Manufacturing Processes
This is the term to describe doing the things that will create the most value for the customer.
Effectiveness
Automobile production was revolutionized by this type of manufacturing process layout.
Assembly Line
Ikea's modular kitchens are an example of this strategy that allows for a moderate amount of customization and the potential for fast delivery.
ATO
One of the 3 inputs of MRP.
Includes all components of a final product, the quantity of each and the sequence in which they are assembled.
Bill of Materials (BOM)
According to Oils & Fats International, NZ exported approximately 515,000 tonnes of this key baking ingredient in 2025.
Butter
Raw materials, data and operational resources are all examples of this.
Inputs
This process layout allows for high product volume, but can really only produce highly standardized products.
Continuous Process
This strategy allows for a high level of customization, but has a slightly longer customer lead time than ATO.
MTO
An item for which demand is unrelated to other items and production planning relies solely on forecasting.
Independent Demand Item
This is the term used to describe producing an output by using the smallest input of resources.
Efficiency
Remaining largely unchanged by the number of units produced, rent, machine purchases and salaries are all examples of these.
Fixed Costs
This process layout reduces the distances materials travel (which increases production volume and shortens lead times) while still allowing for a variety of product families.
Manufacturing Cell
This is the only production strategy in which finished goods are produced in anticipation of demand, not in response to real customer demand.
MTS
One of the 3 inputs of MRP.
This is a time-phased plan specifying when and how much of each product will be produced.
Master Production Schedule
This honey-scented chonky flightless bird came in 2nd place in the 2026 Bird of the Year contest.
Kakapo
This is the production volume at which the cost of 2 options is equal.
The Breakeven Point
This is the only process layout strategy in which the product remains in a fixed position.
Project
This strategy has the lowest inventory investment, but can have a very long customer lead time due to the complexity of the products produced.
ETO
Lot-sizing is the decision around how much and when to order or produce inventory. Which lot-sizing strategy relies on ordering the same amount every time to best balance setup/ordering costs and holding costs?
Economic Order Quantity (EOQ)
Despite scaling up to distribution to supermarkets nationwide, this beloved Waikato ice cream company continues to manufacture their products in small, handmade batches.
Duck Island
The Customer Order Decoupling Point (CODP) represents the shift from a forecast-driven flow of goods to this.
A demand-driven flow of goods.
This is the name of the framework visual that maps the 5 layout strategies in terms of product standardization and product volume.
Product-Process Matrix
This strategy has the customer decoupling point closest to the customers, enabling a short customer lead time.
MTS
MRP is most useful for industries with these production/inventory strategies
MTS and ATO
This gentle filter-feeding giant can weigh almost 21 tonnes, making it the heaviest fish in the world.
Whale Shark