What is the mode of production? Common production methods

Design-to-order manufacturing (ETO)? What does the mode of production mean? What production methods are there in the past and present? Any questions about this issue will be answered right in the next article of Viindoo. Follow along!

What is the production method?

The mode of production, the way to exploit material wealth, is necessary for the existence and development of human society. This is how humans proceed to produce matter in different historical stages in the development process. The main mode of production is the unifying combination of productive forces and relations of production.

So, what are forces of production and relations of production?

>>>> See more: Exploring Batch Production: Definition, Strategies and How to Implement

Design-to-order manufacturing (ETO)Production methods

What is the productive force?

The productive force (LLSX) is defined as the combination of workers and means of production.

The first and most important means of production are labor tools that can create material wealth for life. More specifically, the structure of productive forces includes:

  • Labor force.
  • Production materials:
    • Labor tools.
    • Science Technology.
    • Objects of labor: Raw materials, land, resources, ...
    • Means of work: Bridges, roads, warehouses, ...

What is production relations?

Production relation is the relationship between people in the process of creating material wealth. Production relations include the following elements:

  • Relationship in ownership of means of production.
  • Finished product distribution relationship.
  • Production management relationship.

These relationships have the effect of dividing the types of assets that are produced in the society. This is often given in the form of laws and class relations in society.

The relations of production are man-made and a form of society. However, this relationship is not subject to human control, but is formed objectively in the production process. Therefore, it can be said that the relations of production are material in the form of society.

>>>> Learn More About: General production costs What is that? How to allocate and account for manufacturing overheads

The relationship between the productive forces and the relations of production and its influence on the mode of production

The forces of production determine the relations of production: Matter is always evolving. This development begins with the transformation and progress of the productive forces, represented first by the instrument of labor.

The level of the productive force is the mark of its development. The productive forces are represented by the natural conquest of man in historical periods. This level is reflected in the tools, labor skills, and human experience.

Throughout the course of human history, the level of labor has evolved from individualization to socialization. This development, when to a certain extent, makes the relations of production no longer suitable. At this time, relations of production can inhibit the development of productive forces.

This inhibition can lead to the promotion of the formation of a new production relationship. This means that new production methods are born to replace the old ones.

The relations of production affect the forces of production: When the relations of production are suitable with the LLSX level, it will become the driving force promoting this level of development. On the contrary, the QHSX will inhibit the development of the LLSX. At that time, a new production relationship will be born to match the existing production relationship, replacing the old production relationship. Since then, the production plan has continued to promote the development of the production force.

>>>> See more: 

Design-to-order manufacturing (ETO)Relationship between LLSX and QHSE

Meaning of production method

The mode of production plays an important role in the development of human civilization. This will be a decisive factor, creating a driving force for the development of society. Here are four important meanings of the mode of production to human society:

  • The mode of production is the basis for the existence and development of society. Production activities are the premise for the purpose of solving the basic needs of human life.
  • The method of production is also a basic sign to distinguish between humans and animals. This is an important impetus to separate humans from animals.
  • The mode of production is also an important factor determining the replacement and development of socio-economic forms.
  • The mode of production is considered as the core factor in the development of human society.

Historical production methods

In the development process of history, production methods do not stand still, but always change. According to Marx, there were seven main modes of production in history:

  • primitive communist society.
  • PTSX Asia.
  • PTSX owns slaves.
  • Feudal Post Office.
  • Capital Postproduction.
  • Socialist PTS.
  • Communist PTSX.

>>>> Read About: Types of production in business and characteristics

Popular production methods today

Production method for storage

Production-to-storage (MTS) is defined as a strategy based on forecasting consumer and market demand. More specifically, businesses will forecast consumer demand for products and conduct production. For example, businesses forecast in August that the demand for sugar will increase to make moon cakes. From there, businesses will proceed to produce more sugar to store and meet requirements.

However, for businesses or products where demand is unpredictable, warehousing is not recommended. The reason is that a lot of inventory while the demand cannot be determined will lead to unsold goods, non-revolving cash flow, affecting business profits.

Production and assembly according to orderProduce for storage

>>>> See More: What is the production schedule? How to easily schedule production

Made to order

Manufacturing to order (MTO) is defined as an enterprise's business strategy based on customer orders. This method is useful for customers who have special needs for a product and may require customization to desired specifications. Made-to-order suitable for highly customizable product categories.

Items that can be produced to order can be automobiles, heavy machinery, computers and accessories, etc. With this way of production, the inventory problem of enterprises is reduced. However, the waiting time of customers with this method is often quite long.

Made to Order (MTO)Made to Order (MTO)

Production and assembly according to orders

This method is a combination of both MTS and MTO, This is how the company will carry out stocking of basic parts according to market requirements and assembling finished products when customers order. The biggest advantage of this method is that it can quickly customize products based on customer needs.

For example, a machine manufacturing business will prepare basic machine parts in advance and wait for customers to place an order to proceed with the required assembly. This method also has the disadvantage that the company has limited production components and labor, so it cannot handle too many orders.

Production and assembly according to orderProduction and assembly according to order

Manufacturing to Order Configuration

Manufacturing-to-order (MTO) configuration is the practice of defining product specifications in advance. Then, when there is an order, the new business will proceed to configure the product.
With this method, businesses provide customers with many choices to best suit their needs. This will help the customer to design the product configuration. This method will be suitable for products that can be customized but not too high value such as food, furniture, ...

Design-to-order manufacturing (ETO)Custom Configurable Manufacturing

Custom Design Production

Design-to-order manufacturing (ETO) is a method in which businesses complete products according to customer requirements. Customers can ask the business to design special techniques and customize features. These requirements should be included in the terms of the sales contract with the business.

With this production method, each customer order is independent and unique. This is also the slowest production method because businesses not only have to manufacture products but also design them to suit customer requirements. This method will be suitable for special, high-value orders such as construction works, interior design, ...

Design-to-order manufacturing (ETO)Design-to-order manufacturing (ETO)

In the above post, Viindoo helped readers answer the question “What is the mode of production?”. Hopefully through the above article, businesses can get a better overview of production methods in business. If you have any questions about the production method, please leave a comment below this article to be answered!

>>>> Continue With:

What is the mode of production? Common production methods
Jun Nguyen April 30, 2023