OBJECTIVES:

1. Describe the 4M’s of operations in relation to

the business opportunity;

2.Develop a product description;

A.Create a prototype of the product; and
B. Test the product prototype.
How Much You Know?
Directions: Write True if the statement is correct, otherwise write False if the
statement is incorrect on the space provided.
1. Output represents the final products from the production process and distributed
to the customers.
2. The 4M’s in the production operation are the materials, manpower,
machine and money.
3. Manpower in production operation refers to the workers involved in the
production of goods.
4. Product description is the marketing copy that explains what a product is
and it’s benefits.
5. Prototype is a replica of a product.
6. Product to produce is one of the factors to be considered in the production
method.
7. Educational qualifications and experience are criteria in considering manpower.
8. Skills and expertise are not important in considering manpower.
9. Benefits are the reasons why customers will decide to buy the products.
10. Machine refers to the manufacturing equipment.
11. Supplier is an entity that supplies goods and services to another
organization.
12. Supply chain is a system of organizations, people, activities, data and
properties involved in moving a product or service from supplier to customer.
13. Business model describes the rationale of how an organization makes,
transports, and captures value in economic, social, cultural or other contexts.
14. In selecting the type of equipment to purchase, the entrepreneur may
consider cost and capacity of the equipment.
15. Value chain is the process or activities by which a company adds cost
to an article, that includes production, promotion, and providing of after-sales
service.
GUESS WHAT??
The 4Ms of Production
Manpower
Talks about human labor force involved in the
manufacture of products. It is measured as the most
serious and main factor of production. The entrepreneur
must determine, attain and match the most competent
and skilled employees with the jobs at the most
appropriate time period.

Educational qualifications and experience, status of

employment, numbers of workers required, skills and
expertise required for the job are some of the manpower
criteria that must be highly considered by the
entrepreneur.
Material

Talks about raw materials necessary in the

production of a product. Materials mainly form
part of the finished product. Just in case the
resources are below standard, the finished
product will be of unsatisfactory as well.

The entrepreneur may consider cost, quality,

availability, credibility of suppliers and waste that
the raw material may produce.
Machine
Discusses about manufacturing equipment used in
the production of goods or delivery of services.

In the process of selecting the type of equipment

to purchase, the entrepreneur may consider
types of products to be produced, production
system to be adopted, cost of the equipment,
capacity of the equipment, availability of spare
parts in the local market, efficiency of the
equipment and the skills required in running the
equipment
Method
Production method discusses the process
or way of transforming raw materials to
finished products. The resources undergo
some stages before it is finalized and
becomes set for delivery to the target
buyers.
The selection of the method of production
is dependent on product to produce,
mode of production, manufacturing
equipment to use and required skills to do
the work.
Prototyping

A duplication of a product as it will be produced, which may

contain such details as color, graphics, packaging and directions.
One of the important early steps in the inventing process is making
a prototype. Benefits are the reasons why customers will decide to
buy the products such as affordability, efficiency or ease of use. The
features of the product or service merely provide a descriptive fact
about the product or service.

It is better to test your product prototype to meet customers’

needs and expectations; and for your product to be known and
saleable. Pretesting of the product or service is similar to a sample
of the product or service given to the consumer free of cost in order
that he/she may try the product before committing to a purchase.
Supplier

An entity that offers goods and services to another business. This

entity is among of supply chain of a business, which may offer the
main part of the value contained within its products. Certain
suppliers may even involve in drop shipping, where they ship goods
directly to the customers of the buyer.

Suppliers are your business partners; without them your

business will not live. You need them as much as you need your
customers to be satisfied. But as an entrepreneur you have to
choose a potential supplier that has loyalty and value your
partnership; a supplier that would lead you to the fulfillment of your
business objectives, mission and vision.
Value chain is a method or activities by which a company adds value
to an item, with production, marketing, and the provision of after-sales
service. The main goal and benefit of a value chain, and therefore
value chain analysis, is to make or support a competitive benefit.
A supply chain is a structure of organizations, people, activities, data,
and resources involved in moving a product or service from supplier to
customer.
The main objective of supply chain management includes
management of a varied range of components and procedures, for
instance, storing of raw materials, handling the inventory, warehousing,
and movement of finished product from the point of processing to the
point of consumption.
The Business Model
Business model describes the reasons of how an organization creates,
delivers, and captures value in economic, social, cultural or other contexts.
The development of business model construction and variation is also called
business model innovation and forms a part of business plan.

It is a company's plan for how it will make revenues and make a profit. It
describes what products or services the business plans to manufacture and
market, and how it plans to do so, as well as what expenses it will incur.

There are important phases in developing your business model, namely;

Identifying the specific audience; establishing business process; recording a
business resources; developing strong value proposition; determining key
business partners; and creating a demand for today’s generation strategy
and be open for innovations.
After developing a business model, we will
proceed in developing a business plan.

Business plan is an important tool for you to have an idea about

the future of your business. Your business plan will be your guide in the
moment you will be implementing and operating your business
proposal.

You can also make use of the business plan in securing

investment capital from financial institutions or lenders. It can also be
used to influence people to work for your enterprise, to secure credit
from suppliers, and to fascinate potential customers.
Let’s read and understand
“Jessie is the eldest of five children of Mr. & Mrs. Natividad. The family is having difficulty
to support for their everyday needs. Because of this, Jessie tried to enter selling banana
cue and with his dream to make his business grow, he put up many stalls in the
community without considering the advises of his friends to make a business plan before
implementing his decision. After a few months his stalls shutdown.”
“Mercy is the youngest in the family. She found out that she loves to cut hair and apply
make up to her friends. Until such time that her friends introduced her to their friends too
for haircut and make up when there are occasions.
Few months after, Mercy was told by her friends to put up a
beauty parlor in their place. So she asks her mother who is
also a businesswoman to teach her how to make a business
plan and eventually ended with a successful business.”

“Monna is a diligent student. Because of her knowledge

gained from school about business plan she was able to
enhance her skills in business and finally found herself into his
laundry shop business.” l

* And in having a business, you also have to consider

technological forces, Social forces, Political forces,
Cultural forces, Economic forces and Legal forces.
The following are the components found in a Business Plan.

Introduction- this part discusses what is the business plan all about.

Executive Summary- is part of the business plan which is the first to be

presented but the last to be made.

Management Section- shows how you will manage your business and
the people you need to help you in your operations.

Marketing Section- shows the design of your product/service; pricing,

where you will sell and how you will introduce your product/service to
your market.

Financial Section- shows the money needed for the business, how
much you will take in and how much you will pay out.
Production Section- shows the area, equipment and materials needed
for the business.

Competitive Analysis- is the strategy where you identify major

competitors and research their products, sales and marketing
strategies.

Market- The persons who will buy the product or services

Organizational chart- is the diagram showing graphically the relation of
one official to another, or others of a company.
Problem No. 1. “In your home, when you want to
eat egg sandwich before going to school, your
mother would surely prepare it for you. Your egg
sandwich would not be produced without a
process.”

1. Who would be your manpower?

_______________________________

2. What would be your materials?

________________________________

3. What machines or tools would you use?

_________________________

4. What methods are needed to produce the egg sandwich? (Cooking

procedures- enumerate them)
 Value
Chain
Or
Supply
Chain??
 Value
Chain
Or
Supply
Chain??
 Value
Chain
Or
Supply
Chain??
Post Test
1.Which of the following refers to the human workforce involved in the
manufacture of products?
A. Materials B. Method C. Machine D. Manpower
2. The 4M’s of production are as follows except ONE.
A. Management B. Manpower C. Method D. Machine
3. Which of the following refers to the marketing copy that explains what a
product is and why it is worth purchasing?
A. Prototype B. Product description
C. Business Model D. Suppliers
4. It represents the final products from the production process and distributed to
the customers.
A. Input B. Supplies C. Output D. Materials
5. It is a replica of a product.
A. Prototype B. Product description
C. Business Model D. Suppliers
6.Which of the following refers to the system of organizations, people, activities,
information, and resources involved in moving a product or service from supplier to
customer?
A. Supply chain B. Value chain C. Business model D. Prototype
7. Which of the following is the process or activities by which a company adds value to
an article, including production, marketing, and the provision of after-sales service?
A. Supply chain B. Value chain C. Business model D. Prototype
8. It describes the rationale of how an organization creates, delivers, and captures
value in economic, social, cultural or other contexts.
B. Prototype B. Business Model C. Product description D. Suppliers
9.It is an entity that supplies goods and services to another organization.
A. Prototype B. Product description C. Business model D. Suppliers
10. Which of the following refers to the manufacturing equipment used in the
production of goods or delivery of services?
A. Machine B. Manpower C. Method D. Materials
11. It refers to the process or technique of converting raw materials to finished products.
A. Machine B. Manpower C. Method D. Materials
12. It simply refers to the raw materials needed in the production of a product.
A. Machine B. Manpower C. Method D. Materials

13. Statement I- Skills and expertise is not important in considering manpower.

Statement II- Benefits are the reasons why customers will decide to buy the products.
A. Only Statement I is true. B. Only Statement II is true.
C. Both Statements are true. D. Both Statements are false.

14. Statement I- Educational qualifications and experience is one of the criteria in

considering manpower.
Statement II- Product to produce is one of the factors to be considered in
method or production method.

A. Only Statement I is true. C. Both Statements are true.

B. Only Statement II is true. D. Both Statements are false.
15. Statement I- In selecting the type of equipment to purchase,
the entrepreneur may consider cost and capacity of the equipment.
Statement II- The purpose of a product description is to supply
customers through details around the features and benefits of the
product.

A. Only Statement I is true.

B. Both Statements are true.
C. Only Statement II is true.
D. Both Statements are false.