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FIGURE 2.1 Unit cost versus production volume per year. Solid line, manual production; dashed line, mass production; dotted line, flexible production.

As Figure 2.1 suggests, manual production is superior to other types of production for those cases in which a highly customized product is needed in small volume and for which the nonmanual production of the product in a factory would require an expensive facility. When sufficiently large numbers of identical products are needed, mass production is generally superior. But the flexible production paradigm seems the most economical for intermediate quantities of moderately customized products that are needed in a timely manner.

The Nature Of Manufacturing

Manufacturing can be divided into two types—discrete and continuous. Continuous manufacturing refers to the production of substances or materials (e.g., the manufacture of chemical products). In continuous manufacturing, plant operations are reasonably represented by the well-understood mathematical formalism of differential equations. However, discrete manufacturing (e.g., the manufacturing of cars, airplanes, and other assembled products) is altogether different. Discrete manufacturing cannot be well represented by any known formalism.