process strategy and capacity planning
DESCRIPTION
Process Strategy and Capacity Planning. Introduction. What: Making process and capacity decisions Where: Produce goods and services Why: Long term effects on company. Process Focus. Complete jobs on demand Low volume High variety “Job shop” Products move between processes - PowerPoint PPT PresentationTRANSCRIPT
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Process Strategy and Capacity Planning
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Introduction What: Making process and capacity
decisions Where: Produce goods and
services Why: Long term effects on
company
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Process Focus Complete jobs on demand Low volume High variety “Job shop” Products move between processes High flexibility
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Repetitive Focus Modules Assemble Modules into finished
products More structure Less flexibility Some customizing
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Product Focus Produce one product High volume Low variety Continuous process
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Mass Customization Focus Individualized goods and services What customer wants when they
want it Volume of product focus with
flexibility of process focus
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Comparing Process Choices
Process Repetitive Product Mass Cust
Quantity/Variety
Small / Large
Long runs, some options
Large / Small Large / Large
Equipment General Special Special Flexible
People/Training Skilled Modest Train Less skilled Skilled
Job Instructions Many Some Few Many
Raw Materials Large JIT Small Small
Work in Process High JIT Low Low
Speed Slow Medium Fast Fast
Finished Goods To order To forecast To forecast To order
Scheduling Complex Forecast Simple Complex
Costs Low fixed High fixed High fixed High fixed
Costing Hard Easy Easy Hard
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Process Analysis Tools Designed to achieve competitive
advantage? Eliminate steps that do not add
value? Maximize customer value? Win orders?
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Flow Diagram
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 flowMaterial flow
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Time-Function Mapping
Customer
Sales
Production control
Plant A
Warehouse
Plant B
Transport
Order Product
Process Order
Extrude
Receive product
Wait
Move
Wait Wait Wait
Move
Ord
er
Ord
er
WIP
WIP
WIP W
IP
Prod
uct
Prod
uct
Prod
uct
12 days 1 day 1 day 1 day 1 day13 days 4 days 10 days 9 days
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Process Charts
SUBJECT: Request tool purchase
Dist (ft) Time (min) Symbol Description
D Write order
On desk
75 D To buyer
D Examine
= Operation; = Transport; = Inspect; D = Delay; = Storage
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Service Blueprinting
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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
Deg
ree
of L
abor
Inte
nsityLow High
High Low
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Process Design for Services Layout Human Resources Technology
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Process Reengineering Design of Process based on initial
assumptions Assumptions change! Rethink and redesign Flexibility
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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
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Capacity Planning Anticipated Production = Design
Capacity x Effective Capacity x Efficiency
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Capacity Expansion
Expected Demand
Time in Years
Dem
and
New Capacity
Capacity leads demand with an incremental expansion
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Capacity ExpansionExpected Demand
Time in Years
Dem
and
New Capacity
Capacity leads demand with a one-step expansion
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Capacity ExpansionExpected Demand
Time in Years
Dem
and
New Capacity
Capacity lags demand with an incremental expansion
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Capacity ExpansionExpected Demand
Time in Years
Dem
and
New Capacity
Attempts to have an average capacity, with an incremental expansion
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Approaches to Capacity Expansion May need to manage demand
through: Staffing changes Adjusting equipment and
processes Increasing throughput
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Break-even Analysis Fixed Costs Variable Costs Contribution Revenue Function Crossover Chart Net Present Value
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Operations Technology
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Design Technology Internet Intranet CAD DFMA 3-D Object Modelling STEP CAM Virtual Reality
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Production Technology Numerical Control Process Control Vision Systems Robots Automated Storage and Retrieval Systems Automated Guided Vehicle Flexible Manufacturing System Computer Integrated Manufacturing
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Information Technology Transaction Processing System Automatic Identification System Management Information System Artificial Intelligence Expert System Fuzzy Logic Neural Network
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Information Technology Enterprise Resource Planning (ERP) Automate and integrate processes Share common data SAP, JD Edwards, BAAN, PeopleSoft