One of the most important production decisions is the choice of production method and the factor inputs. What factors will influence the choice?
Posts published in “PRODUCTION”
A production system in which all production operations are controlled by computers. Producing product relies heavily on automated production systems.
A production system in which production operations are mainly done by machinery and equipment. A larger proportion of capital input is used in the production process.
A production system in which production operations are mainly done by workers themselves. A larger proportion of labor input is used in the production process.
Excess capacity exists when the current levels of demand for a business’s products are less than the full production capacity of a business.
Capacity shortage exists when the current levels of demand for a business’s products are more than the full production capacity of a business.
Productivity is a relative measure of how efficiently the inputs are changed into output - the ratio of outputs to inputs in a production process.
Capacity in business is the maximum output that a business can produce in a given period with the available resources within an organization.
The quality and effectiveness of management are important determinants of operational efficiency of a business organization.
Efficiency means productivity. It is about the management of resources, using machinery, making people work harder, processes and people altogether.
Recently, there has been a move towards more modern production methods that use new technology to produce products - goods and services.
Intellectual capital is becoming increasingly important in knowledge-based economies. It plays a vital role in knowledge-based economy.
Scale of production means the size of the business operation. It refers to the volume or quantity of goods that a company or organization produces.
The concept of Supply Chain Management (SCM) has become an important consideration for firms – supply chains have simply become increasingly complex.
A business faces a make-or-buy decision when it has to make a choice between manufacturing a product on its own, or purchasing it from a supplier.
Production decisions mainly evolve around preparing input resources to supply output products to meet expected market demand.