Process Design in Operations Management: Strategies, Analysis, and Technology, Study Guides, Projects, Research of Business Management and Analysis

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Chapter 7 – Process

Design

Operations Management

Alice Husadawati 212015505

Process Strategies

Process Strategy – An organization’s approach to

transforming resources into goods and services

Four Process Strategies  (^) Process focus  (^) Repetitive focus  (^) Product focus  (^) Mass customization

Process Focus

A production facility organized around process to facilitate low-volume, high-variety production,

Process Focus

• Advantages:

– Greater product flexibility.

– More general purpose equipment.

– Lower initial capital investment.

• Disadvantages:

– High variable cost per unit.

– More highly trained personnel.

– More difficult production planning &

control.

– Low equipment utilization (5% to 25%).

Repetitive Focus

Facilities often organized by assembly lines. Characterized by modules.

 Parts & assemblies made previously.

Modules combined for many output options. Other names:

 Assembly line.

 Production line.

Raw materials and module inputs Modules combined for many output options Automobile Assembly Line

Few inputs Output variations in size, shape, and packaging Continuous Work Flow

Mass Customization Focus  (^) The rapid, low-cost production of goods and service to satisfy increasingly unique customer desires  (^) Combines the flexibility of a process focus with the efficiency of a product focus

PROCESS COMPARISON Process Focus (Low volume, high variety) Repetitive Focus (Modular) Product Focus (High- volume, low- variety) Mass Customiza tion (High- volume, high- variety) Small quantity, large variety of products Long runs, standardize d product made from modules Large quantity, small variety of products Large quantity, large variety of products Broadly skilled operators Moderately trained employees Less broadly skilled operators Flexible operators Table 7.

Process Focus (Low volume, high variety) Repetitive Focus (Modular) Product Focus (High- volume, low- variety) Mass Customizat ion (High- volume, high- variety) Many job instructions as each job changes Repetition reduces training and changes in job instructions Few work orders and job instructions because jobs standardize d Custom orders require many job High instructions Inventory Low Inventory Low Inventory Low Inventory relative to the value of the product

CROSSOVER CHARTS Crossover Charts Fixed costs Variable costs $ High volume, low variety Process C Fixed costs Variable costs $ Repetitive Process B Fixed costs Variable $^ costs Low volume, high variety Process A Fixed cost Process A Fixed cost Process B Fixed cost Process C Total cost Total cost Total cost (2,857) (^) V 1 V 2 (6,666) 400, 300, 200, Volume $ Figure 7.

FOCUSED PROCESSES  (^) Focus brings efficiency by building a core competence on  (^) Customers  (^) Products  (^) Service  (^) Technology

Process Analysis and Design Tools to Use in Process Analysis and Design

1. Flowchart – A drawing used to analyze movement of people or material
2. Time Function Mapping – A flowchart with time added on the horizontal axis

“Baseline” Time Function Mapping Customer Sales Production control Plant A Warehouse Plant B Transport Move Receive product Extrude Wait Move Wait Print Wait Order product Process order Wait 12 days 13 days 1 day 4 days 1 day 10 days 1 day 0 day 1 day 52 days Figure 7.