5.2 Production Methods

Key Terms

Batch Production involves producing a set of identical products, which works on each batch until it is fully completed before production switches to another batch. It is used where the demand for a product is frequent and steady - the product must be uniform and not custom

Capital Intensive means that the manufacturing or provision of a product relies heavily on machinery and equipment, such as automated production systems. Hence, the cost of capital accounts for the largest proportion of a capital intensive firm's overall production costs.

Cellular Manufacturing or Cell Production organizes workers into independent cells with each team comprising of multi-skilled staff with responsibility and autonomy for completing a whole unit of work in the production process.

Job Production: One off manufacturing that involves customising an individual product from start to finish, tailor made to meet the specific requirements of the client.

What are the advantages and disadvantages of job production?

1. 1. Advantages: high quality and motivation, possibility of flexibility during planning stage, uniqueness of the product, customisation of job production creates a variety of choice for the customer

   2. Disadvantages: very time consuming, labour-intensive, long working capital cycle, few economies of scale and irregularity of orders

What is batch production?

• • Batch production involves simultaneously producing a limited number of identical products know as a batch.

What are the advantages of batch production compared to job production?

1. 1. Advantages: economies of scale can be enjoyed, specialisations in the various production processes is likely to lead to increased productivity, a variety of products can be made, and variety can reduce risks of producing just a single product with limited sales potential.

   2. Disadvantages: storage is important as batch production can result in a high amount of stock, can lead to low motivation due to boredom, inflexibility and high production costs due to the reliance on machinery and equipment.

What is mass production?

• A single product is produced on a large scale very quickly usually through line production.

What is flow production and how does it differ from mass production?

1. 1. Flow production differs from mass production in terms of scale. Flow production is generally much larger and involves 24/7 manufacturing.

   2. Flow production (or process production) focuses on a continuous production process of manufacturing products that are standardized (or homogeneous) in large quantities, e.g. printing millions of identical copies of a particular daily newspaper on a production line.