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Islamic University of Gaza - Palestine
Chapter 6: Process Selection and Facility Layout
Department of Industrial Engineering
Islamic University of Gaza - Palestine
Chapter 6: Learning Outcomes
• When you complete this chapter, you should be able to :
Identify or Define:– Process focus– Repetitive focus– Product focus– Process reengineering– Service process issues
Describe or Explain:– Production technology– Process automation– The need for management of technology– Some reasons for redesign of layouts
– Solve simple line-balancing problems
– Develop simple process layouts
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Dell Computer Company
“How can we make the process of buying a computer better?”
• Sell custom-build PCs directly to consumer• Integrate the Web into every aspect of its business• Operate with six days inventory• Build computers rapidly, at low cost, and only when ordered• Focus research on software designed to make installation and
configuration of its PCs fast and simple
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Production Process Flow Diagram
Shipping
Customer
Customer sales representative
(take order)
Prepress Department(Prepare printing
plates & negatives)
Printing Department
Collating Department
Gluing, binding, stapling, labeling
Poly-wrap Department
Purchasing(order inks, paper, other
supplies)
Vendors
Receiving
Warehousing(ink, paper, etc.)
Accounting
Information flowMaterial flow
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Process Selection
• Process selection
– Refers to the deciding on the way production of goods or services will be organized
– It has major implications for
• Capacity planning
• Layout of facilities
• Equipment
• Design of work systems
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Technology
• Technology
– The application of scientific discoveries to the development and improvement of products and services and operations processes
• Technological Innovation
– The discovery and development of new or improved products, services, or processes for producing or providing them
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Technology Acquisition
• Technology acquisition decisions must be weighed carefully
– What are the upside and downsides of the technology?
– What can and can’t a technology do?
– Economic considerations
– Integration considerations
– Human considerations
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Process Strategies
• Involve determining how to produce a product or provide a service
• Objective
– Meet or exceed customer requirements
– Meet cost & managerial goals
• Has long-run effects
– Product & volume flexibility
– Costs & quality
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Fit of Process, Volume, and Variety
Process focusprojects, job
shops,(machine, print, carpentry)
Standard RegisterRepetitive
(autos, motorcycles)Harley Davidson
Product focus(commercial baked goods, steel, glass)
Nucor Steel
High VarietyOne or few units per run, high variety(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 Co.
Poor strategy
Low-Volume(Intermittent)
Repetitive Process(Modular)
High-Volume(Continuous)
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Process Selection
1. Variety
– How much?
2. Equipment flexibility
– To what degree?
3. Volume
– Expected output?
Job Shop
Repetitive
Batch
Continues
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Types of Process Strategies
ContinuumContinuum
♦ Process strategies that follow a continuum
♦ Within a given facility, several strategies may be used
♦ These strategies are often classified as:
Repetitive-Focused Product-FocusedProcess-Focused
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Process-Focused Strategy
♦ Facilities are organized by process
♦ Similar processes are together
♦ Example: All drill presses are together♦ Low volume, high variety products
♦ ‘Jumbled’ flow
Operation
Product A
Product B
11 22 33
♦ Other names
♦ Intermittent process
♦ Job shop
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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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Process Focused Strategy - Pros & Cons
• Advantages– Greater product flexibility
– More general purpose equipment
– Lower initial capital investment
• Disadvantages– High variable costs
– More highly trained personnel
– More difficult production planning & control
– Low equipment utilization (5% to 25%)
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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
Truck
© 1995 Corel Corp.
Clothes Dryer
© 1995 Corel Corp.
Fast Food
McDonald’sover billion served
McDonald’sover 95 billion served
© 1984-1994 T/Maker Co.
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Product-Focused Strategy
♦ Facilities are organized by product
♦ High volume, low variety products
♦ Where found
♦ Discrete unit manufacturing
♦ Continuous process manufacturing
Operation
Products A & B
1 2 3
♦ Other names
♦ Line flow production
♦ Continuous production
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Product-Focused Examples
Light Bulbs (Discrete)
Paper (Continuous)
Soft Drinks (Continuous, then Discrete)
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Product-Focused Strategy - Pros & Cons
• 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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Process Strategies
Rapid throughput techniques
Mass Customization
Modular techniques
Repetitive FocusModular design
Flexible equipment
Product-focusedLow variety, high volume
High utilization (70% - 80%)Specialized equipment
Process-focusedHigh variety, low volumeLow utilization (5% - 20%)
General purpose equipment
Effective scheduling techniques
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Process Continuum
Process Focused(intermittent process)
Repetitive Focus(assembly line)
Product Focused
(continuous process)
Continuum
High variety, low volumeLow utilization (5% - 25%)
General-purpose equipment
Low variety, high volumeHigh utilization (70% - 90%)
Specialized equipment
Modular
Flexible equipment
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Questions for Process Analysis and Design
• Is the process designed to achieve competitive advantage in terms of differentiation, response, or low cost?
• Does the process eliminate steps that do not add value?
• Does the process maximize customer value as perceived by the customer?
• Will the process win orders?
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Automation
• Automation
– Machinery that has sensing and control devices that enable it to operate automatically
• Fixed automation
• Programmable automation
• Flexible automation
• Improved data acquisition
• Increased scope of process automation
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Automation Questions
1. What level of automation is appropriate?
2. How would automation affect system flexibility?
3. How can automation projects be justified?
4. How should changes be managed?
5. What are the risks of automating?
6. What are the likely effects of automating on:
– Market share
– Costs
– Quality
– Customer satisfaction
– Labor relations
– Ongoing operations
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Machine Technology
• Increased precision
• Increased productivity
• Increased flexibility !
• Decreased pollution !
• Decreased size !
• Decreased power requirements
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Automation Technologies
• Computer-Aided Manufacturing (CAM)
– The use of computers in process control, ranging from robots to automated quality control
• Numerically Controlled (N/C) Machines– Machines that perform operations by following mathematical
processing instructions
• Robot– A machine consisting of a mechanical arm, a power supply,
and a controller
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Process Control
• Increased process stability
• Increased process precision
• Real-time provision of information for process evaluation
• Multi-mode information presentation
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Vision Systems
• Particular aid to inspection
• Consistently accurate
• Never bored (getting tired)
• Modest cost
• Better for individuals, who are performing the same tasks
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Robots
• Perform monotonous, or dangerous tasks, or those requiring significant strength or endurance
• Enhanced consistency, accuracy, speed strength, power when substituted for human effort
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Automated Storage and Retrieval Systems (ASRS)
• Automated placement and withdrawal (taking out) of parts and products
• Particularly useful in inventory and test areas of manufacturing firms
Automated Guided Vehicle (AGV)
Electronically controlled movement of products and/or individuals
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FMS and CIM
• FMS (Flexible Manufacturing System)
– A group of machines designed to handle intermittent ( irregular) processing requirements and produce a variety of similar products
• CIM (Computer Integrated Manufacturing)
– A system for linking a wide range of manufacturing activities through an integrated computer system
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Flexible Manufacturing Systems (FMS)
• Computer controls both the workstation and the material handling equipment
• Computer control enhance flexibility
• Can economically produce low volume at high quality
• Reduced costs of changeover and low utilization
• Stringent communication requirement between components within it
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Computer Integrated Manufacturing (CIM)
• Extension of flexible manufacturing systems
– Backwards to engineering and inventory control
– Forward into warehousing and shipping
– Can also include financial and customer service areas
• Reducing the distinction between low-volume/high-variety, and high-volume/low-variety production
• Heavy reliance on information technology
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Computer Integrated Manufacturing
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Technology in Services
Service Industry Example
Financial services Debit cards, electronic funds transfer, ATMs, Internet stock trading
Education Electronic bulletin boards, on-line journals
Utilities and government
Automated one-man garbage trucks, optical mail sorters, scanners, flood warning systems
Restaurants and foods
Wireless orders from waiters to kitchen, robot butchering, transponders on cars to track drive-thrus
Communication Electronic publishing, interactive TV
Hotels Electronic check-in/check-out, electronic key/lock systems
Wholesale/retail trade
Point-of-sale terminals, e-commerce, electronic communication between store and supplier, bar coded data
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Technology in Services - Continued
Service Industry Example
Transportation Automatic toll booths, satellite-directed navigation systems, route planning, progress monitoring
Health care On-line patient monitoring, on-line medical information systems, robotic surgery, expert system diagnosis assistance
Airlines Ticketless travel, scheduling, Internet ticket sales, improved navigation and route planning
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Business Process Reengineering
• The fundamental rethinking and radical redesign of business processes to bring about dramatic improvements in performance
• Relies on reevaluating the purpose of the process and questioning both the purpose and the underlying assumptions
• Requires reexamination of the basic process and its objectives
• Focuses on activities that cross boundaries ,
• The actual implementation of BPR often results in failure
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Facilities Layout
• Layout
– the configuration of departments, work centers, and equipment, with particular emphasis on movement of work (customers or materials) through the system
– Facilities layout decisions arise when:
• Designing new facilities
• Re-designing existing facilities
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Basic Layout Types
• Product layouts
• Process layouts
• Fixed-Position layout
• Combination layouts
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Designing Product Layouts: Line Balancing
• The goal of a product layout is to arrange workers or machines in the sequence that operations need to be performed
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Line Balancing
• Line balancing
– The process of assigning tasks to workstations in such a way that the workstations have approximately equal time requirements
– 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.
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Designing Process Layouts
• The main issue in designing process layouts concerns the relative placement of the departments
• Measuring effectiveness
– A major objective in designing process layouts is to minimize transportation cost, distance, or time
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Tools for Process Design
• Flow Diagrams
• Process Charts
• Time-Function/Process Mapping
• Work Flow Analysis
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End of Chapter 6
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A Comparison (1)
Process Focus
(Low volume, High variety)
Repetitive Focus
(Modular)
Product focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety
1. Small quantity, large variety of products
Long runs, standardized product, from modules
Large quantity, small variety of products
Large quantity, large variety of products
2. General purpose equipment
Special equipment aids in use of assembly line
Special purpose equipment
Rapid changeover on flexible equipment
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Process Focus Repetitive Focus Product focus Mass Customization
3. Broadly skilled operators
Modestly trained employees
Operators less broadly skilled
Flexible operators trained for customization
4. Many instructions because of change in jobs
Reduced training and number of job instructions
Few work orders and job instructions
Custom orders require many instructions
5. Raw material high relative to product value
JIT techniques used
Raw material low relative to product value
Raw material low relative to product value
A Comparison (2)
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Process Focus Repetitive Focus Product focus Mass Customization
6. WIP high relative to output
JIT techniques used WIP low relative to output
WIP driven down by JIT, kanban, lean production
7. Units move slowly thru plant
Movement measured in hours & days
Units move swiftly thru facility
Goods move swiftly thru facility
8. Finished goods made to order, not stored
Finished goods made to frequent forecasts
Finished goods made to forecast, then stored
Finished goods made to order
A Comparison (3)
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Process Focus Repetitive Focus Product focus Mass Customization
9. Scheduling complex and concerned with trade-off between inventory, capacity, and customer service
Scheduling based on building models from a variety of forecasts
Scheduling relatively simple, concerns establishing sufficient rate of output to meet forecasts
Scheduling sophisticated to accommodate customization
10. Fixed costs low, variable costs high
Fixed costs dependent on flexibility of facilities
Fixed costs high, variable costs low
Fixed costs high; variable costs must be low
A Comparison (4)
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Process Focus Repetitive Focus Product focus Mass Customization
11. Costing, done by job, is estimated prior to doing job but only known after doing job
Costs usually known based on experience
Because of high fixed costs, cost dependent on utilization of capacity
High fixed costs and dynamic variable costs
A Comparison (5)
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Factors Affecting Process Alternatives
♦ Production flexibility
♦ Product volume
♦ Product variety
♦ Technology
♦ Cost
♦ Human resources
♦ Quality
♦ Reliability
These factors reduce the number of alternatives!
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