Unit 10: Method, Machine, Materials, and Manpower
(4Ms of Operations)
Lesson 1
The 4Ms of Operations
Entrepreneurship
Senior High School Applied - Academic
Aside from making a
unique distinction of a
product through
branding, what else
should an entrepreneur
need to focus on?
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Learning
Describe the 4Ms (method,
Objective
machine, materials, and
At the end of the manpower) of operations of a
lesson, you should be business.
able to do the
following:
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1. What are the qualifications that you will
consider in hiring an employee for your
business?
2. How will you ensure the success of the
production of your product?
3. How will you ensure the continuous
availability of the raw materials needed for
production?
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Method
Method refers to the
process that is strictly
followed in the
manufacturing of a
business product.
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Three Elements of Manufacturing
1. Input - This refers to the materials or ingredients that are being used
in creating the product.
2. Process - This refers to the transformation phase where the raw
materials or ingredients are being processed by manpower and
machines to come up with the final product.
3. Output - This refers to the final product that is intended to be sold to
the target customers.
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What are the recommended sites
in product manufacturing?
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Manufacturing Site Options
Home-based
This site option is highly flexible and the
cheapest among the three. This is the best
choice for most start-up businesses that do not
have the capacity to establish a manufacturing
site yet.
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Manufacturing Sites Options
Commercial space for rent
This is the recommended option if the
business already needs a commercial space for
the processing of the product and if the home-
based option is not viable or feasible.
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Manufacturing Sites Options
Commercial space purchase
This is the ideal option for established
businesses, but this requires the biggest
amount of capital.
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Remember
The manufacturing site and
production schedule are
determined based on the
projected demand.
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Major Manufacturing Layouts
1. Product-focused - These facilities are prearranged
according to the flow of the manufacturing operations.
It is recommended for a job-shop type of operations.
2. Process-based - These facilities are grouped according
to their function. This is used for those with batch or
continuous production operations setup.
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Major Manufacturing Layouts
Product-focused Process-based
Product High volume but a Low volume but a wide variety of
production low variety of products
products
Production High fixed cost Costing estimate is done before
cost the production process.
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Major Manufacturing Layouts
Product-focused Process-based
Equipment Uses special purpose Uses general-purpose equipment
and labor equipment and has and has skilled personnel
generally low-skilled
labor
Scheduling Relatively simple Complex scheduling
of scheduling
production
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Remember
In determining a site, take into
consideration the applicable
standards as well as necessary
permits required by the
authorities.
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Example: Process-based Manufacturing Layout
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Example: Process-based Manufacturing Layout
The plant is divided into several job shops. Each
job shop is composed of uniquely skilled
workers that process the product.
Different processing requirements are done in
each job shop to come up with a final product.
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Machine
Machine refers to the tools, facilities, and
systems that are used to produce a product.
The machinery and equipment required can be
identified after the manufacturing layout of the
business has already been determined.
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Information and Communications Technology
● landline phones
● mobile phones
● computers
● point of sale (POS) machines
● accounting and inventory software
● website
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Remember
Machines are not limited to
physical equipment only but can
also pertain to new technologies.
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Entrepreneurs’ Responsibilities in Safeguarding Machines
1. Protecting against fraudsters
2. Training of employees in keeping information
confidential
3. Constant updating and checking of software
programs
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Entrepreneurs’ Responsibilities in Safeguarding Machines
4. Assuring that there is a business continuity
program (BCP)
5. Appointing experts in charge of the business’s
software and computers
6. Having insurance coverage for equipment
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How are materials important in
operating a business?
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Materials
Materials refer to the raw items that are used
in creating a product or performing a service.
The materials’ specifications, quantity needed,
and the schedule of delivery should be clearly
planned.
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Materials Requisition Options
1. Manufacturing of own materials
2. Outsourcing
3. Purchasing own products from
present suppliers
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Pricing Methods
1. Cost-oriented pricing
2. Competition-oriented pricing
3. Demand-oriented pricing
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Manpower
Manpower refers to the human resources who
will handle the business operations.
Qualification Standards:
1. Manpower
2. Experience
3. Academics
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Activity
If you are a business owner, how will you
utilize the 4Ms of operations?
Draw an illustration of the 4Ms of operations in
relation to the business you have in mind.
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Questions
Part A. Explain the meaning of the following concepts in
relation to business operations.
1. Method
2. Machine
3. Materials
4. Manpower
5. Manufacturing site options
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Questions
Part B.
Search five products or services for each
category of pricing methods. Provide a short
explanation of why such a product falls under
the identified category.
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Wrap Up
Method refers to the process which is strictly
followed in the manufacturing of a business
product.
Machine refers to the tools, facilities, and
systems that are used to produce a product.
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Wrap Up
Materials refer to the raw items that are used in
creating a product or performing a service.
Manpower refers to the human resources who
will handle the business operations.
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Wrap Up
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Bibliography
“4 Types of Pricing Methods – Explained!” Economics Discussion. Accessed April 3, 2020.
http://www.economicsdiscussion.net/price/4-types-of-pricing-methods-explained/3841.
“Boundless Business.” Lumen. Accessed April 3, 2020.
https://courses.lumenlearning.com/boundless-business/chapter/pricing-methods/.
“Four Process Strategies.” Bilingual Online. Accessed April 3, 2020.
http://bilingualonline.net/contents/Turabo/MANA705/week_4/4_1.html.
Peters, Michael & Robert Hisrich. Entrepreneurship 4th Edition. McGraw-Hill Book Co.,
1999.
Your Guide in Starting a Small Business. Department of Trade and Industry, 2015.
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