Producing World Class Goods and Services Chapter 12

What is Production Production is the use of people and machinery to convert materials into finished products or services.

4 Basic Kinds of Utility Place (Marketing) Time (Marketing) Possession (Production) Utility Want Satisfying Power Form (Production)

Strategic Importance of Production Essential for creating profit for the company Effective management of production processes can lower the costs. Effective managers can also boost the quality of goods and services Effective managers can also respond quickly and dependably to customer’s demands.

Mass Production Specialization – Dividing work into simple components so that tasks can be accomplished more efficiently. Mechanization – Use of machines to perform tasks. Standardization – The production of uniform, interchangeable goods and parts.  Assembly Line

New Approaches to Production Flexible Production Customer Driven Production Team Concept

Production Processes Analytic System Synthetic System Continuous Process Intermittent Process – Job Order Production – Lot-Order Production

Production and Technology Robots Computer Aided Design (CAD) Computer Aided Manufacturing (CAM) – Flexible systems operation Computer Integrated Manufacturing (CIM)

Choosing the Best Location for Production Transportation Human Resources Physical Factors

Tasks of Production Managers I. Must plan the overall production process II. Must determine the best layout for the production facilities III. Must implement the production plan IV. Responsible for controlling the production process as efficiently as possible.

Facility Layout Process - Manufacturing Industry Product – Automotive Industry Fixed Position – Construction Industry Customer Oriented – Healthcare Industry

Implementing the Production Plan Decide whether to buy, sell or lease decision determines whether to manufacture a product or component, or purchase it from an outside supplier. Choosing Vendors Controlling Inventory – JIT Reengineering is the process of mapping out delivery-chain processes in detail.

Steps in Production Control 1. Production Planner develops a “shopping list” 2. Routing determines the sequence of work through out the facility 3. Scheduling develops time tables that specify the amount of time each operation takes 4. Dispatching is the issuing of instructions 5. Follow up ensures that work is proceeding according to plan.

Quality Quality Control to check for defective products Ensure processes in involved in producing goods and services are efficient as possible Quality in the design of the product usually ensures the products quality in the end.