entrep
Materials, Manpower, Machinery, Methods, Money
5Ms representing
Input-Process-Output (IPO)
Under the systems approach the structure of production is understood as an arrangement of relationships between inputs and outputs. There are three major components in this production relationship: ___
Materials
are semi processed goods that will be subjected to further transformation in the production process. They are also called raw materials.
Locational transformation
arises when a product changes its location through various means of transportation and communication.
Method
denotes the process of combining raw materials and how these are going to be transformed using the other factor inputs of production. This resource in put is also called technology or techniques of production since it prescribes the intensity of the use of factor inputs.
Extractive transformation
happens when a natural resource is taken out from its habitat.
Information transformation
happens when knowledge and specialized skills of providers are transmitted to their customers.
Money
is a financial resource used to purchase all the resources needed by the business for its operations. Thus the owner(s) of the company contribute seed money for the initial operations of the business.
Operations Management
is concerned with the design, management, and improvement of the systems that create the organization's goods or services.
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 the production.
Physical transformation
occurs when the processing of raw materials convert them into significantly new product.
Machinery
represents all man-made physical capital used in the production process. Aside from machines, the tools, durable equipment, and the physical plan are also included.
Exchange transformation
takes place when a commodity is transmitted from the supplier to its buyer.
