Module-2: Process Selection & Supply Chain Design

Mod: 2-2Processes & Technologies

Learning Outcomes

After going through this topic, you should be able to:

• Explain how manufacturing processes run

• Suggest appropriate technologies for different stages of

manufacturing process

• Identify and classify the wastes of a production uni

• Represent processes in a digital manufacturing environment

(PLM focus)

3

Operations strategy: Improve Speed to Market

Simultaneous (Concurrent) Engineering

Economic and TechnicalFeasibility Studies

Product/Service Ideas

Production Process DesignProduct/Service Design

Production and MarketingNew Product/Service

ContinuousInteraction

4

ProcessPlanning and Design

5

Process Planning and Design System

Inputs:• Product/Service Information

• Production System Information

• Operations Strategy

Process Planning & Design:• Process-Type Selection

• Vertical Integration Studies• Process/Product Studies

• Equipment Studies• Production Procedures Studies

• Facilities Studies

Outputs:• Process Technology • Facilities• Personnel

Estimates

6

Some Production ProcessesMetal-working Processes

Assembly Casting & Molding Cutting Forming Finishing

Brazing

Cementing

Fastening

Press-fitting

Shrink-fitting

Soldering

Welding

Die casting

Sand casting

Investment casting

Injection molding

Powder-metal molding

Permanent molding

Broaching

Drilling

Grinding

Honing

Milling

Shaping

Turning

Drawing

Extrusion

Punching

Rolling

Trimming

Swaging

Spinning

Blasting

Buffing

Cleaning

Deburring

Heat treatment

Painting

Polishing

7

Some Production ProcessesNon-metal-working Processes

Chemical Food Processing Mining Textiles Lumber

Cracking

Cooking

Curing

Distillation

Evaporation

Grinding

Screening

Canning

Cooking

Crushing

Freezing

Pasteurization

Press

Sterilization

Drying

Crushing

Excavation

Extraction

Loading

Screening

Smelting

Braid

Knit

Polish

Shrink

Spin

Wash

Weave

Debark

Cure

Join

Kiln

Plane

Saw

Turn

Process Flow Design

• A process flow design can be defined as a mapping of the specific processes that raw materials, parts, and sub-assemblies follow as they move through a plant

• The most common tools to conduct a process flow design include assembly drawings, assembly charts, and operation and route sheets

Material Received from

Supplier

Inspect Material for

DefectsDefects found?

Return to Supplier for

Credit

Yes

No, Continue…

Example: Process Flow Chart

Example: Assembly Chart (Gozinto)

A-2SA-2

4

5

6

7

Lock ring

Spacer, detent spring

Rivets (2)

Spring-detent

I-5

Component/Assy Operation

Inspection

OPERATIONS & ROUTE SHEET Material specifications ------------Purchased stock size -----------Pieces per purchase -----------Weight -----------

Part name -----Usage -----Assy. No. -----Sub Assy. No. ---

Part No. -------Date issued --------Date supplied ------Issued by --------

Opr No.

Operation Description Dept Machine Setup Hr.

Rate Pc. Hr.

Tools

20 Drill hole .32+.015

-.005Drill M/c. 513

Drill1.5 254 Drill fixture L-76

Jig # 10393

30 Deburr .312+.015 dia. hole

-.005

Drill M/c. 510Drill

.1 424 Multi-tooth burring tool

40 Chamfer .009/875. bore.878/.875 dia.

(2 passes. bore. 7600/7625 (1 pass)Lathe M/c. D109

Lathe1.0 44 Ramet-1, TPG 221, Chamfer

tool

50 Tap hole as designed ¼ min. full thread Tap M/c. 517Drill tap

2.0 180 Fixture # CR/353 tap. 4 flute sp.

60 Bore hole 1.33 to 1.138 dia. Lathe H & HE 107

3.0 158 L44 turret fixture Hartford

Superspacer, pl. # 45 holder # L46

FDTW-100, insert#21Chk.fixture

70 Deburr .005 to .010 both sides,

hand to hard stop Lathe E 162

Lathe.3 175 Collect CR # 179 1327 RPM

80 Broach keyway to remove thread burrs Drill M/c. 507Drill

.4 91 B87 fixture, L59 broach tap. .875120 G-H6

90 Hone thread I.D. .822/.828 Grind Grinder 1.5 120

95 Hone .7600/.7625 Grind Grinder 1.5 120

Basic work flow structures

If the flow is of low volume, go for manual process; and for high volume, go for automation.

The basic flow structures are:

1.Project layout (Fixed position layout, by virtue of its bulk or weight)

Example - Dam, Road, House, Film-location, Ship-building, Aircraft mfg.

2.Workcenter (where similar equipments are grouped for one kind of work)

groups of machines/equipments in a Job-shop/Functional/ Process/Group/ Batch

Layout; discrete product moves from one to another workcenter.

Example - Photocopy of a single student’s term paper; Bread-making.

3.Manufacturing cell (dedicated to products with similar processing needs).

A specific set of processes run in a cellular layout.

Example - Different units of a publication house.

Basic work flow structures Contd.

4. Assembly Line (a fixed line or sequence of progressive operations) discrete parts are made by moving from workstation to workstation in a line/ product layout. Example - Automobile manufacturing

5. Continuous process (like assembly line, but continuous and integrated operations) with limited/no predetermined stops.Example - Manufacturing of petroleum, steel, aluminum etc.

Product-Process

Matrix

Product-Process Matrix

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Operation strategy dictates the type of processes to be selected – the equipment, building, layout, technology, people, skill etc.

Major Factors Affecting Process Designs

Nature of product/service demand Scope for Expansion and Consolidation

Degree of vertical integration (of process) Make or Buy

Production flexibility Volume and Variety

Degree of automation Product/Service quality

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Types of Process Designs

Product-Focused Production Line or Assembly Line Job Shop or Intermittent Production As per the operations sequence to produce a product or

provide a service Discrete Units or Continuous Process

Process-Focused Organizing Processes by similarities or groups Products/Services (jobs) progress from department to

department as required

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Purchased

Components,Subassemblies

Product-Focused

2

31

4

7

6

5Components Subassembly

Assemblies

Product/Material Flow

Production OperationAsse

mblies

Raw Material Components

Components

Subassembly

Raw Material

Finished Goods

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Process-Focused

Job B

Custom Woodworking Shop

Cutting Assembly Sanding FinishingPlanning

Drilling

Shaping

Turning

15 7

3

2

1 6

36

4

2Job A

4 5

Product/Material Flow

Production Operation

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Process Reengineering

Drastically changing the process from the existing state

Truly reengineered processes are more efficient

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Deciding a Process from Alternatives

Batch Size and Product/Service Variety

Capital Requirements

Economic Analysis

Cost Functions of Alternative Processes

Break-Even Analysis

Financial Analysis

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Process Design Depends on Product Diversity and Batch Size

Smal

l

Bat

ch S

ize

Lar

ge

Few Number of Product Designs Many

ProductFocused,DedicatedSystems

ProductFocused,

BatchSystem

Process-Focused, Job Shop

CellularManufacturing

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Economic Analysis

Cost Functions of Processing Alternatives Fixed Costs

Annual cost when production volume is zero Initial cost of buildings, equipment, and other

fixed assets Variable Costs

Costs that vary with production volumes Labor, material, and variable overhead

Break-Even Analysis (to select a process/equipment based on cost-trade-offs)

• A standard approach to choose a process or equipment

• A model determines the break-even-point (BEP) of units produced (and sold) where onwards the process or equipment goes in profit

• The total revenue and total cost are equal at BEP.

Fixed cost

Loss

Variable cost

Sales R

even

ue

Profit

Margin of Safety

BEP

Rs.

Nos.

BEC

BEQ

Break-Even Analysis (Continued)

* This formula can be used to find any of its components algebraically if the other known parameters

Break-even Demand =

Purchase cost of process or equipment Price per unit - Cost per unit

Break-Even Analysis (Continued)

Example:

Suppose you want to purchase a new computer that will cost $5,000.

It will be used to process written orders from customers who will pay

$25 each for the service. The cost of labor, electricity and the form

used to place the order is $5 per customer. How many customers will

we need to serve to permit the total revenue to break-even with our

costs?

Answer: Break-even Demand:= Total fixed costs of process or equip.

Unit price to customer – Variable costs

= 5,000/(25-5)

= 250 customers

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Example: Economic Analysis at Valley Hospital

Valley Hospital is planning to install a new linen retrieval system. Two alternatives being considered are: a continuous vacuum (CV) system and a batch robotic/chute (BR/C) system. The following estimates were prepared:

CV BR/C Annual Fixed Costs ($000) $2,690 $975 Average Variable Cost per Ton $1,660 $2,590

At a forecast annual operating level of 2,000 tons of linen, which alternative should be chosen based only on total annual cost?

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Solution:

TCCV = 2,690,000 + 1,660(2,000) = $6,010,000 TCBR/C = 975,000 + 2,590(2,000) = $6,155,000

The continuous vacuum (CV) alternative has a lower total annual cost.The annual volume of linen has to increase or decrease to what level in order for the BR/C alternative to be favored?

TCCV = TCBR/C

2,690,000 + 1,660(Q) = 975,000 + 2,590(Q) 830Q = 1,715,000 Q = 1,844.1 tons

Annual volume must decrease to 1,844 tons or less.

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Economic Analysis

Break-Even Analysis Widely used to analyze and compare decision

alternatives Can be displayed either algebraically or graphically

Disadvantages: Cannot incorporate uncertainty Costs assumed over entire range of values Does not take into account time value of money

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Break-Even Analysis

Example Break-Even Points of Processes A, B, and C, assuming a $6.95 selling price per unit

Q = FC / (p-v)

A: Q = 120,000 / (6.95 - 3.00) = 30,380 unitsB: Q = 90,000 / (6.95 - 4.00) = 30,509 unitsC: Q = 80,000 / (6.95 - 4.50) = 32,654 units

Process A has the lowest break-even point.

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Economic Analysis

Financial Analysis Huge investment is done in production processes and

these assets are expected to last a long time Therefore, time value of money is important

Payback period Net present value Internal rate of return Profitability index

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Deciding Among Processing Alternatives

Assembly Charts (Gozinto Charts) Macro-view of how materials are united Starting point to understand factory layout needs,

equipment needs, training needs

Process Charts Details of how to build product at each process Includes materials needed, types of processes

product flows through, time it takes to process product through each step of flow

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Wrap-Up: World Class Practice

Fast new product introduction Design products for ease of production Refine forecasting Focus on core competencies ... less vertical

integration Lean production Flexible automation Job shops move toward cellular manufacturing Manage information flow ..... automate and simplify!

Question Bowl

What is the break-even in demand for a new process that costs $25,000 to install, will generate a service product that customers are willing to pay $500 per unit for, and whose labor and material costs for each unit is $100?

a. 400 units

b. 250 units

c. 100 units

d. 62.5 units

e. None of the above

Answer: d. 62.5 units i.e. 25,000/(500-100) = 62.5

Question Bowl

Which of the following is an example of a Continuous Flow type of process flow structure?

a. Fast foodb. Grocery c. Hospitalsd. Chemical companye. None of the above

Answer: d. Chemical company (in Process Industry)

So we need to study:• Hardware Systems• Software Systems• Evaluating a Robot Investment• Computer Integrated Manufacturing• Benefits & Risks

PROCESS TECHNOLOGIESRecent growth in productivity comes from the

application of Operations technology.

In manufacturing it comes from Soft (information) Technologies and Hard (machine) Technologies.

Hardware Systems

• Numerically controlled (NC) machines– Have Adaptive controls to receive/read instructions and

translate them into machine operations• CNC – computer numerically controlled• DNC – direct numerically controlled (several machines

controlled by a single computer)

• Industrial robots– Human-like machines performing production tasks, controlled

by a microcomputer, have grippers (vacuum, magnetized, adhesive), Equipped with an end effectors to pick, grip, hold) sensors (tactile, proximity, vision/optical); can operate in environments hostile to humans (heat, noise, dust, darkness, skin irritants, …)

– Perform precisely and repeatedly without fatigue– Weld, assemble, paint, inspect, transport, …..– Automated Inspection, Quality control, Material handling

• Automated material handling (AMH) systems– Computerized conveyors, AS/RS (load/pick/place), AGVS

• FMS – Manufacturing Cells, Robots, Machining Centers, ……...

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Flexible Manufacturing System (FMS)

Machine 1

Tools X

X

Machine 2

Tools X

X

Machine 3

Tools X

XComputer

Worker

X

X

X

X

X

X

X

UnloadLoad

PalletTransferSystem

Parts

Pallet withworkpieceattached

Workpiecein queue

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Group Technology/Cellular Manufacturing

Group Technology Each part produced receives a multi-digit code that

describes the physical characteristics of the part. Parts with similar characteristics are grouped into

part families Parts in a part family are typically made on the

same machines with similar tooling

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Group Technology/Cellular Manufacturing

Cellular Manufacturing Some part families (those requiring significant

batch sizes) can be assigned to manufacturing cells.

The organization of the shop floor into cells is referred to as cellular manufacturing.

Flow of parts within cells tend to be more like product-focused systems

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Group Technology/Cellular Manufacturing

Advantages (relative to a job shop) Process changeovers simplified Variability of tasks reduced (less training needed) More direct routes through the system Quality control is improved Production planning and control simpler Automation simpler

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Group Technology/Cellular Manufacturing

Disadvantages Duplication of equipment Under-utilization of facilities Processing of items that do not fit into a family

may be inefficient

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Group Technology/Cellular Manufacturing

Candidates for GT/CM are job shops having: A degree of parts standardization Moderate batch sizes

Software Systems

• Automated manufacturing planning and control systems (MP & CS)

• Enterprise Resource Planning (ERP)• Computer-aided-design (CAD)• Computer-aided engineering (CAE)• Computer-aided process planning (CAPP)• Computer-integrated manufacturing (CIM)

ProcessControls

MRP II

ASRS

CAD/CAM

AutomatedAssembly GT

Systems

Evaluating a Robot Investment

Where

P = Payback period in years

I = Total capital investment required in robot and accessories

L = Annual labor costs replaced by the robot (wage and

benefit costs per worker times the number of shifts per day)

E = Annual maintenance cost for the robot

Z = Annual depreciation

q = Fractional speedup (or slowdown) factor (in decimals).

Example: If robot produces 150 % of what the normal worker is

capable of doing, the fractional speedup factor is 1.5.

Z)q(LE-LP

IThe payback formula for an investment in robots is:

Example: Evaluating a Robot Investment

Suppose a company wants to buy a robot. The bank wants to know what the payback period is before they will lend them the $120,000 the robot will cost. You have determined that the robot will replace one worker per shift, for a one shift operation. The annual savings per worker is $35,000. The annual maintenance cost for the robot is estimated at $5,000, with an annual depreciation of $12,000. The estimated productivity of the robot over the typical worker is 110%. What is the payback period of this robot?

P = I = 120,000 = 1.47years L–E+q(L + Z) 35,000–5,000+1.1(35,000+12,000)

Computer Integrated Manufacturing (CIM)

• Product and process design– CAD and CAM

• Planning and control– CAPP and MP&CS

• The manufacturing process

Cost Reduction Benefits from Adopting New Technologies

• Labor costs• Material costs• Inventory costs• Transportation or distribution costs• Quality costs• Other costs

Other Benefits….

• Increased product variety

• Improved product features and quality

• Shorter cycle times

Risks

• Technological risks

• Organizational risks

• Environmental risks

• Market risks

References :

1. Operations & Supply Management; Chase, Shankar, Jacobs

and Aquilano; 12th Ed.; TMH Publication.

2. Operations Management; Gaither, N. and Frazier, G.;

Cengage Learning, 9th Edition.

End of Chapter