UNIT 5: THE PRODUCTION AND OPERATION FUNCTION Flashcards
Describe the product function
The process of creating products from productive factors (land, labour, capital).
From inputs to outputs by total quality management (by reducing errors in manufacturing in the long-term success)
What is the concept behind the production function from an economical point of view?
Process to obtain goods and services to satisfy human needs and getting and increased value.
Types of processes depending on the time extension and the production process:
Depending on the time extension:
- continuous (állandó)
- intermittent (no continuity in the manufacturing process) szaggatott
- on request (kívánság alapú)
Depending on the production process:
- project based: involves the manufacture of an exclusive and individualized product.
- batch: characterized by manufacturing small volume of a wide variety of products
- mass or mass-produced: is carried out as an uninterrupted flow.
- continuous
What is mass production?
Many uniform and similar products are manufactured at a relatively low cost .
What is batch production?
It is characterized by manufacturing a small volume of a wide variety of products, which are quite uniform with each other and there is a close and linked relationship.
What is project based production?
This involves the manufacture of an exclusive and individualized product.
On-demand production:
No continuity in the manufacturing process is required.
Continuous production:
The conversation of inputs into finished products is carried out as an uninterrupted flow over time.
Strategic decisions: short or long term? What it contains?
LONG-TERM
What?: selection and design of products
How? Selection of technological processes
When? Determine the capacity
Where? Location
Tactical decisions: short or long term?
SHORT TERM
-scheduling and control of production
-quality control
- cost control
Objectives of the production system:
- economic efficiency: cost reduction
- increased flexibility: operations
- service to customer: information, guarantees
- product quality: internal and external satisfaction
- technical efficiency
How can I calculate technical efficiency?
The maximum output from the minimum quantity of inputs.
Inputs per unit /Outputs per unit
Economic efficiency
Refers the appropriate use of factors from a cost point of view.
INPUT VALUE monetary units/ OUTPUT VALUE monetary units
What types of costs do we have?
BASED ON ITS RELATIONSHIP TO THE QUANTITY PRODUCED:
Fixed costs, variable costs, total cost
DEPENDING ON THEIR RELATIONSHIP TO PRODUCTION:
Production costs, direct p.c., indirect p.c., general indirect c.
DEPENDING ON THE LEVEL OF UTILISATION:
Under-utilisation, overuse
What are fixed costs?
Are those that exist independently of the company’s productive activity. They exist even though there is no production.
