Essential Standard 2.00 Understand the nature of business. 1

Objective 2.03 Understand production and operations. 2

Topics Types of productions and manufacturing Production and manufacturing planning Types of business operations 3

Types of productions and manufacturing 4

Types of Productions and Manufacturing continued The forms of production: Extraction Extraction and Cultivation – obtaining products from nature or using natural resources to grow.Cultivation Example: chicken, tomatoes, and broccoli Processing Processing – changing and improving the form of another product. Example: honey, mango, and soil Manufacturing Manufacturing – combining raw materials and processed goods into finished products. Example: cosmetics, china, and shoes 5

Types of Productions and Manufacturing continued Types of Manufacturing Procedures: Mass production is the process of using assembly activities to produce large quantities of identical products. Examples: Krispy Kreme donuts, Maybelline lipstick, and Nike sneakers Custom manufacturing is the process of producing a specific and exclusive product for a customer. Examples: ceramics, prosthetic limb, signs Materials processing is the process of changing raw materials to another form in order to be consumed or used to make other products. Examples: Oil refinery, lumber yard processing trees, mills processing flour, cereal, and feed. 6

Production and manufacturing planning 7

Production and Manufacturing Planning Production and manufacturing involve the following activities in order to produce products: –Product development –Production planning –Inventory management 8

Production and Manufacturing Planning continued What is involved with product development? Product development is the process of creating or improving the form of another product. Product research is performed by engineers and other scientists to develop new products or to discover improvements for existing products. Product design is first creating a model and then deciding the best possible design. 9

Production and Manufacturing Planning continued Two types of product research: –Applied Research – marketing research that studies existing products to develop design improvements or new product lines –Pure Research – discovers new solutions to problems 10

Production and Manufacturing Planning continued Production planning involves three activities: Production process consists of activities, equipment, and resources needed to manufacture products. Production resources consists of machines, tools, and other equipment needed for production. Personnel consists of employees and skills needed for production. What is inventory management? Inventory management maintains the supply of all resources needed for production and the products produced. How can a business manage inventory? Inventory can be counted by hand, estimated, or can be electronic. Example – grocery store scanning items to know what to order. 11

Production and Manufacturing Planning continued Manufacturing procedures are: –Improving the work area. How is the work area improved? Improving the work area depends on the product and production process. There must be access for parts and materials needed for production, as well as an area for finished products. –Improving manufacturing or Continuous Process Improvement. How could a company improve manufacturing? Improving manufacturing may include attention to quality, a change in the production process, or lowering costs of production. 12

Production and Manufacturing Planning continued What is the purpose of Continuous Process Improvement (CPI) efforts for a manufacturing company? is an ongoing effort to improve manufacturing processes to increase the quality of work by reducing: –Errors –Inefficiencies –Waste Continuous Process Improvement (CPI) has the following six steps: 1.Involve everyone. 2.Identify process activities. 3.Establish quality performance standards. 4.Select measurement tools. 5.Monitor performance continuously. 6.Improve process quality. 13

Types of Business Operations 14

Business Operations Common business operations: –Facilities management –Logistics –Scheduling –Safety and security 15

Business Operations continued Why would a business need to be concerned about management of their facilities? What is facilities management? is managing the buildings and land of a business and ensuring that everything is used, repaired, and running properly. How do businesses obtain their products and services in a timely manner to make available for customers? –Logistics is managing the receiving, moving, and storing of supplies, materials, and finished products 16

Business Operations continued What is involved in scheduling work, people, and resources for a business? Scheduling involves managing work to be completed, the people who will complete the work, and the resources needed for completing the work. What is involved in safety and security for a business? Safety and security involves managing personnel being in place to prevent accidents and injuries of employees and customers and protect people and property. 17