The paper analyses the production decision issues of the producers on the basis of the effect decomposition method.And ,according to the effect decomposition method , the paper introduces the way of combining the information of the product market and factor market with the production organization on the basis of the theoretical proof and application. The research finds that the effect decomposition method can better analyze the development of production between the two time series,and so can be as the guidance of the decision of the producer scientifically.