Only The Heart Essay

1028 words - 4 pages

the concept of production

input - process - output

production methods including:




management of the production process

use of research and development for:

product development

systems development

quality management




inventory control techniques



Management of the Production ProcessUse of research and development for:Product developmentResearch and DevelopmentResearch refers to investigating the unknown, such as new products of processes.Development involves using research findings to create products that might be commercialised. Development can also mean improving existing processes or products, i.e. improvements in process innovation and cost reducing innovation.The Purpose of Research and Development (R&D)The purpose of (R&D) is to provide continual advancement (e.g. modifications or improvements to existing products) and to launch new products to satisfy customer needs.The Role of Research and Development (R&D)New product design and development is more often than not a crucial factor in the survival of a company. In an industry that is changing fast, firms must continually revise their design and range of products. This is necessary due to continuous technological change and development as well as other competitors and the changing preference of customers. Without an R&D program, a firm must rely on strategic alliances, acquisitions, and networks to tap into the innovations of others.What is involved in R&D? Hoang p 598R&D involves conducting extensive research into new products, their designs, testing and development of prototypes (trial or test products). Only the most promising ones are considered for commercialisation (successfully bringing a new idea to market). However, the R&D process can be extremely lengthy and drain the resources of a business. For example, pharmaceuticals spend hundreds of millions of dollars each year on R&D. Hoang p 598Nevertheless, R&D can be vital to an organization's long-term survival and success. Kodak, for instance, almost went bankrupt after falling behind the times as customers switched to digital camera technology. Furthermore, R&D can improve the efficiency and performance of an organisation, thereby adding value in the production process. For example, Apple and Microsoft have thrived on R&D as a source of higher sales growth and increased market value.R&D often pays off for businesses that operate in sunrise industries (those that have rapid growth potential, such as high-tech industries). In addition, R&D can generate a first-mover advantage. This refers to the benefits of being the first business to launch a new and innovative product, such as Apple iPod (October 2001) or Pfizer's Viagra impotence drug (March 1998). Such benefits include the ability to charge a high price, to develop a favourable corporate image and to establish strong market share....

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