lsm733-production operations management by: osman bin saif lecture 10 1
TRANSCRIPT
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LSM733-PRODUCTION OPERATIONS MANAGEMENT
By: OSMAN BIN SAIF
LECTURE 10
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Tools of TQMCheck SheetsScatter Diagrams Cause-and-Effect DiagramsPareto ChartsFlowchartsHistogramsStatistical Process Control (SPC)
Summary of Last Session
3
The Role of InspectionWhen and Where to InspectSource InspectionService Industry Inspection Inspection of Attributes versus
Variables
TQM in Services
Summary of Last Session (Contd.)
4
Tools for Generating IdeasCheck sheetsScatter diagramsCause-and-effect diagrams
Tools to Organize the DataPareto chartsFlowcharts
Tools for Identifying ProblemsHistogramStatistical process control chart
Summary of Last Session (Contd.)
5
Four Process Strategies
Process Focus
Repetitive Focus
Product Focus
Mass Customization Focus
Comparison of Process Choices Process Analysis and Design
Flow Diagrams Time-Function Mapping Value-Stream Mapping Process Charts Service Blueprinting
Agenda for this session
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Service Process Design Customer Interaction and Process Design More Opportunities to Improve Service Processes
Selection of Equipment and Technology Production Technology
Machine Technology Automatic Identification Systems (AISs) and RFID Process Control Vision Systems Robots
Agenda for this session (Contd.)
7
Production Technology (cont.) Automated Storage and Retrieval Systems (ASRSs) Automated Guided Vehicles (AGVs) Flexible Manufacturing Systems (FMSs) Computer-Integrated Manufacturing (CIM)
Technology in Services Process Redesign Ethics and Environmentally Friendly Processes
Agenda for this session (Contd.)
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Comparison of Processes
Process Focus
(Low volume, high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety)
Small quantity, large variety of products
Long runs, standardized product made from modules
Large quantity, small variety of products
Large quantity, large variety of products
General purpose equipment
Special equipment aids in use of assembly line
Special purpose equipment
Rapid changeover on flexible equipment
Table 7.2
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Comparison of Processes
Process Focus
(Low volume, high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety)
Operators are broadly skilled
Employees are modestly trained
Operators are less broadly skilled
Flexible operators are trained for the necessary customization
Many job instructions as each job changes
Repetition reduces training and changes in job instructions
Few work orders and job instructions because jobs standardized
Custom orders require many job instructions
Table 7.2
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Comparison of Processes
Process Focus
(Low volume, high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety)
Raw material inventories high
JIT procurement techniques used
Raw material inventories are low
Raw material inventories are low
Work-in-process is high
JIT inventory techniques used
Work-in-process inventory is low
Work-in-process inventory driven down by JIT, lean production
Table 7.2
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Comparison of Processes
Process Focus
(Low volume, high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety)
Units move slowly through the plant
Movement is measured in hours and days
Swift movement of unit through the facility is typical
Goods move swiftly through the facility
Finished goods made to order
Finished goods made to frequent forecast
Finished goods made to forecast and stored
Finished goods often build-to-order (BTO)
Table 7.2
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Comparison of Processes
Process Focus
(Low volume, high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety)
Scheduling is complex, trade-offs between inventory, availability, customer service
Scheduling based on building various models from a variety of modules to forecasts
Relatively simple scheduling, establishing output rate to meet forecasts
Sophisticated scheduling required to accommodate custom orders
Table 7.2
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Comparison of Processes
Process Focus
(Low volume, high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-variety)
Mass Customization
(High-volume, high-variety)
Fixed costs low, variable costs high
Fixed costs dependent on flexibility of the facility
Fixed costs high, variable costs low
Fixed costs high, variable costs must be low
Costing estimated before job, known only after the job
Costs usually known due to extensive experience
High fixed costs mean costs dependent on utilization of capacity
High fixed costs and dynamic variable costs make costing a challenge
Table 7.2
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Crossover 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 BFixed 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 7.6
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Focused Processes
Focus brings efficiency Focus on depth of product line rather
than breadth Focus can be
Customers Products Service Technology
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Changing Processes
Difficult and expensive May mean starting over Process strategy determines
transformation strategy for an extended period
Important to get it right
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Process Analysis and Design Flow Diagrams - 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
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“Baseline” Time-Function Map
Customer
Sales
Production control
Plant A
Warehouse
Plant B
Transport Move
Receive product
Extrude
Wait
Move
Wait
Wait
Order product
Process order
Wait
12 days 13 days 1 day 4 days 1 day 10 days 1 day 0 day 1 day
52 daysFigure 7.7
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“Target” Time-Function Map
Customer
Sales
Production control
Plant
Warehouse
Transport Move
Receive product
Extrude
Wait
Order product
Process order
Wait
1 day 2 days 1 day 1 day 1 day6 days
Figure 7.7
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Value-Stream Mapping
Figure 7.8
Process Chart
Figure 7.9
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Service Blueprint
Focuses on the customer and provider interaction
Defines three levels of interaction Each level has different management
issues Identifies potential failure points
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Notify customer the car is ready
Customer departs
Customer pays bill
F
F
Service BlueprintPersonal Greeting Service Diagnosis Perform Service Friendly Close
Level#3
Level#1
Level#2
Figure 7.10
No
Notifycustomer
and recommendan alternative
provider
Customer arrives for service
Warm greeting and obtain service
request
F
Direct customer to waiting room
F
Perform required work
Prepare invoice
YesYes
F
F
Standard request
Determine specifics
No
Canservice be
done and does customer approve?
F F
Process Analysis Tools Flowcharts provide a view of the big
picture Time-function mapping adds rigor and a
time element Value-stream analysis extends to
customers and suppliers Process charts show detail Service blueprint focuses on customer
interaction
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Service Factory Service Shop
Degree of CustomizationLow High
Deg
ree
of L
abor
Low
High
Mass Service Professional Service
Service Process Matrix
Commercial banking
Private banking
General-purpose law firms
Law clinicsSpecialized hospitals
Hospitals
Full-service stockbroker
Limited-service stockbroker
RetailingBoutiques
Warehouse and catalog stores
Fast-food restaurants
Fine-dining restaurants
Airlines
No-frills airlinesFigure 7.11
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Service Process Matrix
Labor involvement is high Selection and training highly important Focus on human resources Personalized services
Mass Service and Professional Service
Service Factory and Service Shop Automation of standardized services Low labor intensity responds well to process
technology and scheduling Tight control required to maintain standards
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Improving Service Productivity
Strategy Technique Example
Separation Structure service so customers must go where service is offered
Bank customers go to a manager to open a new account, to loan officers for loans, and to tellers for deposits
Self-service Self-service so customers examine, compare, and evaluate at their own pace
Supermarkets and department stores, Internet ordering
Table 7.3
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Strategy Technique Example
Postponement Customizing at delivery
Customizing vans at delivery rather than at production
Focus Restricting the offerings
Limited-menu restaurant
Modules Modular selection of service, modular production
Investment and insurance selection, prepackaged food modules in restaurants
Improving Service Productivity
Table 7.3
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Strategy Technique Example
Automation Separating services that may lend themselves to automation
Automatic teller machines
Scheduling Precise personnel scheduling
Scheduling ticket counter personnel at 15-minute intervals at airlines
Training Clarifying the service options, explaining how to avoid problems
Investment counselor, funeral directors, after-sale maintenance personnel
Improving Service Productivity
Table 7.3
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Improving Service Processes
LayoutProduct exposure, customer education,
product enhancement Human Resources
Recruiting and training Impact of flexibility
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Equipment and Technology
Often complex decisions Possible competitive advantage
Flexibility Stable processes
May allow enlarging the scope of the processes
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Production 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)
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Machine Technology
Increased precision Increased productivity Increased flexibility Improved environmental impact Reduced changeover time Decreased size Reduced power requirements
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Automatic Identification Systems (AISs)
Improved data acquisition Reduced data entry errors Increased speed Increased scope
of process automation
Example – Bar codes and RFID
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Process Control
Increased process stability Increased process precision Real-time provision of information for
process evaluation Data available in many forms
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Process Control Software
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Vision Systems
Particular aid to inspection Consistently accurate Never bored Modest cost Superior to individuals performing the
same tasks
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Robots
Perform monotonous or dangerous tasks Perform tasks requiring significant
strength or endurance Generally enhanced consistency and
accuracy
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Automated Storage and Retrieval Systems (ASRSs)
Automated placement and withdrawal of parts and products
Reduced errors and labor Particularly useful in inventory and test
areas of manufacturing firms
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Automated Guided Vehicle (AGVs)
Electronically guided and controlled carts Used for movement of products and/or
individuals
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Flexible Manufacturing Systems (FMSs)
Computer controls both the workstation and the material handling equipment
Enhance flexibility and reduced waste Can economically produce low volume at high
quality Reduced changeover time and increased
utilization Stringent communication requirement between
components
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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
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Computer-Integrated
Manufacturing (CIM)
Figure 7.12
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Technology in ServicesService Industry Example
Financial Services
Debit cards, electronic funds transfer, ATMs, Internet stock trading
Education Electronic bulletin boards, on-line journals, WebCT and Blackboard
Utilities and government
Automated one-man garbage trucks, optical mail and bomb scanners, flood warning systems
Restaurants and foods
Wireless orders from waiters to kitchen, robot butchering, transponders on cars that track sales at drive-throughs
Communications Electronic publishing, interactive TV
Table 7.4
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Technology in ServicesService Industry Example
Hotels Electronic check-in/check-out, electronic key/lock system
Wholesale/retail trade
ATM-like kiosks, point-of-sale (POS) terminals, e-commerce, electronic communication between store and supplier, bar coded data
Transportation Automatic toll booths, satellite-directed navigation systems
Health care Online patient-monitoring, online medical information systems, robotic surgery
Airlines Ticketless travel, scheduling, Internet purchases
Table 7.4
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Process Redesign The fundamental rethinking 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 functional lines Any process is a candidate for redesign
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Ethics and Environmentally Friendly Processes
Encourage recycling Efficient use of resources Reduction of waste by-products Use less harmful ingredients Use less energy
Reduce the negative impact on the environment
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Four Process Strategies
Process Focus
Repetitive Focus
Product Focus
Mass Customization Focus
Comparison of Process Choices Process Analysis and Design
Flow Diagrams Time-Function Mapping Value-Stream Mapping Process Charts Service Blueprinting
Summary of this session
49
Service Process Design Customer Interaction and Process Design More Opportunities to Improve Service Processes
Selection of Equipment and Technology Production Technology
Machine Technology Automatic Identification Systems (AISs) and RFID Process Control Vision Systems Robots
Summary of this session (Contd.)
50
Production Technology (cont.) Automated Storage and Retrieval Systems (ASRSs) Automated Guided Vehicles (AGVs) Flexible Manufacturing Systems (FMSs) Computer-Integrated Manufacturing (CIM)
Technology in Services Process Redesign Ethics and Environmentally Friendly Processes
Summary of this session (Contd.)
51
THANK YOU