To coordinate all of these activities, manufacturing must be viewed as a system. A system is the action of two or more parts as they operate together For example, a computer system consists of input devices (keyboards, disk drive), processing unit (CPU and software) and output devices (monitor, printer). What goes into the system determines its function. If word processing software is used, the computer's function is for typing. If joy sticks and your favorite video game software are used, then the function of the computer is entertainment. The subsystems of a computer (input, process and output devices) are interrelated. What goes into the system and the way it is processed determines the output of the system. 

Systems model can be used to explain how mechanical systems, electrical systems or management systems work. In this chapter, the systems theory will be used to explain the many facets of manufacturing.

• Administrators use their knowledge and experience to make financial decisions, structure the organization and control system performance. 
• Engineers apply their special knowledge to design products and plan for production. 
• Technicians and machine operators apply their knowledge of tools and materials to produce products.
• All of the people in a manufacturing organization must work as a team to be successful. 
• The knowledge and skills of each employee must be coordinated to reach the goal of the company. 

• Natural resources are the materials used to make products. 
• Raw Materials are extracted or harvested from the environment. Iron ore, bauxite, petroleum and wood are examples of raw materials. 
• Raw materials are processed to make stock material such as steel, aluminum and plastics. 
• Natural resources are also used as an energy source. All industries use energy. 
• Heat energy is used to process materials. 
• Electrical energy is used to power machines. 
• Raw materials such as coal and petroleum are used as energy sources. 
• Since manufacturing industries are dependent on natural resources, conservation is very important. Natural resources can be preserved by minimizing waste through recycling and controlling energy usage. Companies which rely on harvested material, such as wood, often replant lumbered areas. Natural resource management not only preserves our environment it also reduces production costs.

• It takes money to run a manufacturing industry.
• Money is needed to pay employees and obtain the tools and materials needed for production. 
• Some companies are started with very little money. Others must seek financial resources to start production. 
• Investors are people or institutions, such as banks, that fund manufacturers. Banks give loans to companies. The company pays back the loan plus interest so the bank makes a profit. 
• Stock holders provide another source of funding. Stock holders purchase a part or share of the company. With the money invested by stock holders, the company can operate. In return, the stock holders get a portion of the profits or dividends.
• Before investors consider investing in a company, they must be confident that the company will succeed. Part of the job of administrators, engineers and designers is to present their plans to investors. Manufacturers must explain  exactly what they are going to produce, how they are going to produce it and the profits they expect to make.
• After the company is in operation, part of the profits can be invested back into the company. This is often done to improve the system through research and development. The accumulated goods, tools, machines, building, and inventories, are consider part of the worth or value of the company. These accumulated goods are called capital.
• The financial well being of a company is never certain. Investors are always taking a risk when investing in manufacturing. The daily ups and downs of the stock market show the changes that occur in a company's worth. Manufacturers must carefully plan and control their systems to maximize profit and minimize risk to investors.

• A  process is a series of treatments to change the inputs of the system. 
• Material processing refers to techniques used to change the shape or composition of material. It involves taking materials and transforming them into usable products by cutting, forming, conditioning, and assembling. 
• Tools such as saws, drills, knives, and files are used to cut material. Molds and forms are used to form material into different shapes. 
• Materials can be conditioned by heat or chemical treatment.  For example, the strength of steel can be changed by a process called heat treating. These processes produce materials or parts that when assembled make a finished product.

• Information processing is also an important part of the systems model. 
• Information about the flow of material, quality, labor cost, and material cost needs to be collected. This data is processed using mathematical operations. 
• The knowledge gained from processing information is used to improve the manufacturing system.

• The primary outputs of manufacturing systems are marketable products.  These products include industrial goods and finished goods. 
• Industrial goods are the stock materials and chemicals used by industries. 
• Finished goods include consumer goods (the things we use everyday) and military goods.
• The components of a manufacturing system are closely related. The quality, durability and marketability of products are determined by the input and process subsystems. 
• When planning the input and process components, managers must consider how these components will affect output. 
• Once production begins the input and process subsystem must be controlled to improve the product.

• It is important to remember that manufacturing also produces scrap and pollutants. 
• These by-products are unwanted outputs. 
• Reducing the amount of scraps and pollutants saves the company money and helps maintain good relations with the community. 
• Waste minimization programs are quickly becoming an important part of manufacturing industries.

• Control is a subsystem that involves collecting and analyzing information to modify and improve the system. Feedback insures that the desired outputs are achieved.
• The cycle begins with data collection. Data is information about the performance of a system. For example, the time to drill 100 parts may be recorded to analyze production flow. Data can be collected on the number of rejects in a production run.
• After data is collected, it must be processed so the information can be used  for decision making. Commonly, data are processed using mathematical operations. For example, lets say a manufacturer wants to know the number of products made per day. Since the same  number of products will not be produced day after day, data is collected for a full week. The average number of products produced in a day is calculated by dividing the total number of products made in a week by the number of days in the work week.

• This equation can be used to track changes in production rate. With this mathematical model, managers can also predict the number of parts that will be made in a month by multiplying the total by 30. This information can be used to determine if production is going to meet demand. 
• Mathematical operations summarize data and help managers predict performance of the system. Reports are written to communicate information to managers in other departments. Through studying reports, managers determine what to modify in the system. Modification may mean changing the design of a part so it can be produced faster. Machines may need to be added to the line to balance the flow of parts through the system. 
• After modifications are made, new data is collected and the update cycle continues. Collecting data on system performance, making changes in the system, and then looking at the data to see if the change improved the system performance is the essence of feedback and control.

• It takes systems thinking to coordinate the many operations of manufacturing. System thinking means that people understand system components and how they affect operation of the entire system.  The process involves looking at each component and make it work the best it can. Then looking to see if the change has improved system performance. 

• System thinking is a skill for planning and controlling. Models are  used to help people organize and control a system. The manufacturing system model provides a way to analyze and improve operations. The systems model helps managers and engineers plan, analyze and control their manufacturing system by:
• providing an orderly way of thinking
• showing the interrelationship of parts
• identifying sources of problems and how problems affect the performance of the entire system.