Production Processes

The product decides, not the owner

Three production processes, three definitions, and two columns of advantages and disadvantages for each. That is how this topic normally arrives, and an answer built from it describes all three and chooses none. ⚠️⚠️ WHICH IS THE PROBLEM, BECAUSE THE QUESTION ALWAYS GIVES YOU A PARTICULAR BUSINESS AND ASKS WHICH ONE SUITS IT. ⭐⭐ HERE IS THE IDEA THAT MAKES THAT ANSWERABLE. A BUSINESS DOES NOT REALLY CHOOSE ITS PRODUCTION PROCESS. THE PRODUCT CHOOSES IT. And there are only two questions to ask. How many identical units does this business need to make? And how much does each customer need theirs to be different? Answer both and the process is already decided before anybody has weighed an advantage. ⭐ ONE AT A TIME, EVERY ONE DIFFERENT, IS JOB PRODUCTION. A wedding cake, a fitted kitchen, a repair. The worker needs to be skilled because every job is a new problem, the equipment has to be general-purpose because you cannot predict the next order, and nothing gets cheaper through repetition because nothing is repeated. ⭐⭐ GROUPS OF IDENTICAL THINGS, THEN A CHANGE, IS BATCH PRODUCTION. Fifty of this, then stop, reset, and fifty of that. ⚠️ AND THE WHOLE CHARACTER OF BATCH IS THAT STOP-AND-RESET IN THE MIDDLE. Every batch question is really a question about what the changeover costs: the time it takes, the work that is not being done during it, and the waste while the new setting is found. Businesses using batch make larger batches to spread that cost, and that is why a customer wanting a small order is often told no. ⭐ ENORMOUS NUMBERS, ALL IDENTICAL, NEVER STOPPING, IS FLOW PRODUCTION. The line is built once, expensively, for one product, and then each unit costs very little because the expensive part has already been paid for. That only works if the units keep coming, which is why flow is a bet on demand rather than merely a way of making things. ⭐⭐ NOW NOTICE WHAT HAS HAPPENED. THE COSTS DID NOT HAVE TO BE MEMORISED. THEY FOLLOWED FROM HOW MUCH IS REPEATED. High cost for each unit where nothing repeats. Very low cost for each unit where everything repeats. And in between, a cost that appears every time you stop. ⚠️ IT ALSO MAKES THE WRONG ANSWER VISIBLE. A BUSINESS WHOSE CUSTOMERS ALL WANT SOMETHING SLIGHTLY DIFFERENT CANNOT USE FLOW, HOWEVER MUCH IT WOULD LIKE THE LOW UNIT COST ⭐ AND SAYING THAT IS NOT A DISADVANTAGE YOU HAVE RECALLED. IT IS THE JUSTIFICATION THE QUESTION ASKED FOR. Carry two questions through everything that follows: how many identical units, and how much variation does each customer want?

Three processes, by what repeats

The same two questions asked of each process, and the costs that follow from the answers. No figures are given, because the argument is about more and less.

Tap the two that rule out flow

Tap the TWO facts about a business that would make flow production impossible for it, whatever the cost savings.

• Every customer specifies something slightly different from the last one
• The business sells a small number of units and demand is unpredictable
• The workers are highly skilled
• The business has recently moved to a larger building

The saving that cannot be taken

A business making made-to-measure furniture reads that flow production has a much lower cost per unit, and wonders whether to switch. What is the decisive objection?

• Flow requires every unit to be identical, and this business exists because its customers want theirs different, so the saving is not available to it at any price
• Setting up a flow line would be too expensive for a small business
• The workers are too skilled to be used on a flow line
• Flow production always produces lower quality

The five terms to use precisely

Five terms, each defined by what it is. The last two are the ones that make an answer sound like an accountant rather than a list.

Match each business to what its answers force

Two that follow from repetition

Select the TWO statements that follow from the costs being a consequence of how much repeats.

• The cost of each unit is high in job production because nothing repeats, rather than because job production is inefficient
• Batch producers make larger batches to spread the cost of the changeover, which is why small orders are often refused
• Flow production is the most efficient process and businesses should move to it as soon as they can afford to
• Job production always produces higher quality than the other two

Choosing between three, on the page

Almost every question in this topic gives you a business and asks which process suits it, or whether it should change. Both are choices, and a choice is written differently from a description. ⭐⭐ ASK THE TWO QUESTIONS FIRST, ABOUT THIS BUSINESS, BEFORE YOU MENTION ANY PROCESS BY NAME. How many identical units does it need, and how much does each customer need theirs to differ? Write those two answers down. They are the evidence for everything that follows. ⭐ THEN NAME THE PROCESS THOSE ANSWERS POINT TO, AND SAY THAT IT IS BECAUSE OF THEM. The word because is doing real work here: it is what turns a name into a justification. THEN SAY WHAT IT COSTS, IN TERMS OF REPETITION. ⚠️ NOT A FIGURE, AND NOT A REMEMBERED DISADVANTAGE, BUT THE CONSEQUENCE: NOTHING REPEATS SO EACH ONE IS DEAR, OR EVERYTHING REPEATS SO EACH ONE IS CHEAP, OR THE STOPPING IN BETWEEN HAS TO BE PAID FOR. ⭐ THEN RULE ONE OTHER OUT, EXPLICITLY. Saying why the obvious alternative will not work for THIS business is often worth more than anything you have said about the one you chose, and it is the part most answers leave out. AND IF THE QUESTION IS ABOUT CHANGING, ASK WHICH OF THE TWO ANSWERS HAS CHANGED. Usually it is the first one, because the business has grown. ⚠️ THREE HABITS THAT COST MARKS HERE. ⚠️ THE FIRST IS DESCRIBING ALL THREE AND CHOOSING NONE. ⭐ AN ANSWER THAT EXPLAINS EACH PROCESS ACCURATELY AND NEVER SAYS WHICH SUITS THIS BUSINESS HAS ANSWERED A QUESTION NOBODY ASKED. ⚠️ THE SECOND IS TREATING ONE PROCESS AS SIMPLY BETTER. Flow is not an upgrade. It is unavailable to any business whose customers want variation, and it commits the business to demand that may not last. ⚠️ AND THE THIRD IS REACHING FOR NUMBERS THE QUESTION DID NOT GIVE YOU. ⭐ THIS TOPIC IS ARGUED PERFECTLY WELL IN MORE, FEWER, HIGHER AND LOWER, AND AN INVENTED FIGURE IS A LIABILITY RATHER THAN EVIDENCE. One last thing. If you find yourself writing a list of advantages, stop and go back to the two questions. The list is what you write when you have not decided; the two answers are what let you decide.

The workshop that outgrew itself

A small workshop makes wooden garden furniture. It is not a real workshop and no money amounts appear here, because the argument does not need any. At the start, every order is different. Somebody wants a bench a particular length to fit a particular wall. Somebody else wants a table with the legs set in from the ends. The two people who work there are experienced, the tools are the ordinary ones any workshop has, and each order is worked out from scratch. ⭐ THAT ARRANGEMENT SUITS WHAT IS BEING ASKED FOR, AND IT IS EXPENSIVE PER PIECE, BECAUSE NOTHING DONE FOR ONE ORDER HELPS WITH THE NEXT. Then a garden centre asks for thirty benches, all the same. ⚠️⚠️ NOTICE WHAT HAS CHANGED, BECAUSE IT IS NOT THE PRODUCT. IT IS HOW MANY OF THE SAME THING ARE WANTED AT ONCE. Now it is worth setting the saw once and cutting thirty identical pieces rather than measuring each. Worth making a template. Worth doing all the cutting, then all the assembly, rather than finishing one bench before starting the next. ⭐ NONE OF THAT WAS AVAILABLE BEFORE, BECAUSE THERE WAS NOTHING TO REPEAT. But the workshop still has its individual customers, and their orders still arrive. So the week now has a shape: a run of identical pieces, then everything stopped and reset for a one-off, then reset again. ⚠️⚠️ AND THAT STOPPING IS WHERE THE MONEY GOES NOW. THE SAW HAS TO BE RESET. THE TEMPLATE COMES OFF AND GOES BACK ON. NOTHING IS PRODUCED WHILE THAT HAPPENS, AND THE FIRST PIECE AFTER A RESET IS OFTEN WRONG. ⭐ WHICH IS WHY THE WORKSHOP STARTS ASKING THE GARDEN CENTRE FOR LARGER ORDERS LESS OFTEN, RATHER THAN SMALL ONES REGULARLY. Not because large orders are more profitable in themselves, but because each reset costs the same whether what follows it is ten pieces or fifty, so fewer resets means less of that cost. ⭐⭐ THE GENERAL POINT IS WORTH MORE THAN THE WORKSHOP: WHEN A BUSINESS CHANGES HOW IT MAKES THINGS, IT IS ALMOST ALWAYS BECAUSE THE NUMBER OF IDENTICAL THINGS WANTED HAS CHANGED, NOT BECAUSE SOMEBODY READ ABOUT A BETTER METHOD.

Order the way to justify a choice

Put these six moves into the order that turns a business described in a question into a justified answer.

• Work out how many identical units this business needs
• Work out how much each customer needs theirs to differ
• Name the process those two answers point to
• Say that it follows from those answers, using the word because
• Say what it costs, in terms of how much repeats
• Rule out one other process explicitly, for this business

Build the sentence that justifies

This is the sentence that turns a name into a justification. Assemble it.

Why a business changes process

A business that has used job production for years moves to batch. Which change usually explains that?

• It is now being asked for numbers of identical items rather than one-offs, so the first of the two questions has a different answer while the product is much the same
• Batch production has become cheaper than it used to be
• The business has lost its skilled workers
• Because batch is a more advanced process than job

The production run

Five questions on the two answers and what follows. Three lives.

Complete the production facts

Making one item at a time, each to the customer's own requirements, is _____. Making a group of identical items and then changing the setup for something else is _____. Making identical items continuously in very large numbers is _____. The cost of making one item, found by spreading the total cost across everything produced, is the _____.

Three answers that will not choose

Three students answer questions on production processes. Their facts are right; what they do with them is the problem.

• Asked which process suits a business making made-to-order signs, a student writes an accurate paragraph on each of the three and stops. How would you fix it?
• A student advises a small business whose customers all want bespoke work to move to flow production for the lower unit cost. What is wrong?
• A student argues that any growing business should move towards flow production eventually, because that is the most efficient process. Is that the strongest version?

Justify a process for one business

A small business bakes cakes. Most of its work is one-off celebration cakes made to order, but a local cafe has begun ordering the same twenty small cakes every week. Advise the business on which production process or processes it should use, and justify your advice.

• Answer the two questions for the one-off side of the business: how many identical units, and how much variation
• Name the process that side needs, and say it follows from those answers
• Answer the same two questions for the weekly cafe order, and say what has changed
• Name the process that order points to, and explain what its main cost would be
• Explain why flow production is not available to this business, in terms of what flow requires
• Say whether the business can run both, and what the cost of switching between them would be
• Reach a clear recommendation, and give no figure the question has not supplied