CHAPTER 3
PRODUCT AND SERVICE DESIGN
PROCESS SELECTION
CAPACITY PLANNING
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Process Selection and System Design
6-2
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Process Strategy
• Key aspects of process strategy
6-3
–
Capital intensive – equipment/labor
–
Process flexibility
–
The objective is to create a process that can
produce offerings that meet customer
requirements within cost and other
managerial constraints.
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Process Types
• Job shop
– Small scale
• Batch
– Moderate volume
• Repetitive/assembly line
– High volumes of standardized goods or
services
• Continuous
– Very high volumes of non-discrete goods
6-5
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Job shop
(Stevenson, 2018)
6-6
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Batch processing
(Stevenson, 2018)
6-7
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Repetitive processing
(Stevenson, 2018)
6-8
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Continuous processing
(Stevenson, 2018)
6-9
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Compare the four basic processing types
(Stevenson, 2018)
6-10
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Product or Service and Flexibility
Variety and Equipment Flexibility
6-11
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Process choice affects numerous activities/functions
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Product and Process Profiling
• Process selection can involve substantial investment in
– Equipment
– Layout of facilities
• Product profiling: Linking key product or service
requirements to process capabilities
• Key dimensions
–
–
–
–
–
6-13
Range of products or services
Expected order sizes
Pricing strategies
Expected schedule changes
Order winning requirements
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Technology
• Technology: The application of scientific discoveries to
the development and improvement of products and
services and operations processes.
• Technology innovation: The discovery and development
of new or improved products, services, or processes for
producing or providing them.
6-14
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Technology Competitive Advantage
• Innovations in
– Products and services
• Cell phones
• PDAs
• Wireless computing
– Processing technology
• Increasing productivity
• Increasing quality
• Lowering costs
6-15
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Kinds of Technology
• Operations management is primarily
concerned with three kinds of technology:
– Product and service technology
– Process technology
– Information technology
• All three have a major impact on:
– Costs
– Productivity
– Competitiveness
6-16
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Technology Acquisition
• Technology can have benefits but …
• Technology risks include:
– What technology will and will not do
– Technical issues
– Economic issues
•
•
•
•
6-17
Initial costs, space, cash flow, maintenance
Consultants and/or skilled employees
Integration cost, time resources
Training, safety, job loss
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Automation
• Automation: Machinery that has sensing
and control devices that enables it to
operate
– Fixed automation
– Programmable automation
– Ex. Foxconn shifts its focus to automation
(pp.252)
6-18
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Automation
• Computer-aided design and
manufacturing systems (CAD/CAM)
• Numerically controlled (NC) machines
• Robot
• Manufacturing cell
• Flexible manufacturing systems(FMS)
• Computer-integrated manufacturing (CIM)
6-19
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(Stevenson, 2018)
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Facilities Layout
• Layout: the configuration of departments, work
centers, and equipment, with particular emphasis
on movement of work (customers or materials)
through the system
• Product layouts
• Process layouts
• Fixed-Position layout
• Combination layouts
6-21
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Objective of Layout Design
1. Facilitate attainment of product or service quality
2. Use workers and space efficiently
3. Avoid bottlenecks
4. Minimize unnecessary material handling costs
5. Eliminate unnecessary movement of workers or
materials
6. Minimize production time or customer service time
7. Design for safety
6-22
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Importance of Layout Decisions
• Requires substantial investments of money and
effort
• Involves long-term commitments
• Has significant impact on cost and efficiency of
short-term operations
6-23
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The Need for Layout Decisions
Inefficient operations
For Example:
High Cost
Bottlenecks
Changes in the design
of products or services
Accidents
The introduction of new
products or services
Safety hazards
6-24
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The Need for Layout Design (Cont’d)
Changes in
environmental
or other legal
requirements
Changes in volume of
output or mix of
products
Morale problems
Changes in methods
and equipment
6-25
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Basic Layout Types
• Product layouts
• Process layouts
• Fixed-Position layout
• Combination layouts
6-26
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Basic Layout Types
• Product layout
–
Layout that uses standardized processing operations
to achieve smooth, rapid, high-volume flow
• Process layout
–
Layout that can handle varied processing
requirements
• Fixed Position layout
–
6-27
Layout in which the product or project remains
stationary, and workers, materials, and equipment are
moved as needed
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Repetitive Processing: Product Layouts
A flow line for production or service
(Sequential)
Used for Repetitive Processing Repetitive and Continuous Processes
(Stevenson, 2018)
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Repetitive Processing: Product Layouts
Cafeteria line
(Stevenson, 2018)
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Advantages of Product Layouts
•
•
•
•
•
•
•
6-30
High rate of output
Low unit cost
Labor specialization
Low material handling cost
High utilization of labor and equipment
Established routing and scheduling
Routing accounting and purchasing
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Disadvantages of Product Layouts
• Creates dull, repetitive jobs
• Poorly skilled workers may not maintain
equipment or quality of output
• Fairly inflexible to changes in volume
• Highly susceptible to shutdowns
• Needs preventive maintenance
• Individual incentive plans are
impractical
6-31
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A U-Shaped Production Line
(Stevenson, 2018)
6-32
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Nonrepetitive Processing: Process Layouts
6-33
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Advantages of Process Layouts
• Can handle a variety of processing requirements
• Not particularly vulnerable to equipment failures
• Equipment used is less costly
• Possible to use individual incentive plans
6-34
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Disadvantages of Process Layouts
•
•
•
•
•
•
•
6-35
In-process inventory costs can be high
Challenging routing and scheduling
Equipment utilization rates are low
Material handling slow and inefficient
Complexities often reduce span of supervision
Special attention for each product or customer
Accounting and purchasing are more involved
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Fixed Position Layouts
• Fixed Position Layout: Layout in which the product
or project remains stationary, and workers,
materials, and equipment are moved as needed.
• Nature of the product dictates this type of layout
– Weight
– Size
– Bulk
• Large construction projects
6-36
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(Stevenson, 2018)
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Cellular Layouts
• Cellular Production
–
Layout in which machines are grouped into a cell that
can process items that have similar processing
requirements
• Group Technology
–
6-38
The grouping into part families of items with similar
design or manufacturing characteristics
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Functional vs. Cellular Layouts
Dimension
Functional
Cellular
Number of moves
between departments
many
few
Travel distances
longer
shorter
Travel paths
variable
fixed
Job waiting times
greater
shorter
Throughput time
higher
lower
Amount of work in
process
higher
lower
Supervision difficulty
higher
lower
Scheduling complexity
higher
lower
Equipment utilization
lower
higher
6-40
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Service Layouts
•
•
•
•
6-41
Warehouse and storage layouts
Retail layouts
Office layouts
Service layouts must be aesthetically
pleasing as well as functional
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Design Product Layouts: Line Balancing
Line Balancing is the process of assigning
tasks to workstations in such a way that
the workstations have approximately
equal time requirements.
6-42
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Cycle Time
Cycle time is the maximum time
allowed at each workstation to
complete its set of tasks on a unit.
6-43
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Precedence Diagram
Precedence diagram: Tool used in line balancing to
display elemental tasks and sequence requirements
Figure A
0.1 min.
1.0 min.
a
b
c
0.7 min.
6-44
d
0.5 min.
A Simple Precedence
Diagram
e
0.2 min.
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Example 1: Assembly Line Balancing
• Arrange tasks shown in Figure A into three
workstations.
–
–
6-45
Use a cycle time of 1.0 minute
Assign tasks in order of the most number of followers
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Determine Maximum Output
OT
Output rate =
CT
OT = operating time per day
D = Desired output rate
6-46
OT
CT = cycle time =
D
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Determine the Minimum Number
of Workstations Required
N=
( å t)
CT
å t = sum of task time
6-47
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A simple precedence diagram
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Line Balancing Rules
Some Heuristic (intuitive) Rules:
• Assign tasks in order of most following tasks.
–Count the number of tasks that follow
• Assign tasks in order of greatest positional weight.
– Positional
weight is the sum of each task’s time and the
times of all following tasks.
6-49
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Example 1 Solution
Revised
Time
Remaining
Eligible
Assign
Task
1.0
0.9
0.2
a, c
c
none
a
c
-
0.9
0.2
2
1.0
b
b
0.0
3
1.0
0.5
0.3
d
e
-
d
e
-
0.5
0.3
Workstation
1
Time
Remaining
Station
Idle Time
0.2
0.0
0.3
0.5
6-50
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Example 1 Solution
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Calculate Percent Idle Time
Idle time per cycle
Percent idle time =
(N)(CT)
Efficiency = 1 – Percent idle time
6-52
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Bottleneck Workstation
30/hr.
1 min.
30/hr.
1 min.
30/hr.
2 min.
1 min.
30/hr.
Bottleneck
6-54
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Parallel Workstations
30/hr.
1 min.
60/hr.
2 min.
30/hr.
1 min.
1 min.
60/hr.
30/hr.
2 min.
30/hr.
Parallel Workstations
6-55
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Designing Process Layouts
Information Requirements:
1. List of departments
2. Projection of work flows
3. Distance between locations
4. Amount of money to be invested
5. List of special considerations
6. Location of key utilities
6-56
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Example 3: Interdepartmental Work
Flows for Assigned Departments
6-57
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6-58
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Solution
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