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Chapter 6 Process Selection and Facility Layout

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1 Chapter 6 Process Selection and Facility Layout
Saba Bahouth – UCO

2 Process Selection as Part of System Design
Deciding on the way the production of goods or services will be organized Forecasting Product and Service Design Technological Change Capacity Planning Process Selection Facilities and Equipment Facility Layout Work Design Saba Bahouth – UCO

3 Process Choice Decisions
Three Types of Goods and Services Custom, or make-to-order, goods and services are generally produced and delivered as one-of-a-kind or in small quantities, and are designed to meet specific customers’ specifications. Examples: ships, weddings, certain jewelry, estate plans, buildings, and surgery. Option, or assemble-to-order, goods and services are configurations of standard parts, subassemblies, or services that can be selected by customers from a limited set. Examples: desktop computers, Subway sandwiches, vacation in tour, BBA Standard, or make-to-stock, goods and services are made according to a fixed design, and the customer has no options from which to choose. Examples: appliances, shoes, sporting goods, credit cards, on-line Web-based courses, and bus service. Saba Bahouth – UCO

4 The Big Picture Types of Goods and Services Types of Processes
Custom make-to-order Option assemble-to-order Standard make-to-stock Types of Processes 1. Projects 2. Job-Shop 3. Batch 4. Repetitive/ (Assembly Lines) 5. Continuous Types of Layout 1. Fixed Position Layout 2. Process/Functional Layout 3. Product Layout 4. Combination Layout Saba Bahouth – UCO

5 Types of Processes Projects Job shop: Small scale production
Batch: Moderate volume production Repetitive/assembly line: High volumes of standardized goods or services Continuous: Very high volumes of non-discrete goods Job-Shop (intermittent process) Process/Functional Layout Repetitive (assembly line) Product Layout Continuum Make to Order High variety, low volume Low utilization (5% - 25%) General-purpose equipment Make to Stock Low variety, high volume High utilization (70% - 95%) Specialized equipment Batch Continuous Flexible equipment Saba Bahouth – UCO

6 You can use this slide to introduce a discussion of process-focused strategy. Examples are suggested in the following slide or may be requested of students. Saba Bahouth – UCO

7 Batch Repetitive Saba Bahouth – UCO

8 Volume, Variety and Process Matrix
Low-Volume Repetitive Process High-Volume Different Products: (High Variety) One or few units per run, high variety (allows customization) Process/Functional focus (Intermittent) projects, job shop (machine, print, carpentry) Kinko’s Mass Customization (difficult to achieve, but huge rewards) Dell Computer Co. Different Modules Modest runs, standardized modules (Batch) Repetitive (autos, motorcycles) Honda It may be most useful to begin discussion of this slide with the repetitive process since most students seem to have a concept of an assembly line. Once the repetitive process is introduced, one can then view changing one of the parameters, volume or length of run, and argue the need for process- or product-focus systems. Once the three types of processes have been introduced, it is probably useful to discuss precisely why the low-volume/long run, and high-volume/short run options are usually poor choices. Poor strategy Product focus (steel, glass) Nucor Steel Different Attributes only (Low Variety) (such as grade, quality, size, thickness, etc.) Long runs only Saba Bahouth – UCO

9 Assembly-Line Balancing
0.1 min 0.7 min 1.0 min 0.5 min 0.2 min Saba Bahouth – UCO

10 Assembly-Line Balancing
An assembly line is a product layout dedicated to combining the components of a good or service that has been created previously. Assembly line balancing is a technique for grouping tasks to balance the workload on workstations. Cycle time (CT) is the interval between successive outputs. Min. number of WS needed = Sum of task times/Cycle time =  t / CT Individual WS efficiency = t / CT Assembly Line Efficiency =  t / (N*CT) 0.1 min 0.7 min 1.0 min 0.5 min 0.2 min Saba Bahouth – UCO

11 Assembly-Line Balancing
5 workstations: CT = 1 minute; 1 assembly every 1 minute. 3 workstations: CT = 1 minute; 1 assembly every 1 minute. 1 workstation: CT = 2.5 minutes; 1 assembly every 2.5 minutes. Maximum Allowed Cycle Time: MACT = A / R where A = Available time to produce the output (Hrs/day or Min/day) R = Required output Rate (units/day) (be careful with time units) Example: [8hrs/day] / [160units/day] = 0.05 hrs/unit or 3 minutes 0.1 min 0.7 min 1.0 min 0.5 min 0.2 min Saba Bahouth – UCO

12 Funnel Analogy of Bottlenecks
Saba Bahouth – UCO

13 Little’s Law J.D. Little (1961) developed a simple formula that explains the relationship between flow time (T), throughput (R) and work-in-process (WIP), which is known as Little’s Law. WORK-IN-PROCESS (WIP) = THROUGHPUT (R) * FLOW TIME (T) Assume: Throughput = 30 units/hr Flow time = 20 minutes or 1/3 hr Therefore WIP = 30 units/hr x 1/3 hr = 10 units Consider a voting facility that processes an average of 50 people per hour and that on average, it takes 10 minutes for each person to complete the voting process. WIP = R*T WIP = 50 voters/hr*(10 minutes/60 minutes per hour) WIP = 8.33 voters Saba Bahouth – UCO

14 Solved Problem An accounts receivable manager processes 200 bills per day with an average processing time of 5 working days. What is the average number of bills in her office? What if she reduces the time from 5 to 1 day using better technology? Solution: Saba Bahouth – UCO

15 Automation Automation: Machinery that has sensing and control devices that enables it to operate with minimal input from an operator. Fixed automation Programmable automation Machine technology – NCM for drilling, cutting, etc Automatic identification systems (AIS) – Bar codes, toll pass Process control – Glass temperature – QA charts Vision system - Replacing human inspection: level in medicine bottles Robot – Imitation of human arm for boring and dangerous jobs Automated storage and retrieval systems (ASRS) Automated Guided Vehicles (AGV) Flexible manufacturing systems (FMS) – One computer system controlling several machines and material handling Computer-integrated manufacturing (CIM) – One computer system spanning over engineering, inventory, manufacturing, warehousing and shipping Saba Bahouth – UCO

16 Facilities Layout Layout: the configuration of departments, work centers, and equipment, with particular emphasis on movement of work (customers or materials) through the system Process/Functional layout Product layout Combination layout Fixed-Position layout (Projects) Saba Bahouth – UCO

17 Process/Functional Layout
Gear cutting Mill Drill Lathes Grind Heat treat Assembly 111 333 222 444 1111 2222 3333 44444 333333 22222 Saba Bahouth – UCO

18 Process/Functional Layout
A process/functional layout consists of a functional grouping of equipment or activities that do similar work. Examples: offices, hospitals. Advantages of product layouts include a lower investment in general purpose equipment, flexibility, and the diversity of jobs inherent in a process layout can lead to increased worker satisfaction. Saba Bahouth – UCO

19 Product Layout A product layout is an arrangement based on the sequence of operations that are performed during the manufacturing or service. Examples: Subway sandwich shops, automobile assembly lines. Advantages of product layouts include lower work-in-process inventories, shorter processing times, less material handling, requires lower labor skills, and simple planning and control systems. Saba Bahouth – UCO

20 Process/Functional Layout
Gear cutting Mill Drill Lathes Grind Heat treat Assembly 111 333 222 444 1111 2222 3333 44444 333333 22222 Cellular Production Group Technology Saba Bahouth – UCO

21 Cellular Manufacturing Layout
-1111 - 2222 Assembly - 3333 - 4444 Lathe Mill Drill Heat treat Gear cut Grind Saba Bahouth – UCO

22 Group Technology / Cellular Layout
Saba Bahouth – UCO

23 Forming a Cell Drill Polish Work Cell Saba Bahouth – UCO

24 A U-Shaped Production Line
1 2 3 4 5 6 7 8 9 10 In Out Workers Saba Bahouth – UCO

25 Process/Functional Layouts
Advantages Can handle a variety of processing requirements Not particularly vulnerable to equipment failures Equipment used is less costly Possible to use individual incentive plans Disadvantages 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 Saba Bahouth – UCO

26 Product Layout Advantages High rate of output Low unit cost
Labor specialization Low material handling cost High utilization of labor/equipment Established routing and scheduling Easy accounting and purchasing Disadvantages Creates dull, repetitive jobs Poorly skilled workers may neglect maintenance and quality Fairly inflexible to changes in volume Highly susceptible to shutdowns Needs preventive maintenance Individual incentive plans are impractical Saba Bahouth – UCO

27 Service Layouts Warehouse and storage layouts Retail layouts
Office layouts Service layouts must be functional and aesthetically pleasing Saba Bahouth – UCO

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