process selection – unit 5

7/23/2019 Process Selection UNIT 5

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Process Selection unit 5


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Inputs:Product/Service InformationProduction System InformationOperations Strategy

Process Selection & Design:Process-Type SelectionVertical Integration Studies

Process/Product StudiesEuipment StudiesProduction Procedures Studies!acilities Studies

Outputs:

Process Tec"nology!acilitiesPersonnel Estimates

Process Selection and Design


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Process Selection and SystemDesign

Forecasting

Product and

Service Design

Technological

Change

Capacity

Planning

ProcessSelection

Facilities and

Equipment

Layout

Work

Design


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e process-focused Project ShopCharacteristics Unique products with certain complexity (boats, aircrafts, ships,

hotels, bridges, sports stadiums) he production process is managed li!e a pro"ect #a!es a one$of$a$!ind product (%olume & ') Uses general purpose equipment as informal relationships with many %endors ery little %ertical integration

*lexible layout often with factors of production mo%ing to "ob


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TheJob Shop+ process structure suited for low %olume production of a great %ariety

of non$standard products (highly customied products)-

Custom or wor!shop. /ow specialied operations carried out by thesame wor!er or group of wor!ers that follow up the whole processfor the order-

0atch. #ore specialied operations carried out by di1erentwor!ers or group of wor!ers (need for more specialiationand standardiation)-

Characteristics'- #a!es many products in small %olume2- Uses general purpose equipment, grouped by the same function in

3or! Centres4- as informal relationships with %endors5- ery little %ertical integration6- 7epartmentalied layout with chaotic 8ow
http://d/pielsa.mpghttp://d/pielsa.mpg


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The Large Batch (Cell,Flow Shopor Hybrd Shop!

+ process structure that produces a %ariety ofstandard products at relati%ely low %olumes-his %ariety of standard products has a similarsequence of operations.he equipment is laid out in line, instead ofgrouped by the same function-+fter completing one batch, equipmentad"ustments for the next one are made andthe next batch produced-

Characteristics'-#a!es se%eral families of products in

moderate %olume2-Uses general purpose equipment oftencustomied4-/ittle %ertical integration5-9imilar product follows the same path,produced in batches to reduce the impact of

setup time-6-ybrid layout with 8ow lines
http://d/gres%20de%20nules.mpghttp://d/gres%20de%20nules.mpg


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+ process structure designed to ma!e discrete parts- :artsare mo%ed through a set of specially designed

wor!stations at a controlled rate-Characteristics

'-#a!es few products in large %olume2-Uses specialied high$%olume equipment4-as formal relationships with %endors

5-#ay use %ertical integration6-:roduct$based layout with linear 8ow

"sse#bly L$e
http://d/ponepuerta.mpghttp://d/ponepuerta.mpg


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Continuous Flow+n often automated structure that con%erts

raw materials into ;nished products in onecontinuous process- 9ame operations are made in the same equipment

to ma!e the same product, reducing waiting time-


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Types of Processes *lexibility and Costs

0y :ro"ects

>ob 9hop

*low 9hop +ssembly /ine

Continuous

*lexibility

*ixed Costariable Cost

Unit Cost

+

- +

-


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Process Strategy in theindustry #anufacturing :rocess /ife Cycle

:rocesses go through di1erent phases as productsdo-

=nterdependency between :roduct and:rocess /ife Cycles. :rocess /ife Cycle. +1ects manufacturing costs,

quality and production %olumes, which a1ectssales %olumes-

:roduct /ife Cycle. =n8uences the type of

manufacturing process that can be economicallyand ;nancially "usti;ed-


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rocess ra egy n eindustry :roduct$:rocess #atrix

=-Continuous

*low

===-+ssembly

/ine

==-0atch

=->ob9hop

/owolume,


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Underlying Process elationship !etween"olume and Standardi#ation Continuum


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Di$erences %etween &ntermittentand Continuous 'perations

Decision &ntermittent 'peration Continuous 'peration

:roduct %ariety Ereat 9mall

7egree of standardiation /ow (igh


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(a)or Factors *$ecting ProcessSelection


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Degree of "ertical&ntegration ertical integration is the amount of the

production and distribution chain that isbrought under the ownership of a company-

his determines how many production

processes need to be planned and designed- 7ecision of integration is based on cost,a%ailability of capital, quality, technologicalcapability, and more-

9trategic outsourcing (lower degree of integration) isthe outsourcing of processes in order to react quic!erto changes in customer needs, competitor actions,and technology-


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Production Flei%ility

+ production process is more 8exible when theirequipment and human resources are able tomanage a wider %ariety of products, outputs,responsibilities and functions, at a reasonable cost

and time frame- :roduct 8exibility $$ ability of the production

(or deli%ery) system to quic!ly change fromproducing (deli%ering) one product (or

ser%ice) to another- olume 8exibility $$ ability to quic!ly

increase or reduce the %olume ofproduct( or ser%ice) produced (or deli%ered)-


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Degree of *utomation

+d%antages of automation =mpro%es product quality

=mpro%es product 8exibility

Aeduces labor and related costs

7isad%antages of automation @quipment can be %ery expensi%e

=ntegration into existing operations can be diFcult


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Factors a$ecting ProcessSelection Capital =n%estment

Combination of equipment and human resourcesat the manufacturing process-

he new manufacturing technologies pro%ide awide %ariety of a%ailable options.

+s the mechanical andGor automated operationsincrease, more capital is required-

#ost of the a%ailable options require a high capitalin%estment, which create a high ris! in case our sales%olumes (and therefore our production %olumes) are

lower than the expected-


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Factors a$ecting ProcessSelection Hature of the demand

#anufacturing processes ha%e to ha%e the necessary capacity tosupport the demand of products and ser%ices that the company isgoing to o1er-

9easonality, tendency and other characteristics of the demand aregoing to a1ect the capacity required o%er the time- 9ome processes are able to expand and contract more easily than others-

he ;nal selection of processes will be a1ected by the estimateddemand-

:rice. =f itIs high, consumers will tend to buy less and %ice %ersa-

o ;x the price, the company has to ta!e into account factors li!e

ad%ertising costs, sales force, ;nancial conditions, ser%ices pro%ided tothe customer, speci;c designs, in%entory and deli%ery policy, quality,etc-, at the same time than the costs related to manufacturing-

=t should be coordination between product price and process selection,due to the competiti%e ad%antages pro%ided by the di1erent types ofprocesses


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Factors a$ecting ProcessDesign Juality of the product or ser%ice

Juality is a competiti%e ad%antage in the currentbusiness en%ironment- he le%el of quality to be o1ered will a1ect directly the

selection of the production process-

he le%el required is directly related to the le%el of automation

of the process, since the automatic equipment manufacturesproducts with a high and consistent uniformity-

Customer participation

9er%ices that require higher contact with the customergenerally need less capital in%estment and ha%e more

8exibility- Customer presence normally a1ects the process

eFciency in a negati%e way, which increases cost-


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Factors a$ecting ProcessDesign he /earning e1ect

he wor!ing hours required per unit of product represent adecreasing function of the number of cumulati%e productionunits-

his reduction of wor!ing hours (and therefore cost) arebased on the gain of experience in design of products and

ser%ices, automation and capital in%estment, as well aschanges in methods and experience of the wor!ing force-

Companies competing in price try to ha%e highmanufacturing %olumes to ta!e ad%antage of the learninge1ect, and therefore ha%e a lower cost-

:roduction %olume

3or!ing

hoursper

unit


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B 2D 3iley

Designing Process Flow

:rocess design tools include :rocess 8ow analysis

:rocess 8owchart

7esign considerations include #a!e$to$stoc! strategy

+ssemble$to$order strategy

#a!e$to$order strategy


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B 2D 3iley

Process Design Tools

Process ,ow analysisis a tool used to analyeand document thesequence of steps withina total process- Usually

;rst step in :rocessAeengineering-

Process e-engineeringis astructured approachused when ma"orbusiness changes are

required as a result of. #a"or new products Juality impro%ement

needed 0etter competitors =nadequate

performance


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B 2D 3iley

Facility ayout and ProcessChoice


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'peration

!egin or end

&nformation

input

&nformationoutput

9hampoo directions'- /ather

2- Ainse4- Aepeat

:rocess 7ocumentation using *lowcharts

asic 8owchart symbols

@xample. +ny problems

with the followingset of directionsK

.uestionyes/no0

Shampoo0

!egin shampoo

inse hair withwarm water

ather shampoointo hair

Select %ottle

1et hair with

warm water

&nformation

on %ottle

2o

3es

4air

clean0

2ond shampoo

3es


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:rocess *low 7iagram (:*7)* process ,ow diagram is a mapping of the speci6c processes that raw materials7 parts7 and su%assem%lies follow as they mo8ethrough a plant9

0uilds on the concept of 8owcharting-

*cti8ity

* more constrained 8ersion of the operation sym%ol used in ,owcharting:9 e;uires a resource


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S$gle %bject Process Chart


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"sse#bly Process Chart Assembly charts

Disassembly charts


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"cto$ &ecso$ Flow &agra#


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4ow *re Ser8ices Di$erent from(anufacturing 9er%ices are di1erent from manufacturing

as theyL :roduce intangible products

=n%ol%e a high degree of customer contact

ype of ser%ice is classi;ed according todegree of customer contact


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Process Selection inSer8ices 9ome of the factors important in process

design for products are also important inser%ices. /e%el of customer contact

Hature (le%el and pattern) of customer demand

9er%icing 8exibility

7egree of automation

9er%ice quality


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Process Design in Ser8ices

hree schemes for producing and deli%eringser%ices /ow degree of customer contact $ Juasi$

#anufacturing

#edium degree of Customer contact M mixedser%ice

igh degree of customer contact M :ure ser%ice

Customer $as$:articipant

Customer$as$:roduct


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Juasi$#anufacturing :hysical goods are dominant o%er intangible

ser%ice

:roduction of goods ta!es place along a

production line


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Customer$as$:articipant :hysical goods may be a signi;cant part of the

ser%ice

9er%ices may be either standardied or custom

igh degree of customer in%ol%ement in theprocess

@xamples. +#, self$ser%ice gas station


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Customer$as$:roduct hrough personal attention to the customer

Customied ser%ice on the customer

igh degree of customer contact

here is a perception of high quality Customer becomes the central focus of the

process design

@xamples. ospital care, medical clinic, hairsalon

N$4O


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Ser8ice StrategyB Focus *d8antage

Ser8ice-System Design (atri

Ser8ice !lueprinting Ser8ice Fail-sa6ng Characteristics of a 1ell-Designed

Ser8ice Deli8ery System

OBJECTIVES

N$4D


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9er%ice 0usinesses

Facilities-%ased ser8icesB 1here the

customer must go to the ser8ice facility 4ospitals7 Schools/colleges7 *T(s

Field-%ased ser8icesB 1here the productionand consumption of the ser8ice ta@es place

in the customers en8ironment loan melas7census count7 water/electricity supply9

+ ser%ice businessis the management oforganiations whose primary business requiresinteraction with the customer to produce theser%ice

N$4N


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he Customer Centered iew

heCustomer

he 9er%ice9trategy

he:eople

he9ystems

A philosophical view that

suggests the organization

exists to serve the

customer, an the

s!stems an the

emplo!ees exist to

"acilitate the process o"

service#

A philosophical view that

suggests the organization

exists to serve the

customer, an the

s!stems an the

emplo!ees exist to

"acilitate the process o"

service#

N$4P


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9er%ice$9ystem 7esign #atrix

#ail contact

!ace-to-face

loose specs

!ace-to-face

tig"t specsP"one

$ontact

!ace-to-face

total

customi%ation

uffered

core 'none(

Permea)le

system 'some(

*eactive

system 'muc"(

+ig"

,o+ig"

,o

Degree of customer/server contact

Internet &

on-site

tec"nology

Sales

Opportunity

Production

Efficiency

N$5


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Characteristics of 3or!ers,


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@xample of 9er%ice 0lueprinting M /ine of interaction, line of%isibility, front oFce, bac! oFce

&rus"

s"oes

.pply

polis"

!ail

point

&uff $ollect

payment

$lean

s"oes #aterials

'e/g/0 polis"0 clot"(

Select and

purc"ase

supplies

Standard

e1ecution time

2 minutes

Total accepta)le

e1ecution time3 minutes

45

secs

45

secs

63

secs

73

secs

8rong

color -a1

Seen )y

customer 63

secs

,ine of

visi)ility

9ot seen )y

customer )ut

necessary to

performance

N$52


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9er%ice *ail$sa;ngPoka-Yokes (A Proactive Approach)

Eeeping amista@e from%ecoming a

ser8ice defect

4ow can wefail-safe the

three Ts0

as!

angiblesreatment

N$54


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hree Contrasting 9er%ice 7esigns

The production line approach>e9 (cDonalds?

The self-ser8ice approach >e9automatic teller machines?

The personal attentionapproach >e9 it#-Carlton4otel Company?

N$55


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Characteristics of a 3ell$7esigned 9er%ice 9ystem

:9 ach element of the ser8icesystem is consistent with theoperating focusof the 6rm


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Characteristics of a 3ell$7esigned 9er%ice 9ystem (Continued)

59 &t pro8ides e$ecti8e links%etween the %ac@ oGce and thefront oGce so that nothing falls%etween the crac@s

H9 &t manages the evidenceofser8ice ;uality in such a waythat customers see the 8alue ofthe ser8ice pro8ided

I9 &t is cost-eective

N$5O


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+pplying 0eha%ioral 9cience to 9er%ice @ncounters

:9 The front-end and %ac@-end of theencounter are not created e;ual


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9er%ice Euarantees as 7esign 7ri%ers

ecent research suggestsB *ny guarantee is %etter than no

guarantee

&n8ol8e the customer as well asemployees in the design

*8oid compleity or legalisticlanguage

Do not ;ui%%le or wriggle when acustomer in8o@es a guarantee

(a@e it clear that you are happy forcustomers to in8o@e the guarantee

process selection – unit 5

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