BAM 199 Operations Management (TQM)

Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

Lesson Title: Classification of Production System (Part 1) Materials:

Lesson Objectives: SAS
At the end of this module, I should be able to:
1. Explain the concept of production and a production system. References:
2. Differentiate the different classification of production system S.Anil Kumar, N. S. (2010).
(job shop and batch production) and its advantages and Operations Management. New Age
disadvantages. International (P) Limited Publishers

Productivity Tip:
Brain dump your worries before you study. This can be done in the form of expressive writing or talking – just
so long as you’ve expressed it and gotten it out of your heads.

A. LESSON PREVIEW/REVIEW
1) Introduction
Last session, you had your first quiz about the introduction to operations management. How was
it? I know you got a good score. Congratulate yourself by tapping your shoulders and saying, “You
did a great job, self!”

Now, you will learn about what is a production system and its classifications. Have you ever
wonder how products were manufactured and how it is made similar with each one? Products are
manufactured depending on its operation volume and product variety.

2) Activity 1: What I Know Chart, Part 1

First, let us test what you already know about the topic. Try answering the questions below by
writing your ideas under the column “What I Know”. Writing keywords or phrases that you think are
related to the questions will do. You may start.

What I Know Questions: What I Learned (Activity 4)

What is a production and a

production system?

What is a job shop production?

What production system is likely

to be used in manufacturing
clothing?
B. MAIN LESSON
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 BAM 199 Operations Management (TQM)
Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

1) Activity 2: Content Notes

LO1: Explain the concept of production and a production system.

Production is defined as ‘the step-by-step conversion of one form of material into another form
through chemical or mechanical process to create or enhance the utility of the product to the
user’. Thus production is a value addition process. At each stage of processing, there will be
value addition.

A production system is defined as “the step-by-step conversion of one form of material into
another form through chemical or mechanical process to create or enhance the utility of the
product to the user.” Thus production is a value addition process. At each stage of processing,
there will be value addition.

Environment Feedback Information

Figure 1. Production System

Examples of a Production System:

● Tangible goods: Consider an example of a manufacturing industry like a Sugar Industry.
Here, sugarcane is first used as an input, then the juice of sugarcane is processed through a
conversion process, finally to get an output known as a refined sugar (used for mass
consumption).
● Intangible goods: Consider an example from a service industry that of a
software-development firm or company. Here, initially, written program codes are used as an
inputs. These codes are then integrated in some database and are provided with a
user-friendly interface through a conversion process. Finally, an output is made available in
form of an executable application program.
LO2: Differentiate the different classification of production system (job shop and batch
production) and its advantages and disadvantages.

Production systems can be classified as follows:

1. Job-shop Production;
2. Batch Production;
3. Mass Production; and
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This document is the property of PHINMA EDUCATION.
 BAM 199 Operations Management (TQM)
Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

4. Continuous Production
1. Job-shop production is characterized by manufacturing one or few quantity of products
designed and produced as per the specification of customers within prefixed time and cost.
The distinguishing feature of this is low volume and high variety of products. A job-shop
comprises of general-purpose machines arranged into different departments. Each job
demands unique technological requirements, demands processing on machines in a certain
sequence. Example is customization of flip flops by Havianas or the customization of shoes
by Nike.

Characteristics:
a. High variety of products and low volume.
b. Use of general purpose machines and facilities.
c. Highly skilled operators who can take up each job as a challenge because of
uniqueness.
d. Large inventory of materials, tools, parts.
e. Detailed planning is essential for sequencing the requirements of each product,
capacities for each work center and order priorities.

Advantages Disadvantages

● Variety of products can be produced; ● Higher cost due to frequent set-up

● Learning opportunities to workers changes;
resulting to becoming more skilled ● Higher level of inventory at all levels
and competent; and hence higher inventory cost;
● Full potential of operators can be ● Production planning is complicated.
utilized; ● Larger space requirements.
● Opportunity exists for creativity and
innovation.

2. Batch Production is one of the types of production most commonly used

in consumer durables, FMCG or other such industries where there are large variety of
products with variable demands. Batch production takes place in batches. The manufacturer
already knows the number of units he needs to a manufacturer and they are manufactured in
one batch. Examples of batch production include Biscuits, confectionaries, packaged food
items etc.

Characteristics:
a. Shorter production runs.
b. Plant and machinery are flexible.
c. Plant and machinery set up is used for the production of item in a batch and change of
set up is required for processing the next batch
d. Manufacturing lead-time and cost are lower as compared to job order production.

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 BAM 199 Operations Management (TQM)
Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

Advantages Disadvantages

● Better utilization of plant and ● Material handling is complex because

machinery of irregular and longer flows.
● Promotes functional specialization. ● Production planning and control is
● Cost per unit is lower as compared to complex.
job order production. ● Work in process inventory is higher
● Lower investment in plant and compared to continuous production.
machinery. ● Higher set up costs due to frequent
● Flexibility to accommodate and changes in set up.
process number of products.
● Job satisfaction exists for operators.

2) Activity 3: Skill-building Activities

Let’s have a drill! After completing each exercise, check your answers against the Key to
Corrections found at the end of this SAS. Try to complete each exercise before looking at the
feedback.

Exercise 1: Given the figure below, explain what is the characteristics or how each factor for the
success of the production system.

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 BAM 199 Operations Management (TQM)
Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

Exercise 2: Fill in the blanks. Identify what is asked for in the following items.
1. Job shop production is characterized by manufacturing one or few quantity of products
while _________________ is where production takes place in batches.
2. One of the advantages of a job shop production is learning activities while one of its
disadvantages is _________________ cost.
3. Material handling is complex is one of the _________________ of batch production.
4. One of the characteristics of a job shop production is high _________________ of
products and _________________ volume.
5. One of the characteristics of a batch production is it has shorter _________________.
6. Material handling is complex in batch production due to the irregular and
_________________ flows.
7. The production of a customized Louis Vuitton bag is an example of a
_________________.
8. The production of Gardenia loafs and breads is an example of a _________________.
9. The production of candies is an example of a _________________ while the
customization of the Ferrari car is an example of a job shop production.

3) Activity 4: What I Know Chart, Part 2

It’s time to answer the questions in the “What I Know Chart” in Activity 1. Log in your answers in
the “What I Learned” column. Let’s go!

4) Activity 5: Check for Understanding

Multiple Choice. Encircle the best answer.
1. The creation of goods and services using the factors of production is called:
a. Production d. Financial management
b. Assembly process
c. Research and
development
2. These are the examples of an input needed in the production, except
a. Men c. Machine
b. Materials d. Product design
3. Each job demands unique technological requirements, demands processing on
machines in a certain sequence.
a. Batch production c. Job shop production
b. Continuous production d. Mass production
4. One of the characteristics of a batch production is
a. High variety of products and low volume.
b. Use of general purpose machines and facilities.
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 BAM 199 Operations Management (TQM)
Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

c. Large inventory materials

d. Plant and machinery are flexible.
5. Some of the factors needed in the production process, except one.
a. Men
b. Salary
c. Quality
d. Maintenance

C. LESSON WRAP-UP
5) Activity 6: Thinking about Learning
Wow, congratulations! You are done with this session. Let’s track your progress. Shade the
module number you just completed.

Did you have challenges learning the concepts in this module? If none, which parts of the module
helped you learn the concepts?

______________________________________________________________________________

Some question/s I want to ask my teacher about this module is/are:

______________________________________________________________________________

FAQs

1. What is the importance of production system?

Without effective floor-level management of production processes, error and inefficiency would be
more common within a factory. There are other reasons that production management is important
to business operations:
a. Reduces manufacturing cost - By maximizing outputs while minimizing inputs, production
management lowers the cost required to produce finished products.
b. Improves competitiveness - Knowing that the right products are available on time and will be
delivered on schedule means that a company is always in the game in any market.
c. Accomplishes business objectives - Production management helps companies produce
finished goods efficiently.
d. Improves brand image - Many manufacturing companies today operate some or all their
production on a Direct to Consumer (D2C) basis.
e. Optimizes the use of resources - Production management means that labor, equipment, and
resources are optimized in the production effort. This can lower waste levels and create an
environment for employees that is positive and well balanced
2. What are production costs?

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This document is the property of PHINMA EDUCATION.
 BAM 199 Operations Management (TQM)
Module #6

Name: _______________________________________________________ Class number: _______

Section: ___________ Schedule:__________________________________ Date: _______________

Production or product costs refer to all the costs incurred by a business from manufacturing a
product or providing a service. Production costs can include a variety of expenses, such as labor,
raw materials, consumable manufacturing supplies, and general overhead.

KEY TO CORRECTIONS

Answers to Skill-Building Exercises:

Exercise 1: Suggested answers only. Answers may vary.

1. Production is an organized activity, so every production system has an objective.
2. The system transforms the various inputs to useful outputs.
3. It does not operate in isolation from the other organization system.
4. There exists a feedback about the activities, which is essential to control and improve
system performance.
Exercise 2:
1. Batch production
2. Higher
3. Disadvantages
4. Variety; low
5. Production runs
6. Longer
7. Job shop production
8. Batch production
9. Batch production

Answers to Check for Understanding:

1. A 4. D
2. D 5. B
3. C

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