What you’ll learn to do: describe the four main categories of production processes
Even though you may not spend a lot of time thinking about the processes used to make different products, they surround you every day. Every time you come in your front door or eat a meal or even drive your car, you interact with things that were made by combinations of job-based, batch, mass, and flow production processes: they were all produced or manufactured by someone, somewhere, and a great deal of thought and planning were needed to make them available.
Businesses know what they want to produce, but the challenge is to select a process that will maximize the productivity and efficiency of production. Senior management looks to their operations managers to inform this decision. As we examine the four major types of production processes, keep in mind that the most successful organizations are those that have their process and product aligned.
- Describe project or job-based production
- Describe batch production
- Describe mass production
Project- or Job-Based Production
Project or job-based production is one-of-a-kind production in which only one type of item is manufactured at a time. This type of production is often used for very large projects or for individual customers. Because the customer’s needs and preferences play such a decisive role in the final output, it’s essential for the operations manager to maintain open and frequent communication with that customer. The workers involved in this type of production are highly skilled or specialists in their field.
The following are examples of project or job-based production:
- custom home construction
Consider the home in which you live. When the house was built, the contractor used a job process, and highly skilled workers were brought in to install the plumbing, heating, and electrical systems.
A print shop may handle a variety of projects, including newsletters, brochures, stationery, and reports. Each print job varies in quantity, type of printing process, binding, color of ink, and type of paper. A manufacturing firm that produces goods in response to customer orders is called a job shop.
Some types of service businesses also deliver customized services. Doctors, for instance, must consider the illnesses and circumstances of each individual patient before developing a customized treatment plan. Real estate agents may develop a customized service plan for each customer based on the type of house the person is selling or wants to buy.
- Unique, high quality products are made.
- Workers are often more motivated and take pride in their work.
- Products are made according to individual customer needs and improve customer satisfaction.
- Production is easy to organize.
- Very labor-intensive, so selling prices are usually higher.
- Production can take a long time and can have higher production cost, (e.g., if special materials or tools are required).
Batch production is a method used to produce similar items in groups, stage by stage. In batch production, the product goes through each stage of the process together before moving on to the next stage. The degree to which workers are involved in this type of production depends on the type of product. It is common for machinery to be used for the actual production and workers participate only at the beginning and end of the process.
Examples of batch production include the following:
American Leather, a Dallas-based furniture manufacturer, uses mass customization to produce couches and chairs to customer specifications within 30 days. The basic frames in the furniture are the same, but automated cutting machinery precuts the color and type of leather ordered by each customer. Using mass-production techniques, they are then added to each frame.
- Unit costs are lower since larger numbers are made.
- Customers are offered some variety and choice.
- Materials can be bought in bulk, so they are less expensive.
- Production is flexible since different batches are made.
- Workers specialize in one process.
- Workers are often less motivated because the work becomes repetitive.
- Set-up costs are initially high.
- Products are expensive to move around the workplace.
- Storage space will be needed to store raw materials.
Mass production—manufacturing many identical goods at once—was a product of the Industrial Revolution. Henry Ford’s Model-T automobile is a good example of early mass production. Each car turned out by Ford’s factory was identical, right down to its color. If you wanted a car in any color except black, you were out of luck.
Examples of mass production include the following:
- canned goods
- over-the-counter drugs
- household appliances
The emphasis in mass production is on keeping manufacturing costs low by producing uniform products using repetitive and standardized processes. As products became more complicated to produce, mass production also became more complex. Automobile manufacturers, for example, must now incorporate more sophisticated electronics into their car designs. As a result, the number of assembly stations in most automobile manufacturing plants has increased.
Watch the following video on the process used to manufacture the amazing Peep. It will serve as a point of reference because it features many of the process components we will be discussing in this reading.
- Labor costs are usually lower.
- Materials can be purchased in large quantities, so they are often cheaper.
- Goods are produced in large number, lowering unit costs.
- Machinery is very expensive to buy, so production lines are very expensive to set up.
- Workers are not very motivated, since their work is very repetitive.
- Production lines are not very flexible and are difficult to change.
- Production processes are at risk if any one part of the line breaks. The entire production process will have to stop, pending repair which causes expensive delays.
- Maintenance costs are very high.