Important issues in process design include types of processes, process planning, analysis and innovation, and technology decisions. Process planning determines how a product will be produced or a service provided. It decides which components will be made in-house and which will be purchased from a supplier, selects processes, and develops and documents the specifications for manufacture and delivery. The type of production process selected depends primarily on demand volume and degree of product standardization. Projects are produced one at a time to customer order. Batch production is used to process a variety of low- volume jobs. Mass production produces large volumes of a standard product for a mass market. Continuous production is used for very high-volume commodity products.
Several quantitative techniques are available for selecting a process. One that bases its decision on the cost trade-offs associated with demand volume is break-even analysis. The components of break-even analysis are volume (the level of production), cost (both fixed and variable), revenue (the price at which an item is sold), and profit (the difference between total revenue and total cost).