C7&C9 - Notes - S12

7 - 1

77 Process StrategyProcess Strategy

OPMG 310 OPMG 310 Spring 2012Spring 2012

7 - 2

OutlineOutline

Four Process Strategies Process Focus

Repetitive Focus

Product Focus

Mass Customization Focus

Comparison of Process Choices

7 - 3

Outline – ContinuedOutline – Continued

Process Analysis and Design Special Consideration for Service

Process Design

Selection of Equipment and Technology

Production Technology

7 - 4© 2011 Pearson Education, Inc. publishing as Prentice Hall

Harley-DavidsonHarley-Davidson

Repetitive manufacturing worksRepetitive manufacturing works

The leading U.S. motorcycle company

Emphasizes quality and lean manufacturing

Materials as Needed system

Many variations possible

Tightly scheduled repetitive production line

7 - 5

Process Flow DiagramProcess Flow Diagram

THE ASSEMBLY LINETESTING28 tests

Oil tank work cell

Shocks and forks

Handlebars

Fender work cell

Air cleaners

Fluids and mufflers

Fuel tank work cell

Wheel work cell

Roller testing

Incoming parts

From Milwaukee on a JIT arrival schedule

Engines and transmissions

Frame tube bending

Frame-building work cells

Frame machining

Hot-paint frame painting

Crating

7 - 6

Process, Volume, and VarietyProcess, Volume, and Variety

Process Focusprojects, job shops

(machine, print, hospitals, restaurants)

Arnold Palmer Hospital

Repetitive(autos, motorcycles,

home appliances)Harley-Davidson

Product Focus(commercial

baked goods, steel, glass, beer)

Frito-Lay

High Varietyone or few units per run,(allows customization)

Changes in Modulesmodest runs, standardized modules

Changes in Attributes (such as grade, quality, size, thickness, etc.) long runs only

Mass Customization(difficult to achieve, but huge rewards)

Dell Computer

Poor Strategy (Both fixed and variable costs

are high)

Low Volume

Repetitive Process

High Volume

VolumeFigure 7.1

7 - 7

Process StrategiesProcess Strategies

Four basic strategies

1. Process focus

2. Repetitive focus

3. Product focus

4. Mass customization

Within these basic strategies there are Within these basic strategies there are many ways they may be implementedmany ways they may be implemented

7 - 8

Process FocusProcess Focus Many inputs

(surgeries, sick patients, baby deliveries, emergencies)

Many different outputs(uniquely treated patients)

Many departments and many routings

Figure 7.2(a)

(low volume, high variety, intermittent processes)

Arnold Palmer Hospital

7 - 9

Repetitive Repetitive FocusFocus

Raw materials and module inputs

Modules combined for manyOutput options

(many combinations of motorcycles)

Few modules

(multiple engine models, wheel modules)

Figure 7.2(b)

(modular)

Harley Davidson

7 - 10

Product FocusProduct Focus Few Inputs

(corn, potatoes, water, seasoning)

Output variations in size, shape, and packaging

(3-oz, 5-oz, 24-oz package labeled for each material)

Figure 7.2(c)

(low-volume, high variety, continuous process)

Frito-Lay

7 - 11

Product FocusProduct FocusNucor Steel Plant

Co

nti

nu

ou

s ca

ster

Continuous cast steel sheared into 24-ton slabs

Hot tunnel furnace - 300 ft

Hot mill for finishing, cooling, and coiling

D

E F

GHI

Scrap steel

Ladle of molten steelElectric furnace

A

BC

7 - 12

Mass Mass CustomizationCustomization

Many parts and component inputs

Many output versions(custom PCs and notebooks)

Many modules

(chips, hard drives, software, cases)

Figure 7.2(d)

(high-volume, high-variety)

Dell Computer

7 - 13

Mass CustomizationMass Customization

Imaginative and fast product design

Rapid process design

Tightly controlled inventory management

Tight schedules

Responsive supply chain partners

7 - 14

Crossover ChartsCrossover Charts

Fixed costs

Variable costs

$

High volume, low varietyProcess C

Fixed costs

Variable costs$

RepetitiveProcess B

Fixed costs

Variable costs$

Low volume, high varietyProcess A

Fixed cost Process A

Fixed cost Process B

Fixed cost Process C

Tota

l cos

t

Total cost

Total cost

V1(2,857) V2

(6,666)

400,000

300,000

200,000

Volume

$

Figure 7.4

7 - 15

Focused ProcessesFocused Processes

Focus brings efficiency

Focus on depth of product line rather than breadth

Focus can be Customers

Products

Service

Technology

7 - 16

Process Analysis and Process Analysis and DesignDesign

Is the process designed to achieve a competitive advantage?

Does the process eliminate steps that do not add value?

Does the process maximize customer value?

Will the process win orders?

7 - 17

Process Analysis and Process Analysis and DesignDesign

Flow Charts - Shows the movement of materials

Time-Function Mapping - Shows flows and time frame

Value-Stream Mapping - Shows flows and time and value added beyond the immediate organization

Process Charts - Uses symbols to show key activities

Service Blueprinting - focuses on customer/provider interaction

7 - 18

Value-Stream MappingValue-Stream Mapping

7 - 19

Service BlueprintService BlueprintPersonal Greeting Service Diagnosis Perform Service Friendly Close

Level#3

Level#1

Level#2

No

Notifycustomer

and recommendan alternative

provider.(7min)

Customer arrives for service.

(3 min)

Warm greeting and obtain

service request.(10 sec)

F

Direct customer to waiting room.

F

Notify customer the car is ready.

(3 min)

Customer departs

Customer pays bill.(4 min)

F

F

Perform required work.

(varies)Prepare invoice.

(3 min)F

FYes

FYes

F

Standard request.(3 min)

Determine specifics.

(5 min)No

Canservice be

done and does customer approve?

(5 min)

7 - 20

Special Considerations for Special Considerations for Service Process DesignService Process Design

Some interaction with customer is necessary, but this often affects performance adversely

The better these interactions are accommodated in the process design, the more efficient and effective the process

Find the right combination of cost and customer interaction

7 - 21

Service Factory Service Shop

Degree of CustomizationLow High

Deg

ree

of

Lab

or

Low

High

Mass Service Professional Service

Service Process MatrixService Process Matrix

Commercial banking

Private banking

General-purpose law firms

Law clinicsSpecialized hospitals

Hospitals

Full-service stockbroker

Limited-service stockbroker

Retailing

Boutiques

Warehouse and catalog stores

Fast-food restaurants

Fine-dining restaurants

Airlines

No-frills airlines

Figure 7.9

Digital orthodontics

Traditional orthodontics

7 - 22

Improving Service Improving Service ProcessesProcesses

Layout Product exposure, customer

education, product enhancement

Human Resources Recruiting and training

Impact of flexibility

7 - 23

Equipment and TechnologyEquipment and Technology

Often complex decisions

Possible competitive advantage Flexibility

Stable processes

May allow enlarging the scope of the processes

7 - 24

Production TechnologyProduction Technology Machine technology

Automatic identification systems (AISs)

Process control

Vision system

Robot

Automated storage and retrieval systems (ASRSs)

Automated guided vehicles (AGVs)

Flexible manufacturing systems (FMSs)

Computer-integrated manufacturing (CIM)

7 - 25

Machine TechnologyMachine Technology

Increased precision

Increased productivity

Increased flexibility

Improved environmental impact

Reduced changeover time

Decreased size

Reduced power requirements

9 - 26

99 Layout StrategiesLayout Strategies

OPMG 310 OPMG 310 Fall 2011Fall 2011

9 - 27

OutlineOutline The Strategic Importance of

Layout Decisions

Types of Layout

Office Layout

Retail Layout Servicescapes

Warehousing and Storage Layouts Cross-Docking

Customizing

9 - 28

Outline – ContinuedOutline – Continued

Fixed-Position Layout

Process-Oriented Layout Computer Software for Process-

Oriented Layouts

Work Cells

Requirements of Work Cells

Staffing and Balancing Work Cells

The Focused Work Center and the Focused Factory

9 - 29

Layout Design Layout Design ConsiderationsConsiderations

Higher utilization of space, equipment, and people

Improved flow of information, materials, or people

Improved employee morale and safer working conditions

Improved customer/client interaction

Flexibility

9 - 30

Types of LayoutTypes of Layout

1. Office layout

2. Retail layout

3. Warehouse layout

4. Fixed-position layout

5. Process-oriented layout

6. Work-cell layout

7. Product-oriented layout

9 - 31

Supermarket Retail LayoutSupermarket Retail Layout

Objective is to maximize profitability per square foot of floor space

Sales and profitability vary directly with customer exposure

9 - 32

Store LayoutStore Layout

Figure 9.2

9 - 33

Retail SlottingRetail Slotting Manufacturers pay fees to retailers

to get the retailers to display (slot) their product

Contributing factors Limited shelf space

An increasing number of new products

Better information about sales through POS data collection

Closer control of inventory

9 - 34

Warehousing and Storage Warehousing and Storage LayoutsLayouts

Objective is to optimize trade-offs between handling costs and costs associated with warehouse space

Maximize the total “cube” of the warehouse – utilize its full volume while maintaining low material handling costs

9 - 35

Warehousing and Storage Warehousing and Storage LayoutsLayouts

Warehouse density tends to vary inversely with the number of different items stored

Automated Storage and Retrieval Systems (ASRSs) can significantly improve warehouse productivity by an estimated 500%

Dock location is a key design element

9 - 36

Cross-DockingCross-Docking Materials are moved directly from

receiving to shipping and are not placed in storage in the warehouse

Requires tight scheduling and accurate shipments, bar code or RFIDidentification used foradvanced shipmentnotification as materialsare unloaded

9 - 37

CustomizingCustomizing Value-added activities performed at

the warehouse

Enable low cost and rapid response strategies Assembly of components

Loading software

Repairs

Customized labeling and packaging

9 - 38

Shipping and receiving docks

Office

Cu

sto

miz

atio

n

Conveyor

Storage racks

Staging

Warehouse LayoutWarehouse LayoutTraditional Layout

9 - 39

Warehouse LayoutWarehouse LayoutCross-Docking Layout


Off

ice


9 - 40

Fixed-Position LayoutFixed-Position Layout Product remains in one place

Workers and equipment come to site

Complicating factors Limited space at site

Different materials required at different stages of the project

Volume of materials needed is dynamic

9 - 41

Alternative StrategyAlternative Strategy As much of the project as possible

is completed off-site in a product-oriented facility

This can significantly improve efficiency but is only possible when multiple similar units need to be created

9 - 42

Process-Oriented LayoutProcess-Oriented Layout

Like machines and equipment are grouped together

Flexible and capable of handling a wide variety of products or services

Scheduling can be difficult and setup, material handling, and labor costs can be high

9 - 43

Surgery

Radiology

ER triage room

ER Beds Pharmacy

Emergency room admissions

Billing/exit

Laboratories

Process-Oriented LayoutProcess-Oriented Layout

Patient A - broken legPatient A - broken leg

Patient B -Patient B - erratic heart erratic heart pacemakerpacemaker

Figure 9.3

9 - 44

Work CellsWork Cells Reorganizes people and machines

into groups to focus on single products or product groups

Group technology identifies products that have similar characteristics for particular cells

Volume must justify cells

Cells can be reconfigured as designs or volume changes

9 - 45

Advantages of Work CellsAdvantages of Work Cells1. Reduced work-in-process inventory

2. Less floor space required

3. Reduced raw material and finished goods inventory

4. Reduced direct labor

5. Heightened sense of employee participation

6. Increased use of equipment and machinery

7. Reduced investment in machinery and equipment

9 - 46

Requirements of Work CellsRequirements of Work Cells

1. Identification of families of products

2. A high level of training, flexibility and empowerment of employees

3. Being self-contained, with its own equipment and resources

4. Test (poka-yoke) at each station in the cell

9 - 47

Improving Layouts Using Improving Layouts Using Work CellsWork Cells

Current layout - straight lines make it hard to balance tasks because work may not be divided evenly

Improved layout - in U shape, workers have better access. Four cross-trained workers were reduced.

Figure 9.10 (b)

U-shaped line may reduce employee movement and space requirements while enhancing communication, reducing the number of workers, and facilitating inspection

9 - 48

Focused Work Center and Focused Work Center and Focused FactoryFocused Factory

Focused Work Center Identify a large family of similar products

that have a large and stable demand

Moves production from a general-purpose, process-oriented facility to a large work cell

Focused Factory A focused work cell in a separate facility

May be focused by product line, layout, quality, new product introduction, flexibility, or other requirements

9 - 49

Repetitive and Product-Repetitive and Product-Oriented LayoutOriented Layout

1. Volume is adequate for high equipment utilization

2. Product demand is stable enough to justify high investment in specialized equipment

3. Product is standardized or approaching a phase of life cycle that justifies investment

4. Supplies of raw materials and components are adequate and of uniform quality

Organized around products or families of Organized around products or families of similar high-volume, low-variety productssimilar high-volume, low-variety products

9 - 50

Product-Oriented LayoutsProduct-Oriented Layouts Fabrication line

Builds components on a series of machines

Machine-paced

Require mechanical or engineering changes to balance

Assembly line

Puts fabricated parts together at a series of workstations

Paced by work tasks

Balanced by moving tasksBoth types of lines must be balanced so that the time to perform the work at each station is the same

9 - 51

McDonald’s Assembly LineMcDonald’s Assembly Line

Figure 9.12

9 - 52

Disassembly LinesDisassembly Lines

Disassembly is being considered in new product designs

“Green” issues and recycling standards are important consideration

Automotive disassembly is the 16th largest industry in the US

9 - 53

Assembly-Line BalancingAssembly-Line Balancing Objective is to minimize the imbalance

between machines or personnel while meeting required output

Starts with the precedence relationships Determine cycle time

Calculate theoretical minimum number of workstations

Balance the line by assigning specific tasks to workstations

9 - 54

Line Balancing is the process of assigning tasks to workstations in such a way that the workstations have approximately equal time

requirements.

Product Focused Layouts: Product Focused Layouts: Line BalancingLine Balancing

Since the flow is repetitive – line balancing is critical

Why is line balancing important?1. It allows us to use labor and equipment

more efficiently.2. To avoid fairness issues that arise when

one workstation must work harder than another.

9 - 55

Cycle time is the maximum time allowed at each workstation to

complete its set of tasks.

Cycle TimeCycle Time

Note: Cycle time also establishes the output rate of a line

9 - 56

Wing Component ExampleWing Component Example

This means that tasks B and E cannot be done until task A has been completed

Performance Task Must FollowTime Task Listed

Task (minutes) Below

A 10 —B 11 AC 5 BD 4 BE 12 AF 3 C, DG 7 FH 11 EI 3 G, H

Total time 66

Being wants to develop a precedence diagram for an electrostatic wing component that requires a total assembly time of 66 minutes. Boeing determines that there are 480 productive minutes of work available each day. Furthermore, the production schedule requires that 40 units of the wing component be completed from the assembly line each day. Boeing want to group the tasks into workstations.

9 - 57





Total time 66 I

GF

C

D

H

B

E

A

10

1112

5

4 3

711 3

Figure 9.13

9 - 58

I

GF

C

D

H

B

E

A

10

1112

5

4 3

711 3

Figure 9.13




Total time 66

Wing Component ExampleWing Component Example480 available

mins per day40 units required

Cycle time =

Production time available per day

Units required per day

= 480 / 40= 12 minutes per unit

Minimum number of

workstations=

∑ Time for task i

Cycle time

n

i = 1

= 66 / 12= 5.5 or 6 stations

9 - 59


I

GF

C

D

H

B

E

A

10

1112

5

4 3

711 3

Figure 9.13




Total time 66

480 available mins per day

40 units required

Cycle time = 12 mins

Minimum workstations = 5.5 or 6

Line-Balancing Heuristics

1. Longest task time Choose the available task with the longest task time

2. Most following tasks Choose the available task with the largest number of following tasks

3. Ranked positional weight

Choose the available task for which the sum of its task time and the following task times is the longest

4. Shortest task time Choose the available task with the shortest task time

5. Least number of following tasks

Choose the available task with the least number of following tasks

Table 9.4

9 - 60

I

GF

C

D

H

B

E

A

10 115

4

3

3

7

12 11

WorkstationEligible Task (positional weight)

Assign (Task time) Time

RemainingStationIdle Time

1 A (66)None

A (10) 22

2 B (33), E (26)None

B (11) 11

3 E (26), C (18), D (17) E (12) 0 0

4

5

6

H(14), C (18), D (17)H(14), D (17)H(14), F(13)G(10), H(14)

NoneG(10)I(3)

C (5)D(4)F(3) H (11)

G(7)I(3)

7301

52

0

1

2

Cycle Time: 12 minutes per workstation

Rule: “Ranked Positional weight”

Assigning Tasks to Workstations:

9 - 61

480 available mins per day

40 units required






Total time 66Station 1


Station 2

Station 3Station 4

Station 3

Station 5

Station 6Station 6

I

GF

H

C

D

B

E

A

10 11

12

5

4

3 7

11

3

Figure 9.14

9 - 62




Total time 66

Wing Component ExampleWing Component Example480 available

mins per day40 units required



Efficiency =∑ Task times

(Actual number of workstations) x (Largest cycle time)

= 66 minutes / (6 stations) x (12 minutes)

= 91.7%

Percentage of Idle Time (i.e. Balance Delay) = 100% - Efficiency = 8.3%

Idle Time per Cycle = Time allocated per unit – Time needed per unit = (cycle time)(# of stations) - ∑ Task times = (12 min)(6 stations) – 66 = 6 min

Another ExampleDr. Lori Baker, operations manager at Nesa Electronics, prides herself on

excellent assembly-line balancing. She has been told that the firm needs to complete 96 instruments per 24-hour day. The assembly-line activities are:

a) Draw a precedence diagram.b) If the daily (24-hour) production rate is 96 units, what is the highest

allowable cycle time in order to meet the required production rate?c) If the cycle time after allowances is given as 10 minutes, what is the daily

(24-hour) production rate?d) With a 10-minute cycle time, what is the theoretical minimum number of

workstations with which the line can be balanced?e) With a 10-minute cycle time and six workstations, what is the efficiency?f) What is the total idle time per cycle with a 10-minute cycle time and six

workstations?g) What is the best work station assignment you can make without exceeding

a 10-minute cycle time and what is its efficiency?

Solution

C7&C9 - Notes - S12

Documents

arnold palmer

follow task

minute cycle

focused work

fixed cost

production

cycle time

task time