1. PRODUCT DESIGN & PROCESS SELECTION 1

2. PRODUCT DESIGN The process of defining all of the product characteristics Product design defines a product’s characteristics of:  Materials,  Appearance,  Dimensions,  Tolerances, And  Performance Standards. 2

3. PRODUCT DESIGN – PROCESS 1. Idea Development 2. Product Screening 3. Preliminary Design and Testing 4. Final Design 3

4. IDEA DEVELOPMENT Someone thinks of a need and a product/service design to satisfy it’s customers, competitors, etc., All products begin with an idea whether from: ◦ customers, ◦ competitors or ◦ suppliers Idea developments selection affects ◦ Product quality ◦ Product cost ◦ Customer satisfaction ◦ Overall manufacturability – the ease with which the product can be made 4

5. PRODUCT SCREENING Every business needs a formal/structured evaluation process: fit with facility and labor skills, size of market, contribution margin, break-even analysis, return on sales 5

6. DESIGN AND TESTING Technical specifications are developed, prototypes built, testing starts 6

7. FINAL DESIGN Final design based on test results, facility, equipment, material, & labor skills defined, suppliers identified 7

8. FACTORS INFLUENCING Requirements of customers. Availability and access to facilities. Type and quality of raw-materials Cost to price ratio. Quality standards. Availability of plant and machineries. Substitutes Reputation or goodwill of. 8

9. ISSUES LEGAL ISSUES PRODUCT LIABILITY Product liability is the area of law in which manufacturers, distributors, suppliers, retailers, and others who make products available to the public are held responsible for the injuries those products cause. INTELLECTUAL PROPERTY Intellectual property (IP) is a legal concept which refers to creations of the mind for which exclusive rights are recognized. 9

10. ETHICAL ISSUES Assessing the impact of Design on consumer Protection of Intellectual property Privacy Exposure to undesirable elements Advertising of designs Right to alter natural order Whether design should be tested on Animals and humans Sustainable Technology 10

11. ENVIRONMENTAL ISSUES Greenhouse effect for Global warming Ozone layer depletion Tropical Deforestation Water pollution Resource consumption 11

12. PRODUCT SCREENING - TOOL BREAK EVEN ANALYSIS 12 Computes the quantity of goods company needs to sell to cover its costs Q BE = F/ (SP - VC) Q BE – Break even quantity F – Fixed costs SP – selling price/unit VC– Variable cost

13. Break-Even Analysis: Graphical Approach 13

14. Break-Even Analysis Compute quantity of goods that must be sold to break-even Compute total revenue at an assumed selling price Compute fixed cost and variable cost for several quantities Plot the total revenue line and the total cost line Intersection is break-even Sensitivity analysis can be done to examine changes in all of the assumptions made 14

15. PROCESS Process is the Set of activities that taken together to produce a result of value to the customer. PROCESS PLANNING – STEPS: 1. GOAL SETTING: 2. DEVELOPING THE PLANNING PREMISES: 3. REVIEWING LIMITATIONS: 4. DECIDING THE PLANNING PERIOD: 5. FORMULATION OF POLICIES AND STRATEGIES: 6. PREPARING OPERATING PLANS: 7. INTEGRATION OF PLANS: 15

16. PROCESS SELECTION The development of the process necessary to produce the designed product. 16

17. PROCESS SELECTION INTERMITTENT PROCESSES: Processes used to produce a variety of products with different processing requirements in lower volumes. (such as healthcare facility) REPETITIVE PROCESSES: Processes used to produce one or a few standardized products in high volume. (such as a cafeteria, or car wash) 17

18. Product-Process Grid 18

19. PROCESS SELECTION - CONSIDERATIONS 1. Product-Process Grid 2. Make or Buy 3. Flexibility of resources 4. Mix between capital & human resources 5. Degree of customer contact 6. Integration 19

20. Other Factors Make or Buy- A firm’s Make-or-Buy choices should be based on the following considerations: ◦ Strategic impact ◦ Available capacity ◦ Expertise ◦ Quality considerations ◦ Speed ◦ Cost Vertical integration refers to the degree a firm chooses to do processes itself- raw material to sales. Backward Integration means moving closer to primary operations. Forward Integration means moving closer to customers

21. Product Life Cycle Series of changing product demand Consider product life cycle stages ◦ Introduction ◦ Growth ◦ Maturity ◦ Decline Facility & process investment depends on life cycle 21

22. Tasks or operations Examples: Giving an admission ticket to a customer, installing a engine in a car, etc. Decision Points Examples: How much change should be given to a customer, which wrench should be used, etc. PROCESS DESIGN- FLOWCHART SYMBOLS

23. Examples: Sheds, lines of people waiting for a service, etc. Examples: Customers moving to a seat, mechanic getting a tool, etc. Storage areas or queues Flows of materials or customers

24. Linking Product Design & Process Selection Product design and process selection are directly linked Type of product selected defines type of operation required Type of operation available defines broader organizational aspects such as ◦ Equipment required ◦ Facility arrangement ◦ Organizational structure 24

25. Linking Product Design & Process Selection con’t Impact of Product Life Cycle: Intermittent and repetitive operations typically focus on producing products in different stages of the product life cycle. Intermittent is best for early in product life; repetitive is better for later when demand is more predicable. 25

26. Linking Product Design & Process Selection, con’t Impact of Competitive Priorities: Intermittent operations are typically less competitive on cost than repetitive operations. (Think “off the rack” vs. custom tailored clothing.) 26

27. Linking Design & Process Selection: Summary Organizational Decisions appropriate for different types of operations 27

28. Process Performance Metrics 28

29. Process Performance Metrics Process performance metrics – defined: Measurement of different process characteristics that tell us how a process is performing ◦ Determining if a process is functioning properly is required ◦ Determination requires measuring performance 29

30. Metrics Example: At Zelle’s Dry Cleaning, it takes an average of 3 ½ hours to dry clean & press a shirt, with value-added time estimated at 110 min. Workers are paid for a 7-hour workday but work 5 ½ hr/day, accounting for breaks and lunch. Zelle’s completes 25 shirts per day, while the industry standard is 28 for a comparable facility.

31. Solution 31 Process Velocity = (Throughput Time)/(Value-added time) = (210 minutes/shirt)/(110 minutes/shirt) = 1.90 Labor Utilization = (Time in Use)/(Time Available) = (5 ½ hr)/(7 hr) =.786 or 78.6% Efficiency = (Actual Output)/(Standard Output) = (25 shirts/day)/(28 shirts/day) =.89 or 89%

32. Design of Services Service design is unique in that the service and entire service concept are being designed ◦ must define both the service and concept - Physical elements, aesthetic & psychological benefits e.g. promptness, friendliness, ambiance ◦ Product and service design must match the needs and preferences of the targeted customer group 32

33. Designing Services vs Products? Services are different from manufacturing as they; ◦ Produce intangible products ◦ Involve a high degree of customer contact Type of service is classified according to degree of customer contact 33

34. Service Design Matrix Service Characteristics ◦ Pure services ◦ Quasi-Manufacturing ◦ Mixed services Service Package ◦ The physical goods ◦ The sensual benefits ◦ The psychological benefits Differing designs ◦ Substitute technology for people ◦ Get customer involved ◦ High customer attention 34

35. WORK STUDY Work Study is a systematic examination of the methods or activities carried out during transformation of inputs into outputs.

36. Objectives Analyze existing process Optimum utilization of men and material resources Set standards for production Improve productivity develop effective work methods Increase work values Bring in Ergonomics Plan incentives Implement safety measures 36

37. Applications Work Study Helps In Building Better Transportation Models, Better Process, Better Supply Chain Systems, Integrate Other Functions, Implement New Technologies, Better Working Environment, Etc., 37

38. Techniques WORK STUDY WORK MEASUREMENT TIME STUDY MOTION STUDY METHOD STUDY 38

39. Method Study Method Study deals with the different tasks and techniques used to perform an activity hat convert input into outputs. 39

40. Objectives Analyze existing process Optimum utilization of men and material resources Set standards for production Improve productivity develop effective work methods Derive new methods Increase work values Bring in Ergonomics Plan incentives Implement safety measures 40

41. Method Study - Procedure Select the work to be studied Record all relevant information's Analyze the recorded facts – Purpose, time, person, means etc., Develop new methods oto perform the tasks Install and equip people resources Control and Maintain 41

42. WORK MEASUREMENT A systematic determination through the use of various techniques to analyze the effectiveness of physical and mental work in terms of work time in a specific task. WORK MEASUREMENT studies the time taken for an established employee to carry out a work task, It assists in calculating the total cost of a good manufactured 42

43. Objectives Determine time required to perform a job Determine the man power required to perform a job Determine the materials and equipments required to perform a job Determine actual inventory Estimate actual lead time Plan labour incentives Establish effective labour control Establish standards of performance 43

44. Elements of Work Measurement Time Study Work Sampling Motion Study 44

45. Time Study A technique for recording the time of working activities of a specialized work carried out under specified conditions and determining the time required for carrying out the work at desired level of performance 45

46. Time Study - Procedure Define the purpose ofm study Study the excising methods, processes, etc., Study the time involved Record the information Observe the actual time Estimate normal and standard time Determine allowances Norma time = Basic Time * Performance Rating Standard Time= Norma Time + Allowances 46

47. Elements Basic Time – Actual or observe time to perform one element of an activity Performance Rating – Actual performance of an operator at different periods of time Allowances – Additional time provided for delays at the work place Standard Time – Total time taken to completing the activity of a work 47

48. Work Sampling Work Sampling is a method of finding time of delay and work element to the total process by random observations. A technique in which a large number of observations are made over a period of time with a group of machines, processes or workers. Each observation records what is happening at that instant and the percentage of observations recorded for a particular activity or delays is the measure of percentage of time during which that activity of delay occurs 48

49. Motion Study Deals with the quantity of physical movement of human, material and machine assets within th e manufacturing plant 49

50. Productivity Productivity is a economic measure of output per unit of input. Inputs includes men, money, machine, energy and materials while output is typically measured in terms of revenues and other components. 50

51. Factors Influencing Human Technological Managerial Psychological Political Economical Natural 51

52. How to calculate Productivity Productivity = Total Output / Total Input Labour Productivity = Total Output / Total Input in Labour Hrs Capital Productivity = Total Output / Total Capital Input Material Productivity = Total Output / Total Material Input Energy Productivity = Total Output / Total energy input 52