Principles of Business, Marketing, and Finance Production, Distribution, and Other Business Operations Copyright © Texas Education Agency, 2011. All rights reserved

Production Activities Product Research Applied Research -studies existing products to develop design improvements or new product uses Pure Research -research done without a specific product in mind with the goal of discovering new solutions to problems Product Design -new product idea is developed into a product to sell profitably Ask students to give examples of “new” and “improved” products. Then explain how applied research helped determine the product changes. Ask students to briefly write about a new product that they expect to be a big hit. Then conduct class discussion about the ideas. Copyright © Texas Education Agency, 2011. All rights reserved

Production Planning Process Production Resources -machines, tools, other equipment Personnel -employees with necessary skills Copyright © Texas Education Agency, 2011. All rights reserved

Copyright © Texas Education Agency, 2011. All rights reserved Inventory Management Detailed account of a company’s materials, supplies, and finished products Maintains the supply of all resources needed for production and the products produced Copyright © Texas Education Agency, 2011. All rights reserved

Manufacturing Procedures Organizing the work area by type of process or assembly required Improving Manufacturing Need for faster production Need for increased quality Need for reduced costs The U.S. has steadily changed from a production to a service society. Ask students which parts of the country have been hit hard by this transition. Then ask students how manufacturing could be revived in the U.S.   Copyright © Texas Education Agency, 2011. All rights reserved

Continuous Process Improvement (CPI) Increases the quality of work by reducing errors, inefficiencies, and waste Achieves goals by improving the quality of work Benchmarks-best practices among all competitors Copyright © Texas Education Agency, 2011. All rights reserved

Importance of Business Operation Determines the Success or Failure of a Business Copyright © Texas Education Agency, 2011. All rights reserved

Copyright © Texas Education Agency, 2011. All rights reserved Types of Business Operations Facilities Management Just-in-Time Scheduling Safety & Security Logistics Information Management Facilities Mgmt.-buildings, energy and environmental management. Logistics-supply chain management. Just-in-time: goods arrive only when needed. Scheduling-determining activities to complete and necessary people and resources. Safety and security-protecting people and property from injuries and damages. Information management-collecting and managing necessary information. Copyright © Texas Education Agency, 2011. All rights reserved

Copyright © Texas Education Agency, 2011. All rights reserved Types of Businesses Producers Extractors Manufacturers Intermediaries-sell goods and services of producers to consumers and other businesses Service Business-carries out activities that are consumed by its customers Contingent Worker-no contract for long-term employment Ask students to list examples of actual businesses for the following categories: extractors, manufacturers, intermediaries, and service business. Explain how contingent workers have become increasing popular in a dynamic world. Then explain how businesses save money by hiring contingent workers who do not require fringe benefits. Copyright © Texas Education Agency, 2011. All rights reserved

Tools for Business Operations Operational Plan How work will be done Who will do the work What resources will be needed Schedule-time plan for completing activities Standard-specific measurement against which an activity or result is judged Copyright © Texas Education Agency, 2011. All rights reserved

Copyright © Texas Education Agency, 2011. All rights reserved Product Planning Product-everything a business offers to satisfy a customer’s needs Basic product Product features-additions and improvements to the basic product Options-customers are offered choices of features Brand name-unique identification Packaging-provides protection and security for the product Guarantee or warranty-builds customer confidence Fast food restaurants frequently test market new products in different geographic regions before making decisions to implement new products nationwide. Brand names carry customer expectations Copyright © Texas Education Agency, 2011. All rights reserved

Product Planning Procedures Idea Development Idea Screening Strategy Development Production and Financial Planning Limited Production and Test Marketing Full-scale Production Ask students to give examples of limited production items and test marketing Copyright © Texas Education Agency, 2011. All rights reserved

Survey Says Assignment: Select a product that is popular with your age group that you would like to start a business with. Then prepare a five-question (non-leading questions) survey to determine feelings about the strengths and weaknesses of the product and possible ways the product could be improved. Ex: What cell phone brand do you prefer and why? Ex: If you could change one thing about your current cell phone it would be? The survey should be typed and printed in class on Monday and given to at least 10 students. Survey results will be turned in on Tuesday. Ask students to give examples of limited production items and test marketing Copyright © Texas Education Agency, 2011. All rights reserved