Chapter 10 – Section 3

Steps in Production Operations

The production process involves the coordination of many steps, such as planning, purchasing of inputs, quality control, and inventory control.

Steps in Production Operations (cont.)

• Inventory that businesses carry is a result of the production process.

• Consumer goods are goods produced for individuals and sold directly to the public to be used as they are.

production: process of changing resources into goods that satisfy the needs and wants of individuals and businesses

Once a business obtains funds to expand, it must consider the steps in setting up the production process.

• The production process involves:

• Location factors: nearness to markets, raw materials, labor supply, and transportation facilities.

• Production factors: setting start and end times for each step, and monitoring labor, machinery, and materials.

Steps in Production Operations (cont.)

– Planning—choosing a location and scheduling production.

– Purchasing—deciding what to buy, (raw materials, machinery) from whom, and at what price.

– Quality control—overseeing the grade or freshness of goods, their strength or workability, their construction or design, safety, adherence to various standards, and other factors – adds to cost of production

Steps in Production Operations (cont.)

– Inventory control—making sure that the company doesn’t run out of a specific item, and that finished goods are on hand for sale.

A. AB. BC. CD. D A B C D

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Making sure that a car seat is safe for children would fall under which stage of the process?A. Planning

B. Purchasing

C. Quality control

D. Inventory control

Technology and Production Productivity can be increased by utilizing technology and dividing labor.

Technology and Production (cont.)

• Technology is the use of science to develop new products and new methods for producing and distributing goods and services.

• In the 1700s, the Industrial Revolution came about through mechanization (combined labor of people and machines)

• One outgrowth of mechanization is the assembly line.

It is a production system in which the good being produced moves on a conveyer belt past workers who perform individual tasks in assembling it.

Henry Ford used it in his car factory

Technology and Production (cont.)

• Assembly-line production is possible due to interchangeable parts made in standard sizes and the division of labor.

division of labor: the breaking down of a job into small tasks performed by different workers

automation: production process in which machines do the work and people oversee them

robotics: sophisticated, computer-controlled machinery that operates an assembly line

• Automation and robotics are other technological advancements improving efficiency in everyday American society.