Presentation is loading. Please wait.

Presentation is loading. Please wait.

Process Strategy and Capacity Planning

Similar presentations

Presentation on theme: "Process Strategy and Capacity Planning"— Presentation transcript:

1 Process Strategy and Capacity Planning

2 Introduction What: Making process and capacity decisions
Where: Produce goods and services Why: Long term effects on company

3 Process Focus Complete jobs on demand Low volume High variety
“Job shop” Products move between processes High flexibility

4 Repetitive Focus Modules Assemble Modules into finished products
More structure Less flexibility Some customizing

5 Product Focus Produce one product High volume Low variety
Continuous process

6 Mass Customization Focus
Individualized goods and services What customer wants when they want it Volume of product focus with flexibility of process focus

7 Comparing Process Choices
Repetitive Product Mass Cust Quantity/ Variety Small / Large Long runs, some options Large / Small Large / Large Equipment General Special Flexible People/Training Skilled Modest Train Less skilled Job Instructions Many Some Few Raw Materials Large JIT Small Work in Process High Low Speed Slow Medium Fast Finished Goods To order To forecast Scheduling Complex Forecast Simple Costs Low fixed High fixed Costing Hard Easy

8 Process Analysis Tools
Designed to achieve competitive advantage? Eliminate steps that do not add value? Maximize customer value? Win orders?

9 Flow Diagram Information flow Material flow Customer Purchasing
Shipping Customer Customer sales representative take order Prepress Department (Prepare printing plates and negatives) Printing Department Collating Department Gluing, binding, stapling, labeling Polywrap Department Purchasing (order inks, paper, other supplies) Vendors Receiving Warehousing (ink, paper, etc.) Accounting Information flow Material flow

10 Time-Function Mapping
Order Product Receive product Customer Process Order Sales Production control Order Wait Order Plant A Print Product WIP Warehouse Wait Wait Wait Product WIP Plant B Extrude WIP WIP Product Transport Move Move 12 days 13 days 1 day 4 days 1 day 10 days 1 day 9 days 1 day

11 Process Charts SUBJECT: Request tool purchase Dist (ft) Time (min)
Symbol Description lðo D Ñ Write order ¡ðo w On desk 75 è o To buyer ¡ðn Examine ¡ = Operation; ð = Transport; o = Inspect; D = Delay; Ñ = Storage

12 Service Blueprinting

13 Process Design for Services
Mass Service Professional Service Service Factory Service Shop Commercial Banking General purpose law firms Fine dining restaurants Hospitals Airlines Full-service stockbroker Retailing Personal banking Boutiques Law clinics Fast food restaurants Warehouse and catalog stores No frills airlines Limited service stockbroker For-profit hospitals Degree of Interaction and Customization Degree of Labor Intensity Low High High Low

14 Process Design for Services
Layout Human Resources Technology

15 Process Reengineering
Design of Process based on initial assumptions Assumptions change! Rethink and redesign Flexibility

16 Capacity Planning Design Capacity = maximum theoretical output of system Effective Capacity = Capacity expected in current operation Utilization = Actual Output / Design Capacity Efficiency = Actual Output / Effective Capacity

17 Capacity Planning Anticipated Production = Design Capacity x Effective Capacity x Efficiency

18 Capacity Expansion Expected Demand New Capacity Demand Time in Years
Capacity leads demand with an incremental expansion

19 Capacity Expansion Expected Demand New Capacity Demand Time in Years
Capacity leads demand with a one-step expansion

20 Capacity Expansion Expected Demand New Capacity Demand Time in Years
Capacity lags demand with an incremental expansion

21 Attempts to have an average capacity, with an incremental expansion
Capacity Expansion Expected Demand Time in Years Demand New Capacity Attempts to have an average capacity, with an incremental expansion

22 Approaches to Capacity Expansion
May need to manage demand through: Staffing changes Adjusting equipment and processes Increasing throughput

23 Break-even Analysis Fixed Costs Variable Costs Contribution
Revenue Function Crossover Chart Net Present Value

24 Operations Technology

25 Design Technology Internet Intranet CAD DFMA 3-D Object Modelling STEP
CAM Virtual Reality

26 Production Technology
Numerical Control Process Control Vision Systems Robots Automated Storage and Retrieval Systems Automated Guided Vehicle Flexible Manufacturing System Computer Integrated Manufacturing

27 Information Technology
Transaction Processing System Automatic Identification System Management Information System Artificial Intelligence Expert System Fuzzy Logic Neural Network

28 Information Technology
Enterprise Resource Planning (ERP) Automate and integrate processes Share common data SAP, JD Edwards, BAAN, PeopleSoft

Download ppt "Process Strategy and Capacity Planning"

Similar presentations

Ads by Google