What I Need to Know

In developing a business plan, we also have to consider the importance of the 4M’s of
operations in all business opportunities. Because it helps you to identify the problems of the
business in the future and in actual situation especially in the production process and
marketing.
In the application of your 4M’s of production, it is best to consider the customer’s point
of view in terms of their influences as to why they will buy a particular product, does your
product aim to answer each consumer’s wants or needs and meet up with their expectations
over the product, and how do suppliers, value chain and supply chain affects the business and
production.
This module will guide you to demonstrate understanding of the 4M’s of operations and for
you to be able to:

• Describe the 4M’s (Manpower, Method, Machine, Materials) of

operations in relation to the business opportunity;
• Develop a product description;  Create a prototype of the product;
and  Test the product prototype.

What I Know
Before we start with this module, answer the following questions below.
Directions: Write True if the statement is correct, otherwise write False if the statement is
incorrect on the space provided.
______1. Output represents the final products from the production process and distributed to
the customers.
______2. The 4M’s in the production operation are the materials, manpower, machine and
money.
______3. Manpower in production operation refers to the workers involved in the production of
goods.
______4. Product description is the marketing copy that explains what a product
is and it’s benefits.
______5. Prototype is a replica of a product.
______6. Product to produce is one of the factors to be considered in the
production method.
______7. Educational qualifications and experience are criteria in
considering manpower.
______8. Skills and expertise are not important in considering manpower.

______9. Benefits are the reasons why customers will decide to buy the
products.

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 Lesso
4 M’s of Operations in Relation to
n
the Business Opportunity and
1 Developing Business Model
______10. Machine refers to the manufacturing equipment.

In your previous lesson, you learned about the 7P’s of Marketing Mix -
Product, Place, Price, Promotion, People, Packaging and Positioning in relation
to business opportunity, wherein marketing is about creating and accumulating
customers.
Marketing plans are intended to capture a market portion and to setback
competitors.
Brand name was also introduced, where it is a name, symbol, or other
feature that distinguishes a seller’s goods or services in the marketplace. Your
brand is one of the greatest assets because your brand is your customers’ over-
all experience of your business.
Experts believed that a good brand can result in better loyalty for its
customers, a better corporate image and a more relevant identity.

WHAT IS IT

The most serious issues in the whole production system are the inputs
and the transformation process. Their quality determines the quality of the output.

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The factors involved in the input and the production process are usually referred
to as the Four M’s of production, namely Manpower, Method, Machine, and
Materials..

Four M’s

 Manpower
 Method OUTPUT
 Machine
 Materials

Manpower
Talks about human labor force involved in the manufacture of products. It
is measured as the most serious and main factor of production. The entrepreneur
must determine, attain and match the most competent and skilled employees
with the jobs at the most appropriate time period.
Educational qualifications and experience, status of employment, numbers
of workers required, skills and expertise required for the job are some of the
manpower criteria that must be highly considered by the entrepreneur.
Material
Talks about raw materials necessary in the production of a product.
Materials mainly form part of the finished product. Just in case the resources are
below standard, the finished product will be of unsatisfactory as well.
The entrepreneur may consider cost, quality, availability, credibility of
suppliers and waste that the raw material may produce.
Machine
Discusses about manufacturing equipment used in the production of
goods or delivery of services.
In the process of selecting the type of equipment to purchase, the
entrepreneur may consider types of products to be produced, production system
to be adopted, cost of the equipment, capacity of the equipment, availability of
spare parts in the local market, efficiency of the equipment and the skills required
in running the equipment.

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Method
Production method discusses the process or way of transforming raw
materials to finished products. The resources undergo some stages before it is
finalized and becomes set for delivery to the target buyers.
The selection of the method of production is dependent on product to
produce, mode of production, manufacturing equipment to use and required skills
to do the work.

Product Description
It is the promotion that explains what a product is and why it’s worth
buying? The purpose of a product description is to provide customers with
details around the features and benefits of the product so they’re obliged to buy.
Know who your target market is, focus on the product benefits, tell the full
story, use natural language and tone, use power words that sell, and use good
images. These are guidelines for you to have a good product description; since
some customers are very particular with it since they consider the welfare of their
family, if it is safe to use.
Prototyping
A duplication of a product as it will be produced, which may contain such details
as color, graphics, packaging and directions. One of the important early steps in
the inventing process is making a prototype. Benefits are the reasons why
customers will decide to buy the products such as affordability, efficiency or ease
of use. The features of the product or service merely provide a descriptive fact
about the product or service. It is better to test your product prototype to meet
customers’ needs and expectations; and for your product to be known and
saleable. Pretesting of the product or service is similar to a sample of the product
or service given to the consumer free of cost in order that he/she may try the
product before committing to a purchase.
Supplier
An entity that offers goods and services to another business. This entity is
among of supply chain of a business, which may offer the main part of the value
contained within its products. Certain suppliers may even involve in drop
shipping, where they ship goods directly to the customers of the buyer.

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 Suppliers are your business partners; without them your business will not
live. You need them as much as you need your customers to be satisfied. But as
an entrepreneur you have to choose a potential supplier that has loyalty and
value your partnership; a supplier that would lead you to the fulfillment of your
business objectives, mission and vision.
Value chain is a method or activities by which a company adds value to an item, with
production, marketing, and the provision of after-sales service. The main

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 Read the stories of Jessie, Mercy and Monna below to fully understand the
importance of having a business plan:

“Jessie is the eldest of five children of Mr. & Mrs. Natividad. The family is
having difficulty to support for their everyday needs. Because of this, Jessie
tried to enter selling banana cue and with his dream to make his business
grow, he put up many stalls in the community without considering the advises
of his friends to make a business plan before implementing his decision. After
a few months his stalls shutdown.”
“Mercy is the youngest in the family. She found out that she loves to cut hair
and apply make up to her friends. Until such time that her friends introduced
her to their friends too for haircut and make up when there are occasions. Few
months after, Mercy was told by her friends to put up a beauty parlor in their
place. So she asks her mother who is also a businesswoman to teach her how
to make a business plan and eventually ended with a successful business.”
“Monna is a diligent student. Because of her knowledge gained from
school about business plan she was able to enhance her skills in business and
finally found herself into his laundry shop business.”
Each scenario taught us that business is not just about how much income or
profit you can get but it’s about the life of your business. And in having a business,
you also have to consider technological forces, Social forces, Political forces,
Cultural forces, Economic forces and Legal forces.
The following are the components found in a Business Plan.
• Introduction- this part discusses what is the business plan all about.
• Executive Summary- is part of the business plan which is the first to be
presented but the last to be made.
• Management Section- shows how you will manage your business and the
people you need to help you in your operations.
• Marketing Section- shows the design of your product/service; pricing, where
you will sell and how you will introduce your product/service to your market.
• Financial Section- shows the money needed for the business, how much you
will take in and how much you will pay out.
• Production Section- shows the area, equipment and materials needed for
the
business.
• Competitive Analysis- is the strategy where you identify major competitors
and research their products, sales and marketing strategies.
• Market- The persons who will buy the product or services
• Organizational chart- is the diagram showing graphically the relation of one
official to another, or others of a company.
 What’s More

General Directions: Answer the following questions based on your learnings about
4M’s of production and Value Chain or Supply Chain. Write your answer on the
space provided. Five (5) points in each correct answer for Problem No.1 and 2 points
for each correct answer in Problem No.2.
Problem No. 1. “In your home, when you want to eat egg sandwich before going to
school, your mother would surely prepare it for you. Your egg sandwich would not
be produced without a process.”
1. Who would be your manpower? _______________________________
2. What would be your materials? ________________________________
3. What machines or tools would you use? _________________________
4. What methods are needed to produce the egg sandwich? (Cooking
procedures- enumerate them).
______________________________________________________________

What I Have Learned

Complete the statements below and write your answers on the space provided.

1. _____________ talks about human labor force involved in the manufacture of

products. It is measured as the most serious and main factor of production.
2. _____________ is about raw materials necessary in the production of a
product.
3. _____________ discusses the process or way of transforming raw materials
to finished products.
4. The purpose of a _____________________ is to provide customers with
details around the features and benefits of the product so they’re obliged to
buy.
5. A duplication of a product as it will be produced, which may contain such
details as color, graphics, packaging and directions. One of the necessary
early steps in the inventing method is creating a _______________.
6. ____________ are your business partners, without them your business will
not live.
7. ______________________ describes the reasons of how an organization
creates, delivers, and captures value in economic, social, cultural or other
contexts.
8. ____________________ is an important tool for you to have an idea about
the future of your business.
9. ____________________ is part of the business plan which is the first to be
presented but the last to be made.
 10. ____________________ shows the design of your product/service; pricing,
where you will sell and how you will introduce your product/service to your
market.

What I can Do

Direction: Answer the following questions base on the picture shown below. Write
your answers on the space provided. Two (2) points in each correct answer.

1. Are you familiar with the picture above? Give one example of a food business
establishment that you think is famous among teenagers today.
______________________________________________________________
2. What do you think is the reason why this particular food business
establishment becomes famous among teens nowadays?
______________________________________________________________
Do you know some other ways to enjoy their product other than coming in
personally into their store and buying their product for yourself?
______________________________________________________________
Do you think such strategies are effective to make the business more
productive? Why or why not?

Assessment

Direction: Encircle the letter of your choice.

1. Which of the following refers to the human workforce involved in the
manufacture of products?
A. Materials B. Method C. Machine D. Manpower
2. The 4M’s of production are as follows except ONE.
 A. Management B. Manpower C. Method D. Machine
3. Which of the following refers to the marketing copy that explains what a
product is and why it is worth purchasing?
A. Prototype C. Business Model
B. Product description D. Suppliers
4. It represents the final products from the production process and distributed to
the customers.
A. Input B. Supplies C. Output D. Materials
5. It is a replica of a product.
A. Prototype C. Business Model
B. Product description D. Suppliers
6. Which of the following refers to the system of organizations, people, activities,
information, and resources involved in moving a product or service from
supplier to customer?
A. Supply chain B. Value chain C. Business model D. Prototype
7. Which of the following is the process or activities by which a company adds
value to an article, including production, marketing, and the provision of
aftersales service?
A. Supply chain B. Value chain C. Business model D. Prototype
8. It describes the rationale of how an organization creates, delivers, and
captures value in economic, social, cultural or other contexts.
A. Prototype C. Business Model
B. Product description D. Suppliers
9. It is an entity that supplies goods and services to another organization.
A. Prototype B. Product description C. Business model D. Suppliers
10. Which of the following refers to the manufacturing equipment used in the
production of goods or delivery of services?
A. Machine B. Manpower C. Method D. Materials
11. It refers to the process or technique of converting raw materials to finished
products.
A. Machine B. Manpower C. Method D. Materials
12. It simply refers to the raw materials needed in the production of a product.
A. Machine B. Manpower C. Method D. Materials
13. Statement I- Skills and expertise is not important in considering manpower.
Statement II- Benefits are the reasons why customers will decide to buy the
products.
A. Only Statement I is true. C. Both Statements are true.
B. Only Statement II is true. D. Both Statements are false.
14. Statement I- Educational qualifications and experience is one of the criteria in
considering manpower.
Statement II- Product to produce is one of the factors to be considered in
method or production method.
A. Only Statement I is true. C. Both Statements are true.
B. Only Statement II is true. D. Both Statements are false.
15. Statement I- In selecting the type of equipment to purchase, the entrepreneur
may consider cost and capacity of the equipment.
 Statement II- The purpose of a product description is to supply customers
through details around the features and benefits of the product.
A. Only Statement I is true. C. Both Statements are true.
B. Only Statement II is true. D. Both Statements are false.

Additional
Activities

Business Plan Making

Below is a template for business plan. You need to fill this out using the
business you want to pursue.

This section will show how you will manage your business
and the people you need to help you in your operations
MANAGEMENT a. Manager: ______________________________
SECTION
b. Workers: ______________________________

This section shows the design of your product/service;

pricing, where you will sell and how you will introduce your
product/service to your market.

a. Product Description:
MARKETING _______________________________________
SECTION b. Price:
______________________________________
c. Selling location: ____________________________

d. Promotional Activity: _________________________

This section shows the money needed for the business, how
much you will take in and how much you will pay out

a. Capital Amount: __________________________

FINANCE SECTION
b. Expected Daily Sales: _______________________
c. Expected Daily Expenses: _______________
d. Income per Day: _____________________

PRODUCTION This section shows the area, equipment and materials needs
SECTION for the business.
 a. Draw a lay out of your production area:
b. Enumerate the equipment needed:
c. Enumerate the materials needed:

RUBRIC FOR BUSINESS PLAN MAKING

The content was
wellthought, guide
Content 15
questions were thoroughly
answered
The paper was wellwritten
Organization with ideas easily 10
conveyed to readers.
Points are thoroughly
Development 5
developed
TOTAL 30

Answer Key
What I Know Assessment
1. True 11. True 1. D 11. C
2. False 12. True 2. A 12. D
3. True 13. True 3. B 13. B
4. True 14. True 4. C 14. C
5. True 15. True 5. A 15. C
6. True 6. A
7. True 7. B
8. False 8. C
9. True 9. D
10. True 10. A

References

BOOKS

Ronaldo S. Batisan, DIWA Senior High School Series: Entrepreneurship Module. Diwa
Learning Systems Inc.
Angeles A. De Guzman. Entrepreneurship (For Senior High School, Applied subject, ABM
Strand. Lorimar Publishing, Inc 2018, 25 – 26.
Edralin, Divina M. Entrepreneurship. Quezon City: Vibal Group, Inc. 2016, 80 – 83.
Leedy, P. and Ormrod, J. Practical Research: Planning and Design 7th Edition. (Merrill
Prentice Hall and SAGE Publications, 2001),
Nick L. Aduana, Entrepreneurship in Philippine Setting (for Senior High School), 2017

Dr. Eduardo A. Morato Jr., Entrepreneurship, 2016

Angeles A. De Guzman, Entrepreneurship for Senior High School Applied Subject
ABM Strand,Lorimar Publishing,p.1-5
Ronaldo S. Batisan, Entrepreneurship: Diwa Senior High School Series, Diwa Learning
Systems Inc., p. 16-20