CHRISTINE A. CAYANAN Production and Operation Management 06/12/2022 1 Christine A. Cayanan
Jun 14, 2015
CHRISTINE A. CAYANAN
Production and Operation Management 04/13/2023
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CHAPTER 7
Process Strategy
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What is Process Selection?
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Process Selection : It refers to deciding on the way production of goods or
services will be organized.
It has a major implications for capacity planning, layout of facilities and design of work systems.
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Commercial Video Clip on Process Strategy
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There are 2 Aspects of Process Strategy
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2 Aspects of Process Strategy Capital Intensity- is the mix of equipment and labor that
will be used by the organization.
Process Flexibility- the degree to which the system can be adjusted to changes in processing requirements due to such factors as changes in product or service design, changes in volume processed and changes in technology.
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TECHNOLOGY
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TECHNOLOGY Technological Innovation- refers to the discovery and
development of new or improved products, services, or processes for producing or providing them.
Technology- refers to application of scientific discoveries to the development and improvement of goods and services, or processes that produce or provide them.
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There are 3 kinds of Technology
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3 Kinds of Technology
1. Product and Service Technology- it is the discovery and development of new products and services.
- This is done mainly by researchers and engineers, who use the scientific approach to develop new knowledge and translate that into commercial applications.
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Product and Service Technology Video
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3 Kinds of Technology
2. Process Technology- includes methods, procedures, and equipment used to produce goods and provide services.
- Involves not only the processes within an organization, it also extends to supply chain processes.
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3 Kinds of Technology
3. Information Technology (IT)- is the science and use of computers and other electronic equipment to store, process, and send information.
- This includes electronic data processing , the use of bar codes and radio frequency tags to identify, track goods, devices used to obtain point of sale information, e-commerce, e-mail and more.
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Information Technology Video
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Technology as a Competitive Advantage
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Examples of technological advances are:
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1.Cell phones2.Wireless computing3.Emails4.Digital cameras5.Satellite radio
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PROCESS SELECTION
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PROCESS SELECTION There are 3 primary questions bear on process selection:1. How much variety of products will the system need to
handle?2. What degree of equipment flexibility will be needed?3. What is the expected volume of output?
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3 BASIC STRATEGIES
Process focus Product focus Repetitive focus
Continuum
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PROCESS FOCUS
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Process – Focused Strategy -an organization's approach to transforming
resources into goods and services
-objective is to create a process that can produce products that meets customer requirements within cost and other managerial constraints
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Process-Focused Strategy Examples
Bank
© 1995 Corel Corp.
Machine Shop© 1995 Corel Corp.
Hospital© 1995 Corel Corp.
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TYPES OF PROCESS FOCUS
1. JOB SHOP2. BATCH3. REPETITIVE/ASSEMBLY4. CONTINUOUS
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1. JOB SHOP A JOB SHOP usually operates on a relatively small
scale. It is used when a low volume of high-variety goods or services will be needed.
Processing is intermittent ; work includes small jobs, each with somewhat different processing requirements.
Finished goods are usually made to order.
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Examples: Restaurants, Hospitals, machine shops
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2. BATCH It is used when a moderate volume of goods
or services is desired, and it can handle a moderate variety in products or services.
Example: Bakeries, which make bread, cakes or
cookie in batches.
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Batch Process Video
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3. REPETITIVE When higher volumes of more
standardized goods or services are needed, repetitive processing is used.
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Examples: (Repetitive)
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Repetitive Process Video
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4. CONTINUOUS When a very high volume of non-discrete
, highly standardized output is desired, a continuous system is used. Example: Oil Refinery performs a continues process.
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Continuous Process Video
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PRODUCT AND SERVICE PROFILING This can be used to avoid any
inconsistencies by identifying the key product or service dimensions and in selecting appropriate processes.
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AUTOMATION Machinery that has sensing and control
devices that enable it to operate automatically.
Example: EZ tag, ATM
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3 kinds of Automation Fixed Automation Programmable Automation Computer-aided manufacturing (CAM)
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1. Fixed Automation Is the most rigid of the 3 types. It uses a
high cost, specialized equipment for fixed sequence of operations.
Advantage: low cost and high volume Limitation: minimal variety and high
cost of making major changes in either product or process.
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2. Programmable automation
It involves the use of high-cost, general purpose equipment controlled by a computer program that provides both the sequence of operations and specific details about each operation.
Example: robots are applications of programmable automation
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Computer –aided manufacturing (CAM)-refers to the use of computers in process control, ranging from robots to automated quality control,
• Numerically controlled (N/C) machines –are programmed to follow a set of processing instructions based on the mathematical relationships that tells the machine the details of operations to be performed.
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3. Flexible Automation Evolved from programmable
automation . It uses equipment that is more customized than that of programmable automation.
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Automation Video
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FACILITIES LAYOUT
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LAYOUT
This refers to the configuration of department , work centers and equipment with particular emphasis on movement of work through the system.
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Most common reasons for redesign of layouts:
Inefficient operations E.g., high cost , bottlenecks, accidents or
safety hazards, changes in the design of products and services, introduction of new products or services.
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Objective of layout design
To facilitate a smooth flow of work, material, and information through the system.
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Supporting objectives involves the ff:
1. To facilitate attainment of product or service quality.2. To use workers and space efficiently3. To avoid bottlenecks4. To minimize material handling costs5. To eliminate unnecessary movements of workers or
materials6. To minimize production time or customer service time7. To design for safety.
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PRODUCT – FOCUSED STRATEGY
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48Product-Focused Strategy¨ Facilities are organized by product¨ High volume, low variety products¨ Where found
¨ Discrete unit manufacturing¨ Continuous process manufacturing
¨ Other names¨ Line flow production¨ Continuous production
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Product-Focused Strategy Advantages
Lower variable cost per unit Lower but more specialized labor skills Easier production planning and control Higher equipment utilization (70% to 90%)
Disadvantages Lower product flexibility More specialized equipment Usually higher capital investment
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Product-Focused Examples
© 1995 Corel Corp.
Light Bulbs (Discrete)
Paper (Continuous)
© 1984-1994 T/Maker Co.
© 1995 Corel Corp.
Soft Drinks (Continuous, then Discrete)
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REPETITIVE FOCUSED STRATEGY
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Repetitive Focused Strategy
Facilities often organized by assembly lines Characterized by modules
Parts & assemblies made previously Modules combined for many output options Other names
Assembly line Production line
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Repetitive Focused Strategy -Considerations
More structured than process-focused, less structured than product focused
Enables quasi-customization Using modules, it enjoys economic advantage of
continuous process, and custom advantage of low-volume, high-variety model
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Repetitive-Focused Strategy - Examples
© 1995 Corel Corp.
Clothes Dryer
© 1995 Corel Corp.
Fast Food
McDonald’sover 95 billion served
McDonald’sover 95 billion served
© 1984-1994 T/Maker Co.
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Product Layouts Are used to achieve a smooth and rapid
flow of large volumes of goods or customers through a system.
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Process Layout (functional)
Dept. A
Dept. B
Dept. C
Dept. D
Dept. E
Dept. F
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Production Line Standardized layout arranged according
to a fixed sequence of production tasks
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Production Line (flow line)Begin Work flow
EndRaw Materials
Finished line
Station 1
Station 2
Station a
Station b
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Assembly line Standardized layout arranged according
to a fixed sequence of assembly tasks
Tray Dessert Salads Main Course
Beverage
Cashier
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TOOLS FOR PROCESS DESIGN
Flow DiagramsProcess ChartsTime-Function/Process Mapping
Service Blueprinting
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Flow Diagram
Shipping
CustomerCustomer
sales representativ
etake orderPrepress
Department(Prepare printing
plates and negatives)Printing
DepartmentCollating Department
Gluing, binding, stapling, labelingPolywrap
Department
Purchasing(order inks, paper, other
supplies)VendorsReceiving
Warehousing(ink, paper, etc.)
Accounting
Information flowMaterial flow
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SUBJECT: Request tool purchase
Dist (ft) Time (min) Symbol Descriptionlðo DÑWrite order¡ðo D Ñ On desk
75 ¡ è oDÑTo buyer¡ðn DÑ Examine
¡ = Operation; ð = Transport; o = Inspect; D = Delay; Ñ = Storage
Process Chart Example
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Service Blueprint for Service at Ten Minute Lube, Inc.
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Attaining Lean Production
Focus on inventory reduction Build systems that help employees Reduce space requirements Develop close relationships with suppliers Educate suppliers Eliminate all but value-added activities Develop the workforce Make jobs more challenging Set sights on perfection!
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Techniques for Improving Service Productivity
Separation
Self-service
Postponement Focus
Structure service to customers must go where service is offered
Self-service to customers examine, compare and evaluate at their own pace
Customizing at delivery
Restricting the offerings
Strategy Technique65
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Techniques for Improving Service Productivity - Continued
Modules
Automation
Scheduling
Training
Modular selection of service. Modular production
Separating services that lend themselves to automation
Precise personnel scheduling Clarifying the service options Explaining problems Improving employee
flexibility
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More Opportunities to Improve Service Processes
Layout Human Resources Technology
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End of Powerpoint Presentation
Thank you!!!