1. Production methods In this topic you will learn about Job Production
Batch production
Efficiency and technology
Quality issues
Charlie and the Chocolate Factory trailer
What do you think of when you think of production?
For small firms mass production is not likely to be an option.
5.1 Production methods

2. operations management
What is operations management?
The management and coordination of resources to create a good or service
The coordination of the 4 factors of production
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5.1 Production methods

3. What combination of manual work and machinery are involved?
Methods of production
Job production
The production of one off items to meet the needs of each individual customer
Cheap and easy to set up, but more expensive to produce
Often a specialist service
Time consuming to produce
Meet specific needs of customers
Examples include:
Tailor made clothes
Specialist cakes
Web designs
What combination of manual work and machinery are involved?
How its made - trumpet
Can you explain why using job production may allow a firm to charge higher prices?
5.1 Production methods

4. Methods of production Batch Production
Identical items are produced in groups (batches), each item passing through the production process at the same time
Allows for cheaper and quicker production of individual items
More uniform products
Variation can be achieved in different batches
Examples include:
Bread
Jeans
Garden furniture
Sesame Street - How Crayons Are Made
What are the stages involved in making crayons?
Why are they made a colour at a time?
5.1 Production methods

5. Job or batch production
What are the advantages to a small firm of using job production?
What are the disadvantages to a small firm of using job production?
What are the advantages to a small firm of using batch production?
What are the disadvantages to a small firm of using batch production?
Jane is keen to use her cake making skills to try and earn a bit of extra money. She has 2 choices, she can either make batches of fruit and lemon drizzle cakes to sell at a local farm shop or make celebration cakes to order.
Which option would you choose? Justify your answer.
5.1 Production methods

6. Job or Batch
Nathan runs a small but popular smoothie bar near to Exeter University. He prides himself on the fresh nature of his products. Each smoothie is made to order with the customer choosing up to 3 fruits to design their own. At busy times, Nathan has a queue outside the door, but he knows that some customers take one look at the queue and walk off. He charges between £2 to £3 per smoothie at the moment. His girlfriend, Camilla, is studying business at the University and suggests he would be better to move to batch production and lower his prices slightly. She believes this way he could cut costs, increase sales and make a greater profit.
Question time
What is meant by the term ‘batch production’? (2 marks)
Explain 2 advantages of Nathan’s current production method? (4 marks)
Do you think that Camilla is correct to suggest Nathan switches to batch production? Justify your answer. (9 marks)
5.1 Production methods

7. What is operational efficiency?
Making the best use of inputs to achieve a given output
A firm will strive to be operationally efficient in order to increase the gap between costs and sales revenue
Lower costs
Better quality
Increase capacity
Lower wastage
Direct2U delivers an average of 50 parcels a day using one transit van and one driver. One of its rivals, Carry Safe, delivers an average of 80 parcels a day using two transit vans and two drivers.
Which is the most efficient?
What are the advantages of increased efficiency?
5.1 Production methods

8. Operational efficiency
How can a firm increase efficiency?
Staff training
Improved procedures
Specialisation
Reduced wastage
Improved motivation
Discuss how each of these actions could lead to a fall in costs?
5.1 Production methods

9. Efficiency and technology
Technology can also be key to improving efficiency and reducing costs
The use of computers and machinery within the production process
Robots
Automation of the production process
Machines not people
CAD/CAM
Enhanced design and manufacturing capabilities
Computerised stock control
Reduce stock holdings
Reduce wastage
Communication technology
Communication between operations management and other departments
Cheaper sourcing of materials
5.1 Production methods

10. How a quality problem nearly destroyed the dreams of one entrepreneur
Quality Issues
Quality will depend on customer expectations of the product:
Is it fit for the purpose that it was bought for?
Does it at least meet minimum standards expected by customers?
Does the customer believe that the product is worth the money paid?
BBC Dragons Den Trunki
Product Design, Testing and Modification-Trunki
Dragon's daughter backs Trunki
How a quality problem nearly destroyed the dreams of one entrepreneur
5.1 Production methods

11. Quality Issues Quality can be achieved through: Quality control
Checking the product at the end of the production process before it is delivered to the customer
Quality assurance
Checking the product at each stage of the production process
Quality assurance requires all employees to check their own work to ensure that the product is ‘right first time’.
What are the advantages of quality assurance over quality control?
What are the disadvantages of quality assurance over quality control?
5.1 Production methods

12. End 2 Minute Test What is meant by operations management?
Distinguish between job and batch production
State one example where job production is appropriate
State one example where batch production is appropriate
State one way technology can help improve efficiency
End