- •Images of business
- •Forms of business
- •Vocabulary task
- •Business Ownership Selection
- •Sole proprietorship
- •Special Appeal to a Start-up
- •Partnership
- •Professional Services? – Yes
- •Corporation
- •Synonym of Big Business
- •Unit 2 sorting out production issues
- •Factors of production
- •Vocabulary tasks
- •The Factors of Production
- •Production and operations process
- •Defining Production and Operations Management
- •Introduction
- •Issues to Be Solved When Organising a Manufacturing Process
- •Production facilities: location, capacity and inventory
- •Issues to Be Sorted Out
- •Inventory Management
- •Just-in-time production
- •Just-In-Time Inventory Management
- •Fill in the table below with strengths and weaknesses of jit and explain all pluses and minuses of this system.
- •Business philosophies
- •Reading comprehension 1 (units 1-2)
- •1. Read the article and the questions to it.
- •2. For each question 1–5, choose one answer (а, в, с or d). Management and Production
- •Figure 1. Production variables and relationships among them
- •Figure 2. Major activities performed to manage production
Reading comprehension 1 (units 1-2)
1. Read the article and the questions to it.
2. For each question 1–5, choose one answer (а, в, с or d). Management and Production
(From M. Menson. Management. New York, USA.)
Management and Production
In order to reach goals, all managers face the challenge of planning, organising, influencing, and controlling to produce some type of product. Naturally, these products vary significantly from organisation to organisation. For example, it is the purpose of managers in automobile factories to produce cars, of managers in hospitals to produce healthy people, and of managers in universities to produce educated individuals.
Production is simply defined as the transformation of organisational resources into products. As used in this definition, organisational resources are all assets available to a manager to generate products; transformation is the set of steps necessary to change organisational resources into products; and products are various commodities aimed at meeting human needs. Figure 1 summarises what constitutes organisational resources, transformation and products as well as the relationships among them.
Figure 1. Production variables and relationships among them
Organisational Resources |
INPUTS |
Transformation |
OUTPUTS |
Product |
People Money Raw materials Machines |
Designing goods/services Assembling goods/services Storing goods/services, etс. |
Finished goods Finished services |
From this discussion it is easy to see the importance of management being continually aware of the status and use of organisational resources. These resources are of four basic types: (1) human resources, (2) monetary resources, (3) raw materials resources and (4) capital resources. Human resources are the people who work for an organisation. The skills they possess and their knowledge of the work system are invaluable to managers. Monetary resources are amounts of money managers use to purchase goods and services for the organisation. Raw materials are ingredients acquired to be used directly in the manufacturing of products. For example, rubber is a raw material that a company like would purchase with its monetary resources and use directly in the manufacturing of tires. Lastly, capital resources are the machines an organisation uses during the manufacturing process. Modern machines or equipment can be a major factor in maintaining desired production levels, while worn-out or antiquated machinery can make it impossible for an organisation to keep pace with competitors.
Operations Management
The process of managing production in organisations is commonly called operations management. Operations management can be defined as the performance of the managerial activities entailed in selecting, designing, operating, controlling, and updating productive systems. These activities can be categorised as being either periodic or continual. The distinction between periodic activities and continual activities is based upon the relative frequency of the occurrence of each; periodic activities are performed from time to time and continual activities are essentially never ending. Although this list of activities is not meant to be exhaustive, their performance in the relative frequencies implied in Figure 2 will increase the probability of efforts in operations management being successful.