Center mind map
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During production planning, managers determine how goods will be produced, where production will take place, and how manufacturing facilities will be laid out.
Make-to-order strategy (goods are made to customer specifications)
Mass production or make-to-stock strategy (high volumes of goods are made and held in inventory for later sale)
Mass customization (high volumes of customised goods are made.)
Minimisation of shipping cost
ample supply of skilled workers
favourable community for workers & families
low cost of resources
favourable business climate
Managers estimate the quantity of products to be produced by forecasting demand for their product and then calculating the capacity requirements of the production facility
Once the production process is under way, managers must continually schedule and monitor the activities that make up that process. They must solicit and respond to feedback and make adjustments where needed. At this stage, they also oversee the purchasing of raw materials and the handling of inventories.
Finally, the operations manager is directly involved in efforts to ensure that goods are produced according to specifications and that quality standards are maintained.
produce tangible products—things that can be touched or handled, such as automobiles and appliances
Producing a service
provide intangible products, such as banking, entertainment, or education.
customized to satisfy the specific needs of a customer
services are bought and consumed at the same time.
the company decides which services to offer, how to provide these services, where to locate their businesses, what their facilities will look like, and what the demand will be for their services.
make-to-order approach (in which products are made to customer satisfaction)
make-to-stock approach (in which products are made for inventory
Service providers can’t store their services for later use: services must be delivered on an as-needed basis.
scheduling workers is more complex in the service industry than in manufacturing.
services requiring a high degree of contact with customers.