Process development
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The document discusses process development, which involves planning and designing production processes based on inputs like product information, production systems, and operations strategies. Key factors that affect process development include the nature of product demand, degree of vertical integration, production flexibility, degree of automation, and product quality needs. The document outlines different types of process designs like product-focused, process-focused, and group technology approaches. It also discusses considerations around process reengineering.
Process development
- 2. 2 Inputs:Inputs: • Product/Service InformationProduct/Service Information • Production System InformationProduction System Information • Operations StrategyOperations Strategy Process Planning & Design:Process Planning & Design: • Process-Type SelectionProcess-Type Selection • Vertical Integration StudiesVertical Integration Studies • Process/Product StudiesProcess/Product Studies • Equipment StudiesEquipment Studies • Production Procedures StudiesProduction Procedures Studies • Facilities StudiesFacilities Studies Outputs:Outputs: • Process TechnologyProcess Technology • FacilitiesFacilities • Personnel EstimatesPersonnel Estimates •Process plansProcess plans Process Development SystemProcess Development System
- 3. 3 Major Factors Affecting Process DevelopmentMajor Factors Affecting Process Development I.I. Nature of product/service demandNature of product/service demand II.II. Degree of vertical integrationDegree of vertical integration III.III. Production flexibilityProduction flexibility IV.IV. Degree of automationDegree of automation V.V. Product/Service qualityProduct/Service quality
- 4. 4 Nature of Product DemandNature of Product Demand DemandDemand fluctuates over time andfluctuates over time and is affected by product price, so pricingis affected by product price, so pricing decisions and the choice of processes must bedecisions and the choice of processes must be synchronized.synchronized. Therefore,Therefore, Production processes must have adequateProduction processes must have adequate capacity to produce the volume of the productscapacity to produce the volume of the products that customers need.that customers need. Provisions must be made for expanding orProvisions must be made for expanding or contracting capacity to keep pace with demandcontracting capacity to keep pace with demand patterns.patterns. Some types of processes are more easilySome types of processes are more easily expanded and contracted than others.expanded and contracted than others.
- 5. 5 Degree of Vertical IntegrationDegree of Vertical Integration Vertical integrationVertical integration is the amount of theis the amount of the production and distribution chain that is broughtproduction and distribution chain that is brought under the ownership of a company.under the ownership of a company. This determines how many production processesThis determines how many production processes need to be planned and designed.need to be planned and designed. Decision of integration is based on cost,Decision of integration is based on cost, availability of capital, quality, technologicalavailability of capital, quality, technological capability, and more.capability, and more. Strategic outsourcingStrategic outsourcing (lower degree of(lower degree of integration) is the outsourcing of processes inintegration) is the outsourcing of processes in order to react quicker to changes in customerorder to react quicker to changes in customer needs, competitor actions, and technology.needs, competitor actions, and technology.
- 6. 6 Production FlexibilityProduction Flexibility Product flexibilityProduct flexibility -- ability of the production-- ability of the production (or delivery) system to quickly change from(or delivery) system to quickly change from producing (delivering) one product (or service)producing (delivering) one product (or service) to another.to another. Volume flexibilityVolume flexibility -- ability to quickly increase-- ability to quickly increase or reduce the volume of product( or service)or reduce the volume of product( or service) produced (or delivered).produced (or delivered).
- 7. 7 Degree of AutomationDegree of Automation Advantages of automationAdvantages of automation Improves product qualityImproves product quality Improves product flexibilityImproves product flexibility Reduces labor and related costsReduces labor and related costs Disadvantages of automationDisadvantages of automation Equipment can be very expensiveEquipment can be very expensive Integration into existing operations can beIntegration into existing operations can be difficultdifficult
- 8. 8 Product/Service QualityProduct/Service Quality Old viewpointOld viewpoint High-quality products must be made in smallHigh-quality products must be made in small quantities by expert craftsmenquantities by expert craftsmen New viewpointNew viewpoint High-quality products can be mass-produced usingHigh-quality products can be mass-produced using automated machineryautomated machinery Automated machinery can produce products ofAutomated machinery can produce products of incredible uniformityincredible uniformity The choice of design of production processes isThe choice of design of production processes is affected by the need for superior quality.affected by the need for superior quality.
- 9. 9 Types of Process DesignsTypes of Process Designs Product-FocusedProduct-Focused Process-FocusedProcess-Focused Group Technology/Cellular ManufacturingGroup Technology/Cellular Manufacturing
- 10. 10 Product-FocusedProduct-Focused Processes (conversions) are arranged based onProcesses (conversions) are arranged based on the sequence of operations required to produce athe sequence of operations required to produce a product or provide a serviceproduct or provide a service Also called “production line,” “assembly line,”Also called “production line,” “assembly line,” and flow lineand flow line Two general formsTwo general forms Discrete unit – automobiles, dishwashersDiscrete unit – automobiles, dishwashers Process (Continuous) – petrochemicals, paperProcess (Continuous) – petrochemicals, paper
- 11. 11 Process-FocusedProcess-Focused Processes (conversions) are arranged based onProcesses (conversions) are arranged based on the type of process, i.e., similar processes arethe type of process, i.e., similar processes are grouped togethergrouped together Products/services (jobs) move from departmentProducts/services (jobs) move from department (process group) to department based on that(process group) to department based on that particular job’s processing requirementsparticular job’s processing requirements Also called “job shop” or “intermittentAlso called “job shop” or “intermittent production”production” ExamplesExamples Machine shopMachine shop Auto body repairAuto body repair Custom woodworking shopCustom woodworking shop
- 12. 12 Group Technology/Cellular ManufacturingGroup Technology/Cellular Manufacturing Group TechnologyGroup Technology Each part produced receives a multi-digit codeEach part produced receives a multi-digit code that describes the physical characteristics of thethat describes the physical characteristics of the part.part. Parts with similar characteristics are groupedParts with similar characteristics are grouped into part familiesinto part families Parts in a part family are typically made on theParts in a part family are typically made on the same machines with similar toolingsame machines with similar tooling
- 13. 13 Product/Process Design & Inventory PolicyProduct/Process Design & Inventory Policy Standard Products and Produce to StockStandard Products and Produce to Stock Sales forecasts drive production scheduleSales forecasts drive production schedule Maintain pre-determined finished-goods levelsMaintain pre-determined finished-goods levels MRP forecast drives material orderingMRP forecast drives material ordering Custom Products and Produce to OrderCustom Products and Produce to Order Orders set production schedule and driveOrders set production schedule and drive material deliveriesmaterial deliveries Design time (pre-production planning) may beDesign time (pre-production planning) may be required before production can be scheduledrequired before production can be scheduled
- 14. 14 Process ReengineeringProcess Reengineering The concept of drastically changing an existingThe concept of drastically changing an existing process designprocess design Not merely making marginal improvements toNot merely making marginal improvements to the processthe process A correctly reengineered process should beA correctly reengineered process should be more efficientmore efficient A smaller labor force is often the resultA smaller labor force is often the result
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