The production concept was found, a production orientation business dominated
the market from the beginning of Capitalism to the mid 1950’s. During the era of
the Production concept, Business concerned itself primarily with production,
manufacturing and efficiency issues.
This view point was encapsulated in Says Law which states Supply creates
its own demand (from the French economist Jean – Baptiste Say.) To put it
another way, If a product is made, somebody will want to buy it. The reason for
the predominance of this orientation is there was a shortage of manufactured
goods (relative to demand) during this period so goods sold.
Production is a process of combining various material inputs
and immaterial inputs (plans, know-how) in order to make
something for consumption (the output). It is the act of
creating output, a good or service which has value and
contributes to the utility of individuals.]
The processes and methods used to
transform tangibleinputs (raw materials, semi-finished
goods, subassemblies) and intangible inputs
(ideas, information, knowledge) into
goods or services. Resources are used in this process
to create an output that is suitable for use or
has exchange value.
The production process is concerned with
transforming a range of inputs into those
outputs that are required by the market.
This involves two main sets of resources - the
transforming resources, and the transformed
The transforming resources include the buildings,
machinery, computers, and people that carry
out the transforming processes. The
transformed resources are the raw materials
and components that are transformed into end
Production of a single product at a time
Small number of units required
Entire job is completed
ex: Birthday cake, Hairdresser, Tailoring...
Process is highly labour intensive
Workforce usually skilled craftsmen
Many small businesses start this way.
Used when demand for a product is regular rather than a
‘one-off’. An example might be a bakery producing bread.
Production is broken down into a number of operations
Each batch goes through one stage of the production
process together before moving onto next stage.
Production is organised so that different operations can
be carried out one after the other, in a continuous
large quantities are produced in standardised manner
Flow Production includes production of Cars, Micro chips
•Production is an organized activity, so every production system
has an objective.
• The system transforms various inputs to useful outputs.
• It does not operate in isolation from other organizational systems.
• There exists a feedback about the activities, which is essential to
control and improve system performance.
2. Resource Utilization
3. Product and process
4. Quality control.
5. Cost Management
Set standard and target for production
Focus on quantity and quality
Provide materials, components and equipments required
For Stocking all necessary tools, raw materials and
equipment required to service manufacturing process
Design and Technical Support
Designing and testing of new products and product prototype with
modification of existing one
Estimation of cost and testing new product process
Work study and suggestion as to how working practices can be
Manufacturing of Products
Quality control and inspection