Chapter 6: pp 209 to 225; [Chapter 7: Service]

Process Planning AndTechnology Decisions for Manufacturing Operations

Process Strategy

Overall approach to producing goods & services

Defines:capital intensity

process flexibility

vertical integration

customer involvement

Types of Processes

Projects Job Shop Batch production - relatively stable demand

e.g. heavy equipment, specialty chemicals. Mass production or Assembly line Continuous production (flow)

Project Batch (Job shop) Mass Continuous

Product Unique Made to order Made to stock Commodity

Customer Singly Few individuals Mass market Mass market

Demand Infrequent Fluctuates Stable Very stable

Volume Very low Low to med High Very high

Variety Infinite Many, high Low Very low

System Long-term Intermittent Flow lines Process industry

Equipment Varied General-purp. Special-purp. Highly automated

Type of work Contracts Fabrication Assembly Mix, treat, refine

Skills Experts Wide range Limited range Equipment

craftspeople monitors

Advantages Custom work Flexibility Efficiency Highly efficient

quality sped, low cost large capacity

Disadv. Non-repeating Costly, slow Capital invest. Difficult to change

Example Construction Printing, bakery Autos, TV’s Paint, oil, food

IV.Continuous

Flow

III.Assembly

Line

II.Batch

I.Job

Shop

LowVolumeOne of a

Kind

MultipleProducts,

LowVolume

FewMajor

Products,HigherVolume

HighVolume,

HighStandard-

ization

CommercialPrinter

French Restaurant

HeavyEquipment

Coffee Shop

AutomobileAssembly

Burger King

SugarRefinery

Flexibility (High)Unit Cost (High)

Flexibility (Low)Unit Cost (Low)

Source: Modified from Robert Hayes and Steven Wheelwright, Restoring Our Competitive Edge: Competing through Manufacturing (New York: John Wiley & Sons, 1984). p. 209.

Exhibit 6.2Exhibit 6.2

13

Product StructureProduct Life Cycle Stage

Not feasible

Not feasible

Process Planning

Make-or-buy decisions Process selection Specific equipment selection Process plans Process analysis

Process Planning: Process Selection With

Break-Even Analysis

Total cost = total fixed cost + total variable costTC = cf vcv

Total revenue = volume x priceTR =vp

Total profit = total revenue - total costZ = TR- TC

= vp - (cf vcv)cf = fixed costv = volumecv = variable cost per unitp =price per unit

Solving For Break-Even Volume

TR TC

vp vc

vp vc

v p c

vp c

v

v

v

v

( )

( )

c

c

c

c

f

f

f

f

Break-Even Example

v cf

p cv

200010 5

400 rafts

Fixed cost = cf =$2,000Variable cost = cv = $5 per raftPrice = $10 per raft

Break-Even Graph

$0

$1,000

$2,000

$3,000

$4,000

$5,000

400

Units

Dollars

Choosing Between Two Processes

$3v = $8,000

v = 2,667 rafts

$2,000 + $5v = $10,000 + $2v

Process A Process B

Below 2,667 choose AAbove 2,667 choose B

Graphical Solution To Process Selection

$0

$5,000

$10,000

$15,000

$20,000

$25,000

0 1000 2000 3000 4000

Units

Do

llars

A B

A

B

Point Of Indifference

Volume where cost of A = cost of B Rule for choosing process:

Above point of indifference choose process with lowest variable cost

Below point of indifference choose process with lowest fixed cost

Process Planning: Make-Or-Buy Decisions

1. Cost

2. Capacity

3. Quality

4. Speed

5. Reliability

6. Expertise

Process Planning: Specific Equipment Selection

1. Purchase cost

2. Operating cost

3. Annual savings

4. Revenue enhancement

5. Replacement analysis

6. Risk and uncertainty

7. Piecemeal analysis

Process Planning: Process Plans - documents used

Engineering drawings (Blueprints) Bill of material Assembly diagram Assembly chart / product structure diagram Operations process chart Routing sheet

Bill Of Material(unstructured)

No.Part No. Part name

1 51292 Outlet end

2 51284 Handle

3 52043 Switch

4 51576 Electric cord

5 51265 Rear housing

6 51268 Motor mounting plate

Product Structure Diagram

Upholstery tool

Crevice tool Hand-vac

Dusting tool Package

Packaged Hand-vac

Forward housing

assembly

Screw & lock washer

assembly

Rear housing

assembly

Operations Process Chart

Part name Table leg

Part no. 2410

Usage Table

Assembly No. 437

Oper No. Description Dept. Machine Time Tools

10 Saw to rough length 041

20 Plane to size 043

30 Saw to finished length 041

40 Measure dimensions 051

50 Sand 052

Process Flowchart Symbols

Operations

Inspection

Transportation

Delay

Storage

D

Process Flowchart

Ste

p

Ope

ratio

nT

rans

port

Insp

ect

Del

ayS

tora

ge

Dis

tanc

e(f

eet)

Tim

e(m

in)Description

ofprocess

1

2

3

4

5

6

7

8

9

10

11

Unload apples from truck

Move to inspection station

Weigh, inspect, sort

Move to storage

Wait until needed

Move to peeler

Apples peeled and cored

Soak in water until needed

Place in conveyor

Move to mixing area

Weigh, inspect, sort

TotalPage 1 0f 3 480

30

5

20

15

360

30

20

190 ft

20 ft

20 ft

50 ft

100 ft

Date: 9-30-95

Analyst: TLR

Location: Graves Mountain

Process: Apple Sauce

Process Planning: Process Analysis

Continuous improvementbasic tool is process flowchart

Reengineeringbasic tool is process map

Process ReengineeringCustomer

requirements data

Strategic directive

Goals & specifications for process performance

High-level process map

Detailed process map

Pilot study of new design

Full-scale implementation

Benchmark data

Design principles

Key performance

measures

Baseline analysis

Innovative ideas

Model validation

High-level Process Map

Input OutputPerformance

Goal

Subprocess Subprocess

Subprocess Subprocess

Design Principles For Reengineering

1. Organize around outcomes, not tasks

2. Capture information once, at the source

3. Centralize resources with info. tech.

4. Link parallel sub-processes

5. Design to do work right the first time

6. Remove complexity

7. Identify information & technology levers

Information Technology in Manufacturing Processes

Management information system (MIS)move large amounts of data

Decision support system (DSS)add decision making support

Expert systemrecommend decision based on expert knowledge

Decision Support System

Information:reportsmodel resultswhat if? analysis

Computersystem:dataprocessing

Data

Quantitativetechniques

Personnel

Accounting

Production

Marketing

Distribution

Other areas

Decisions

Management Information System

What -if? analysis

ManagementDecision Support System

Artificial Intelligence

Neural networksemulate interconnections in brain

Genetic algorithmsbased on adaptive capabilities in nature

Fuzzy logicsimulate human ability to deal with ambiguity

Advanced Communications

Electronic data interchange (EDI) Internet Wireless communications Teleconferencing & telecommuting Bar coding

–Being replaced by Radio Frequency Identification (RFID)

Virtual reality

Manufacturing Technology

Numerically controlled (NC) machinescontrolled by punched tape

Computer numerical controlled (CNC)controlled by attached computer

Direct numerical control (DNC)several NC machines controlled by single

computer

Automated Material Handling

Conveyors Automated guided vehicle (AGV) Automated storage & retrieval system

(ASRS)

Flexible Manufacturing Systems (FMS)

Programmable machines Controlled by common computer network Combines flexibility with efficiency Reduces setup & queue times

Flexible Manufacturing System

PartsFinishedgoods

Load Unload

Computercontrolroom

Terminal

Machine Machine

Tools

Conveyor

Pallet

Robotics

Programmable manipulators Follow specified path Better than humans with respect to

hostile environments

long hours

consistency

Robot Parts

Controllerhardware, software, power source

Manipulatorrobot arm

End-effector“hand”

Computer Integrated Manufacturing (CIM)

Integration of design, manufacture & delivery via computer technology

CAD - uses software to create & modify designs

CAM - uses programmable automation in manufacturing CAE - links functional design to CAD form design CAPP - creates processing instructions for CAM

GT- classifies designs to benefit from prior experience

Components Of CIM

CIM

Productdesign

Manufacture

Processplanning

Systemsmanagement

RoboticsFMSNC/CNC/

DNCCells

and centersAutomatedinspection

AGV,ASRS

JIT/kanban

DSS/ES/AI

LAN, TOP,satellites

TQM

Bar codes,EDI

MRP

GTCAECADIGES,PDES,DMIS

DFM

Cellularmanufacturing

MAP,STEP

CAD/CAM

CAPP

Adoption Of Technology

Technology Readiness Need well-designed products & efficient processes

Technology Design Know what to automate

Technology Selection Choose the right level

Technology Integration Have a strategy for incremental automation

Reminder: Process Analysis Measurement

Review process performance metrics -- see Chase: pages 162 to 165 1. Operation time = setup time + run time

2. Throughput time = average time for a unit to move through the system

3. Throughput Rate = 1/cycle time

4. Efficiency = actual output/standard output

5. Utilization = time activated/time available