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Market Needs
Marketing
It is likely that there would be no direct effect on marketing caused by a change from batch to line processing. However, depending on what was happening outside the company, there could be an effect. If, as is arguably the case, line processing is more costly than batch processing, it might be necessary to market the product without discounts and so on. This could be problematical if there was a demand for lower costs from major clients (Cohen, 1994, p. 24+). On the other hand, it is probable that a perceptive marketing function could use the new 'flexibility' and customize-ability as a marketing tool. The concern for marketing might involve the potential delay in shipping and/or smaller lots of product available.
Finance
A change from batch to line processing is likely to have several effects on finance, arguably most of them adding costs and potentially diminishing the cash position of the company and even frightening additional investment. An example from the dairy industry from packworld.com relates the experience of a milk-processing plant that went from line to batch processing; arguably, the opposite would occur if it had changed its process from batch to line processing. In that operation, few operators or none at...
Rather, they are on the second floor and check an HMI screen to see what is underway.
When the change was made, lines were dedicated to a single bottle size so that no changes of that kind need be made. The article says:
What does change from batch to batch is the fat content of the milk being filled, the label being applied, the ink-jet coding that goes on the label, and the bottle closure (a different color for skimmed, semi-skimmed, and whole milk). Based on what the operators see on their HMI screens, they mount the proper label roll on a splicing unit and confirm it has been mounted. They also fill a cap hopper with the appropriate caps. Again, they confirm at the HMI screen that this action has taken place. Without these confirmations, the system will not proceed to the next batch order (Packaging World, 2005, p. 82).
Obviously, this has implications for finance before such a program begins whether the change is from batch to line or line to batch; in addition to revamping machinery, there might also be 'investment' in various industrial experts to get a new process properly set up. If that change was from batch to line processing, however, as suggested here, there would, over time, be reduced outflow of…
References
A batch processing approach to packaging. (2005, Sept.) Packaging World, p. 82
Albright, T.L. (1998) The effect of deviations from optimal production schedules on batch-level cost drivers, Journal of Management Issues, 10(3), p. 267+. Retrieved October 11, 2005 from www.questia.com.
Cohen, H.B. (1994) The Forgotten element of quality programs. SAM Advanced Management Journal, 599(3), p. 24+. Retrieved October 11, 2005 from www.questia.com.
Hirst, P. And Zeitlin, J. (1992) Flexible specialization vs. post Fordism, in A. Scott and M. Storper (eds.) Pathways to Industrialization, London: Routledge.
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