Production

Production Architecture and Production Types

4.1 Layered architecture

Production management consists of layers operating at different time horizons and levels of detail. Each layer refines the decision of the layer above it, carrying forward the reality of the layer below it.

TIME HORIZON THE FUNDAMENTAL QUESTIONSTRATEGIC PLANNING — Sales and Operations Planning Volume, capacity, and inventory balance by product group. 12–24 months Can our capacity meet the demand? MASTER PRODUCTION PLAN — Critical products, seasonal quantities. Rough capacity control and strategic product prioritization 3–12 months What will we produce and when? MATERIAL REQUIREMENTS PLANNING — Product tree breakdown Planned production and purchasing proposals. 1-6 months What do we need, and when do we need it? SCHEDULING — Assigning work orders to machines and times. Finite capacity, setup optimization, queue decision. 1 day–4 weeks Which machine, in what order? PRODUCTION EXECUTION — Work order, notification, data collection Operator guidance, quality, downtime, and waste recording. Shift / hour What is happening right now? FIELD AND EQUIPMENT — Machinery, sensors, terminals, operators Counter, temperature, cycle, stop signal. Second Actual data Decisions are detailed from top to bottom; real data flows from bottom to top. When the feedback loop isn't closed, plans become detached from reality over time.

4.2 Production types

To properly structure production management, it's necessary to clarify what type of production the business is using. Most businesses have a hybrid structure where several types of production are used together, rather than a single type.

Medicine Characteristic Typical sector Management focus
Discrete Countable units, assembly logic, and a clearly defined product tree. Machinery, automotive parts industry, home appliances, electronics Work order, operation tracking, assembly sequence
Process Mixing, reaction, continuous flow; recipe and yield focused. Chemistry, food, pharmaceuticals, paint, fuel Recipe, batch traceability, yield, byproducts
Repetitive High-volume, continuous production of the same product on the production line. Packaging, standard parts, consumables Line speed, periodic notification, backwashing
Workshop (Job Shop) Small parties, varied routes, high diversity. Mold making, machining, custom manufacturing. Scheduling, setup, capacity balancing.
Project type One-off, long-term, complex product Ship, power plant, special machinery, construction contracting Project plan, progress payment, progress-based costing.

4.3 Planning Strategies

Production for stock

Produced according to demand forecasts, the customer is fulfilled from stock. Delivery is fast; the risk is in the stock. Suitable for standard and high-volume products.

Made to order

Production only begins when an order is received. There is no stock risk; delivery time is long. It is preferred for customized products.

Assembly to order

Semi-finished products are kept in stock, and the final product is assembled according to order. This intermediate model, which balances speed and variety, is used in configurable products.

Custom design

The product is designed after the order is placed. The engineering period is part of the delivery time; it is intertwined with project management.

Campaign production

The mass production of the same product group at specific intervals. This is common in process plants with high setup costs.

Mixed model

Applying different strategies to different product groups within the same facility. This is a common situation in real life; the system needs to support strategy on a product-by-product basis.



Setup decision: Production type and planning strategy are the most fundamental choices determining how the system will be configured. A wrong choice limits all subsequent improvements: configuring process production with a batch production logic permanently impairs efficiency and batch traceability.
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