Production can be explained as an act of either manufacturing or mining or growing of goods (commodities) generally in bulk for trade.
Production is a method employed for making or providing essential goods and services for consumers. It is a process that puts intangible inputs like ideas, creativity, research, knowledge, wisdom, etc. in use or action. It is a way that transforms (convert) tangible inputs like raw-materials, semi-finished goods and unassembled goods into finished goods or commodities.
System is an arrangement or assembly of inter-dependent processes (activities) that are based on some logic and function. It operates as a whole and is designed (build) with an intension to achieve (fulfill) some objective or do some work. Huge systems are often a collection (assembly) of smaller sub-systems.
Production system consists of three main components viz., Inputs, Conversion Process and Output.
- Inputs include raw: Materials, machines, man-hours, components or parts, drawing, instructions and other paper works.
- Conversion process includes operations (actual production process). Operations may be either manual or mechanical or chemical. Operations convert inputs into output. Conversion process also includes supporting activities, which help the process of conversion. The supporting activities include; production planning and control, purchase of raw-materials, receipt, storage and issue of materials, inspection of parts and work-in-progress, testing of products, quality control, warehousing of finished products, etc.
- Output includes finished products, finished goods (parts), and services.
The three components of a production system are depicted in this diagram.
Hence, we can say that, production system is a union or combination of its three main components viz., Inputs, Conversion Process, and Output. In short, everything which is done to produce goods and services or to achieve the production objective is called production system.
The examples of a production system are as follows:
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.
Types of Production System:
There are mainly two main production systems:
(A) Continuous Production System
- Mass Production System
- Process Production System
(B) Intermittent Production System
- Job Production
- Batch Production
- Continuous Production System
This is the first or primary type of production system and it means it involves a continuous or almost continuous physical flow of material. It makes use of special purpose machines and produces standardized items in large quantities.
Such processes are adopted by the concern which produces goods or services continuously by putting them through a series of successive connected operations in anticipation of customer demand and rather than in response to customers or orders.
Examples are: Examples of an industry using such technology are:
- Petroleum Industry
- Chemicals Industry
- Steel and Sugar Industry
Classification of Continuous Production System:
(i) Mass Production System
This system of production is used by concerns where manufacturing is carried on continuously in anticipation of demand through the demand of the product may not be uniform through the year.
Standardization is the keynote of mass production. This system may also be called ‘Flow Production System’.
(ii) Process Production System
This system is an extended form of mass production where production is carried on continuously through a uniform predetermined sequence of operations.
Generally under this system finished product of one process is used in the next process as a raw material until the last process. Large industries like petroleum refining, heavy chemical industries generally use this system of production.
Under this system, generally, one principal raw material is transformed into several products at different stages of operations. For Example- Crude oil is processed into kerosene, gasoline, and other products.
- Intermittent Production System
Intermittent Production System situations are those where the facilities must be flexible enough to handle a wide variety of products and sizes or where the basic nature of activity imposes changes of important characteristics the input.
Under this system of manufacturing production is done in lots rather than on a continuous flow of basis. It is done more often on the basis of customer orders. The finished product is heterogeneous but within a range of standardized options assembled by the producers.
This type of production system is based on the nature of the proper management system.
Examples of such industries are:
- Auto-Mobile Industry
- Electrical Goods
- Manufacturing plants Printing press etc.
Classification of Intermittent Production System
Intermittent Production System may be divided into two types:
(i) Job Production
In this system, goods are produced according to the orders of the customers. Continuous demand for such items is not assured and therefore production is done only when the orders for the manufacturing of items are produced from the customers.
(ii) Batch Production
Under this system, the manufacturing is done in batches or groups or lots either on the basis of customer’s order or with a hope of a continuous demand of the product. Under this system, medium scale production is warranted. The best example of this type of production system is the chemical industry where different medicines are produced in batches.