than it used to be
Employees work in teams Parts move along conveyor belts Products
move quickly through process Employees check products for quality
at several points When completed, products are packaged, labeled
and moved to a loading area for shipment Organizing the work
area
The type of product will determine how the work area is organized
Mass production requires a large building There must be space for
assembly line, equipment, tools, employee work stations and storage
areas for parts used The smaller the product, the larger amount of
workspace each employee will have Improving manufacturing
Today there are higher costs, more competition, and more customer
demands Challenges today are: faster production, increased quality
of products, reduced costs Companies are coming out with improved
procedures, better training for employees and a higher level of
quality for products Continuous Process Improvement (CPI)has been
addedincreases the quality of work by reducing errors and
waste.Processes are reviewed instead of waiting until a problem
comes up. Cpi-Continuous Process Improvement
STEP 1: Involve Everyone STEP 2: Identify process activities STEP
3: Establish quality performance standards STEP 4: Select
measurement tools STEP 5: Monitor performance continuously STEP 6:
Improve process quality Cpi (cont.) Designed to help an
organization achieve its goals by improving the quality of work
Standards are developed for quality performance Standards are based
on benchmarks (best practices among all competitors) Based on these
results, employees look for ways to improve work procedures so all
products can improve as well ANSWER #1-4 ON PAGE 328 BEFORE
CONTINUING NOTES
13-2 assessment ANSWER #1-4 ON PAGE 328 BEFORE CONTINUING NOTES
13.3 objectives Discuss the importance of effective business
operations Describe tools used to manage business operations The
importance of business operations
How a business operates day-to-day can determine if it succeeds or
fails Work procedures may not be efficient Security issues may
result in thefts Lack of maintenance could lead to expensive
repairs Bad work environment can lead to unhappy employees Types of
business operations
Some operations are specific to the type of business Most common
types of business operations: Facilities management Logistics
Scheduling Safety and security Facilities management
Buildings are one of the largest investments of a business They
provide space for all of the business operations and all storage
Management begins with deciding on the building that will be needed
(new or existing) Management also deals with maintenance and
repairs needed to make building better Management also keeps
energy/utility costs under controlbe as green as possible logistics
Managing the movement and storage of supplies, materials and
finished products in a business A newer term for logistics is:
supply chain management Major logistic duties: Locating/purchasing
where to get supplies from Transportation of supplies, materials
and products Communicating with everyone in supply chain
JUST-IN-TIME: when goods arrive just in time for production or to
sellinstead of just sitting in storage scheduling Determining the
activities that need to be completed, who will complete the work,
and the resources needed to complete the task in time Factories
must maintain the right inventory to fill each order or customers
will wait too long to receive merchandise Employee scheduling is
importantfull-time, part-time and temporary employees Company must
have the right number of people scheduled to complete the work
needed Safety and security Protecting people and property
Damage/injury can happen due to Crime Accidents Natural disasters
(tornados, earthquakes) Security employees study activities of
business to identify possible security problems then come up with a
way to prevent them They also try to minimize the amount of
accidents and injuriesgive safety training classes and hang safety
posters in employee areas Information management
Uses technology to access & exchange information to complete
the work of an organization 4 goals: Collect, organize &
maintain needed information Provide instant access to information
required to perform work and make decisions Prevent access to
unauthorized users Use technology to improve communication Types of
information used in business: text, data, graphics, pictures, and
videos Oral (telephone, voic , meetings) Written (letters, memos,
reports,s) Information management (cont.)
Information managers are responsible for designing, purchasing,
installing and maintaining the many types of technology used in
business They must develop procedures for collecting, storing and
using the information They make sure the information collected is
easy to get to, yet still safe and secure The internet makes it
more difficult to safeguard against hackers worldwide Tools for
business operations
Management Tools Operational plan: identifies how work will be
done, who will do it and what resources will be needed Operating
budget: detailed financial plan for a specific area of the business
Schedule: time plan for completing activities Procedure: list of
steps to be followed for performing a work activity Standard:
specific measurement against which an activity or result is judged.
Must be clear and realistic (EX: the number of customers that
should be served in a fast food restaurant at one time) Tools for
business operations
Technology Tools So many common business operations can be
completed using computer software like: Project management
Budgeting Scheduling Inventory Computer security Document
management New types of software are available to help with
logistics: supply chain management software and collaboration
software (pg 336) ANSWER #1-3 ON PAGE 336 BEFORE COMPLETING OTHER
CHAPTER ACTIVITIES
13-3 assessment ANSWER #1-3 ON PAGE 336 BEFORE COMPLETING OTHER
CHAPTER ACTIVITIES CHAPTER 13: extra chapter assignments
Chapter 13 Assessment #11-26 (write definition and word) Page 341:
Decision Making Strategies #32-33 Chapter 13: Study Guide
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