Production Methods Lecture Notes

Overview

• Main Objective: Understand different methods of production
• Focus: Job production, batch production, mass/flow production, and mass customization
• Assessment Objective: Discuss operations/production methods
• Scope: Manufacturing of tangible goods (not services)

Key Concepts

Product Perception Map (PPM)

• Definition: Categorizes products based on quality and price
• Recap: Review class 4.2 for detailed understanding

Types of Production

Job Production

• Definition: Production of unique, one-off items
• Examples: Batmobile, wedding cakes, spaceships
• PPM Category: Typically premium products
• Advantages:
  • High flexibility and customization
  • Higher prices and markups
  • Motivating for employees due to involvement in the entire process
• Drawbacks:
  • High cost and long production times
  • Labor-intensive and dependent on skilled employees

Batch Production

• Definition: Production of groups/batches of identical products
• Examples: Bakery products, pharmaceuticals, brewery
• PPM Category: Likely not premium; can be economy, bargain, or cowboy
• Advantages:
  • Customization possible for whole batches
  • More efficient than job production due to economies of scale
• Drawbacks:
  • Requires higher stock levels
  • Capital-intensive with higher maintenance costs

Mass/Flow Production

• Interchangeable Terms: Used in IB business management
• Definition: Large-scale production of identical products on a continuous line
• Examples: Coca-Cola, mass-market cars, FMCGs
• PPM Category: Typically bargain or economy
• Advantages:
  • Most efficient with low average costs due to automation
  • Benefits from economies of scale
  • Low requirement for skilled labor
• Drawbacks:
  • Least customizable
  • High setup costs and requires large-scale demand
  • Demotivating for employees due to repetitive tasks

Mass Customization

• Definition: Mass production with customization flexibility
• Examples: Volkswagen, Mini
• Advantages:
  • Combines efficiency of mass production with customization
  • Allows for consumer choice
• Drawbacks:
  • High dependence on design and technology
  • Expensive and time-consuming setup

Summary

• Labor vs. Capital Intensive: Job production is labor-intensive, mass/flow is capital-intensive, batch is intermediate
• Efficiency, Costs, and Setup: Various spectrums are used to compare methods

Additional Notes

• Historical Context: Henry Ford and the assembly line revolutionized mass production
• Further Learning: Explore more about production method pioneers and leverage online resources for deeper understanding

Conclusion

• Action Items: Review previous classes for concepts like economies of scale, PPM, and job rotation
• Reminder: Achieve the class assessment objective by exploring provided resources and engaging with the content