Production & Business Operations Chapter 13 1
13.1 Learning Targets I can describe the role of producers in the economy I can differentiate among the various types of manufacturing 2
Production as an Economic Activity Role of Producers (LT) Can be described by the categories of products produced and the types of businesses that make products. 3 categories of products used by businesses & consumers Natural Resources Agricultural products Processed goods 3
Types of Businesses responsible for production producers extractors farmers manufacturers 4
Forms Extraction of Production and cultivation Products are obtained from nature or grown using natural resources. Processing involves changing & improving the form of another product. Manufacturing Combines raw materials & processed goods into finished products. 5
Manufacturing A manufacturing process Types of manufacturing procedures (LT) mass production custom manufacturing materials processing continuous processing intermittent processing 6
13.2 Learning Targets I can identify the activities involved in production planning I can describe how manufacturing is organized 7
Product Development 1. Product Research Many scientists & engineers devote all of their work time to research and development (R&D) Goals: develop new products that will meet the needs of customers & improve the current products offered by the company and its competitors. 8
Applied Research Studies existing products to develop design improvements or new product uses. Pure research Research done without a specific product in mind with the goal of discovering new solutions to problems. 9
2. Product Design Businesses must turn a new product idea into a product they can make & sell profitably. Design engineers select materials that make the product useable & durable. 10
Production Planning (LT) 1. Production Process 2. Production Resources 3. Personnel 11
Inventory Management Inventory detailed account of a company s materials, supplies, & finished products. Inventory management maintains the supply of all resources needed for production & the products produced. 12
Manufacturing Procedures (LT) Organizing the work area Type of product & production process will determine how the work area is organized. Improving manufacturing Continuous process improvement (CPI) Increases the quality of work by reducing errors, inefficiencies & waste. Benchmarks Best practices used by competitors 13
13.3 Learning Targets 1. I can describe the importance of effective business operations. 2. I can describe tools used to manage business operations. 14
Importance of Business Operations (LT) Businesspeople need to plan business operations as carefully as they work to satisfy their customers of plan for new products. Ex. competitive prices, efficient work procedures, security issues, lack of maintenance, and poor work environment 15
Types of Business Operations 1. Facilities Management a. protects the company s investment of thousands or even millions of dollars. b. Begins with making economic decisions about the buildings needed. c. Facilities managers continually study the long-term plans of the company. d. Building maintenance e. Energy & environmental management 16
Tools (Cont.) 2. Logistics a. supply chain (newer term for managing logistics) All of the businesses involved from the time raw materials are obtained until finished products are sold b. just-in-time goods arrive when needed (just in time) for production, use, or sale rather than sitting in storage. 17
Tools Cont. 3. Scheduling Determining the activities that need to be completed, the people who will perform the work, and the resources needed for the task. Company depends on having the right # of people available at any time to complete the scheduled work. 18
Tools (concluded) 4. Safety & security Companies are responsible for protecting people & property. Damage & injury can occur because of crime, unintentional actions, or natural causes. Businesses work to maintain safe work areas and work procedures. They provide safety training & enforce rules and regulations designed to reduce accidents 19
Information Management Uses technology to access & exchange information to complete the work of an organization. 20
4 Goals of Information Management 1. Collect, organize, & securely maintain all needed information 2. Provide instantaneous access to information required to perform work and make decisions. 3. Prevent access to information by those unauthorized to use it. 4. Use technology to improve communication and information sharing. 21
Tools for Business Operations (LT) Management Tools Operational plan Identifies how the work will be done, who will do it, & what resources will be needed. Schedule Time plan for completing activities. Standard specific measurement against which an activity or result is judged. 22
Operating budget detailed financial plan for a specific area of the business. Procedure List of steps to be followed for performing a particular work activity. 23
Using Technology to Manage Operations Common types of operations software (Fig. 13.2 on page 333). Supply-chain management Allows cooperating companies to share ordering, production, & shipping information, track products, & exchange consumer data. 24
Collaboration software (groupware) Provides real-time communications capabilities Cloud computing Needed software, resources, and work files are maintained on a common server and accessed by employees when needed. 25