Production Process: Definition, Types & Examples (2024)

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Production process definition

The production process is an essential part of any business. It is a process of turning raw materials and ideas into products and services. It is important to develop efficient and effective production processes because they heavily impact business performance.

The production process is defined as the process in which the factors of production, i.e. inputs of resources, are turned into products or services.

Factors of production means capital, labour, technology, land, and other resources that are used to create output, or goods and services.

The factors of production are explained in detail below:

• Capital includes the amount invested in the process of production. Investment can be in terms of monetary investments or assets like machines, vehicles, etc.

• Labour refers to the people involved and the time and effort that were put into the process.

• Technology refers to the technology used in the production process, whether the kind of machinery, the programming of machinery, the capacity of machinery, etc.

• Land refers to natural resources such as land, energy, etc., that are used in the process of production and are counted under the category ‘land’.

Examples of the production process

Let's explore the production process with the example of biscuit production. To set up this production process, the company requires a place or land to set up the whole production unit.

Secondly, in the production of biscuits, the organization will need the machines to mix all the necessary ingredients. It will also need an oven to bake the biscuits. In addition, it will need machinery for making the biscuits' packaging and labelling, which will all become capital investment for the company.

The company will also need labour to mix all the ingredients together, separate them into batches of production and different flavours, set the output levels of the machines and temperature of the ovens, decide on the labeling function, and oversee the overall production system.

Another important function and need of the production process is technology to ensure the labels are correct, the names of the product are rightly mentioned, the temperature is set correctly, and all other necessary technical aspects that do not require human intervention.

If all of the above factors of production are in place, the production process of biscuits runs smoothly and can match the requirement of the business and customers.

Production process flow chart

The production process goes through various stages, which can be understood with the help of the flow chart. There are multiple ways to create a production process flow chart, depending on the organization’s need and their production line. The following are generally the basic stages that are involved in most of the production processes. However, these may vary from industry to industry.

1. Planning: usually the basic requirement of all production processes. This stage helps to define the purpose and how the goals of production can be achieved properly.

2. Routing: This is the next stage in the production process where the raw materials may be procured, processed, finished, quality checked, and distributed. Decisions are made regarding the quantity and quality of goods and services as well as on the place of production. This is a crucial stage in the production process.

3. Scheduling: Scheduling means deciding the timings of the production process. For example, how much time should each stage of production involve? How long should each person work on a particular workflow?

4. Dispatching: This stage is the actual start of the production. It may involve the provision of necessary items, the maintenance of records, the monitoring of workflows as planned, the recording of the number of times a machine works, machine idling time, etc.

5. Follow-up: Follow-up is the last stage of the production process. Follow-up measures the actual versus the expected productions. Follow-up helps to detect the problems and remove them to help with the smooth functioning of the process.Figure 1. Stages of the Production Process, StudySmarter

Types of production

The methods of production can be classified into many types depending on the company’s product and the organization’s needs. The five types of production are:

• Mass production,

• Batch production,

• Job production,

• Service production, and

• Customised production.

Mass Production

Mass production means there is continuous production and all employees work continuously to produce the same items at the same time. In this kind of production, the forms and size of the products remain the same and every employee focuses on the same product. All resources are utilized to produce the same range. To make production more efficient and effective, multiple tasks may be carried out at once to get quick results.

If one company is producing only white bread on a huge level, all employees will focus on the white bread packets only. In this process, most employees will be working towards white bread making: preparing the dough, baking, etc. Others will be working on packing the produced loaves of white bread at the same time, to generate the loaves of white bread quickly and efficiently at once.

Batch Production

Batch production is similar to mass production. However, the products may be produced in batches. This means that the production may be divided based on product size, colour, form, etc.

We can understand this with the example of T-shirt production. The T-shirt manufacturing company may opt for batch manufacturing, as they would want to manufacture in different sizes from small, medium and large, and also in different colours, say red, blue, green, and yellow. Hence, the team may be divided for every batch on the basis of production of the respective size and colour.

Job Production

Job production means the products are produced in a limited quantity and may be specific to customer preferences. Job production is small-scale, and the task of producing an item or product is completed before taking up other jobs.

Service Production

This method of production involves rendering services via an automated process, such as technical support for customers.

One example in current business in terms of service production is delivery services. Consumers now have the benefit of ordering goods and services from the comfort of their own homes and receiving them directly at their doorstep due to the sheer amount and scope of delivery services available.

Customized Production

Customized production is a process in which goods and services are produced on the basis of the customer's needs. This can be divided into 2 categories:

Craft Production

This category of customised production involves a personal touch based on the specific customer's demand. One of the classic examples of this is designer clothes. Say one dress is specifically designed for a celebrity for a particular award show, on-demand, with a choice of colour and pattern, and customised to the event's theme.

Mass-customised Production

Mass-customised production is similar to craft production. However, the customised selection is produced in mass quantity. The customisation may be on the basis of shape, colour, pattern, product material, etc.

For example, Coca-Cola may have custom 500ml bottles in glass produced in larger quantities according to need. Generally, production processes may share similar factors of production with land, labor, capital, and technology. The process may change relative to demand. The stages of production remain more or less the same from planning to routing, scheduling to dispatching, and finally, follow-up. The types of production, however, may change as per demand for the product and/or the requirements of the organization, in terms of sizes, colour, customisation, etc.

Types of production examples

We have put all types of production with examples of industries in which they are usually implemented in the table below.

What are examples of the production process?

What is a production process flow chart?

What is a production process in a business plan?

Since the production process defines the way how resources are turned into final products, it is an essential part of every business plan. The efficiency of that process has a significant influence on the company's performance.

What is the production process?

The production process is defined as the process in which the factors of production, i.e. inputs of resources, are turned into beneficial outputs.

What are the types of production processes?

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