A system can be defined as an intentional assemblage of procedures, objects, and people operating together within a given environment. According to the production system’s interdependence, participants rely on others since they cannot produce all the products they require. The interdependence is as a result of labor division and specialization. In the economic system, various parts respond to each other since they are linked.
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For instance, an increase in the price of a product influences the consumers’ demand. It is worth noting that interdependence is never rigid since countries, people, and organizations may cease producing one set of products and start producing another. Dependence occurs mainly in foreign debt, financial institutions, transnational or multinational corporations, manufactured goods, minerals, energy, and food.
Adding value to inputs
Inputs are directly linked to their capability of completing transformational activities. It is imperative for a company to ensure that there is a keen selection of inputs so as to ensure production of desirable products. Some inputs such as raw materials can be combined so as to produce unique and valuable outputs. Adequate time should be taken when selecting inputs so as to ensure that irrespective of their quality and time dedicated towards production of outputs, unique results are achieved (Wolak, Kalafatis & Harris, 1998).
Characteristics of outputs
Basically, services and products are the two forms of outputs that are necessary for any production system.
Services refer to the anticipations, advantages, or actions that are available for sale or presented so as to promote the sale of particular goods. Services are usually intangible, which implies that the value obtained from using a particular service cannot be assessed. In essence, there is no tangible product that the client can touch, taste, see, or buy. Another attribute associated with services is inseparability, which implies the concurrent utilization and delivery. Inseparability allows the consumers to shape and influence the quality and performance of the offered services (Bateman & Snell, 2011).
The third feature is heterogeneity. This indicates that during service delivery, there are high chances of variability. Basically, this is a key concern for services whose labor content is high. This is attributable to the fact that service performance is normally offered by varying individuals and their performance can differ each day. In essence, heterogeneity offers the chance of ensuring some level of service customization and flexibility.
Hence, this characteristic can act as a differentiation point or benefit. Finally, services are perishable in that it is impossible to store them and carry their value forward. The perishability of services is closely tied to their ‘time importance and dependence.’ The service producer should have a keen concern for service perishability. The consumer is only informed about the perishability issue in case there is inadequate supply and the service has to be offered later (McNamara, 2013).
The attributes associated with a particular product usually identify it with the consumer, market, or organization. Every product is as a result of a complicated combination of intangible and tangible features. These features define the product, how it is used, and valued. The characteristics of products are usually categorized into market, consumer, and technological. The market attributes include promotion, price, sales, marketplace, and the kind of market.
Consumers’ product characteristics include social, psychological, safety, nutrition, use, sensory features, and convenience. Finally, the technological features include the type of product, method of storage and processing, shape and size, structure, components used during manufacture, and raw materials.
It is worth pointing out that using differing characteristics and adding more novel features is essential as it makes the product more appealing to the clients. In fact, it promotes the production of a unique product. Usually, clients compare a product’s characteristics with the features of similar products when defining its market position. Product profile involves the combination of several characteristics.
Consumer product benefits refer to the characteristics that customers admire most. Products such as drinks possess features with varying strengths. Familiarity with product features is essential in developing products that are desirable to the company and customers. Product characteristics are basically vital in product positioning and morphology.
Why classification of outputs is confusing
Usually, intangibility is a feature that is used to define the clear distinction between products and services. Some studies assert that intangibility does not give a clear differentiation between services and products. Meredith and Shafer (2010) argue that the tangible-intangible issue is hard for people to comprehend. Some authors assert that the significance of intangibility is usually overrated. According to them, service providers usually offer the productive capacity as opposed to the tangibility or intangibility of a service.
From the foregoing discussion, the key characteristics of services are perishability, heterogeneity, inseparability, and intangibility. The attributes of products are classified into market, consumer, and technology. These characteristics are important for product morphology and positioning. Knowing the features of various products ensures production of products that are desirable to consumers.
Bateman, T. S. & Snell, S. A. (2011). Management: Leading and collaborating in the competitive world (9th ed.). New York: McGraw-Hill/Irwin.
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McNamara, C. (2013). Operations Management. Web.
Meredith, J. R. & Shafer, S. M. (2010). Operations management for MBAs (4th ed.). Hoboken, NJ: Wiley.
Wolak, R., Kalafatis, S., & Harris, P. (1998). An Investigation into Four Characteristics of Services. Journal of Empirical Generalisations in Marketing Science, 3(3), 1- 22.