4Ms of Operations: By: Raffy Ricardos Alveza Entrepreneurship

4Ms OF OPERATIONS
By: RAFFY RICARDOS ALVEZA

ENTREPRENEURSHIP
Production is the
creation of good and
services.
1. MATERIAL – Are semi processed goods that will
be subjected to further transformation in the
production process. They are also called raw
materials or intermediate inputs.
- For example, in the process of producing pan de sal,
we need several materials that serve as intermediate
inputs including flour, sugar, butter, eggs, salt, and other
ingredients.
2. MANPOWER – is the human resource input used in the
production process. Manpower does not only include labor or
muscular power but also intellectual, creative abilities, and
other qualities of individuals that can contribute to
production.
- In the production of pan de sal, manpower resources
include the baker and his assistants who will implement
the recipe using available equipment and technology.
- The manager, sales clerks, and janitors are also part of the
manpower resources of the bakery.
3. MACHINERY – All man-made physical capital
used in the production process. Aside from
machineries, the tools, durable equipment, and
the physical plant are also.
- In our example on the production of pan de sal,
the machinery comprises the oven, baking
utensils, and the bakery itself.
3. MACHINERY – an apparatus using or
applying mechanical power and having
several parts, each with definite function
and together performing particular task.
4. METHODS – denotes the process of combining
raw materials and how these are going to be
transformed using the other inputs of
production. This resource input is also called
technology or techniques of production since it
prescribes the intensity in the use of factor
inputs
If labor is abundant and cheap in the locality, the
firm may utilize more labor-intensive techniques.
This implies that it will use more labor relative to
other factor inputs. If, no other hand, labor is
expensive and capital is cheap, the firm may
implement capital-intensive technology. This
means that the firm will use more capital relative
to other factor inputs.
In the production of pan de sal, the mixing of
ingredients will use manual labor intensively as
applied by many small bakeries. On the other
hand, large bakeries in urban areas will use
modern baking equipment and utensils that are
capital-intensive.
The following questions can be helpful in deciding the
technical requirement of the business:
1.Are enough raw materials of the correct quality available

when needed for year-round production?
2.Is the cost of the raw materials satisfactory?
3.Are the correct size and type of equipment available for the
expected production level and is it at a reasonable cost?
4.Can it be made by local workshops? Are maintenance and
repair cost affordable?
5.Are sufficient information and expertise available to ensure
that the food is consistently made at the required quality?
The following questions can be helpful in deciding the
technical requirement of the business:
6. Are suitable packaging materials available and affordable?

7. Are distribution procedures to retailers or other sellers
established?
8. Is a suitable building available? What modifications are
needed?
9. Are services available and affordable?
10. Are trained workers available and are their salaries
affordable?
1.PRODUCTION PLANNING. This plan should indicate how
different stages in a process are linked together. It should
identify any bottlenecks in the process, the equipment that
is required for each stage and where quality assurance
should be used. The data that has been found from market
surveys is added to the process chart to indicate the scale of
production that is required. A chart is prepared and used for
planning a number of different aspects of the production
process.
2. RAW MATERIALS AND INGREDIENTS. There are two
stages involved in planning the amounts of materials that
are needed to produce the required weight of product. It
is necessary to calculate the amount of each
ingredient that will be needed to formulate a batch of
product. Further, it is necessary to calculate the
amount of losses that can be expected during
preparation.
3. EQUIPMENT REQUIRED. The decisions on
equipment requirements are influenced by the:
(a)The cost and availability of the machinery;
(b)The availability of the people who are skilled in
maintenance; and
(c)the availability and cost of spare parts and the
possibilities of local equipment fabrication.
4. PACKAGING. Consider the following:
(a) the technical requirements of the product for
protection against light, crushing, air moisture
etc.;
(b) the promotional and marketing requirements;
and
(c) the relative cost and availability of different types
of packaging.
5. STAFFING LEVELS. Decisions on the number and
types of workers that are required to operate the
proposed business are taken in conjunction with
decisions on equipment requirement. It is possible to
break down the production into different stages and then
decide the number of people that will be needed for each
stage of the process. It is important also to include
functions such as store management, quality assurance
and bookkeeping when planning employment levels.

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4Ms OF OPERATIONS

By: RAFFY RICARDOS ALVEZA

1.Are enough raw materials of the correct quality available

6. Are suitable packaging materials available and affordable?

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