Lecture Operations and supply chain management: The Core (3/e) – Chapter 6: Manufacturing and service processes

Manufacturing and
Service Processes
Chapter 06
McGraw­Hill/Irwin

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Learning Objectives
1.
2.

3.
4.

5.
6.

7.

Understand what a production process is.
Understand the idea of production process
mapping.
Define Little’s law.
Demonstrate how production processes are
organized.
Describe the product-process matrix.
Provide an overview of how the different types of
production processes are designed.
Understand how to design and analyze an
assembly line.

6­2


Types of Firms

6­3


Make-to-Stock


Examples of products






Essential issue in satisfying customers is to balance
the level of inventory against the level of customer
service





Televisions
Clothing
Packaged food products

Easy with unlimited inventory but inventory costs money
Trade-off between the costs of inventory and level of
customer service must be made

Use lean manufacturing to achieve higher service
levels for a given inventory investment

6­4


Assemble-to-Order


A primary task is to define a customer’s order in terms
of alternative components since these are carried in
inventory






An example is the way Dell Computer makes their desktop
computers

One capability required is a design that enables as
much flexibility as possible in combining components
There are significant advantages from moving the
customer order decoupling point from finished goods

to components

6­5


Make-to-Order/Engineer-toOrder






Boeing’s process for making commercial
aircraft is an example
Customer order decoupling point could be in
either raw materials at the manufacturing site
or the supplier inventory
Depending on how similar the products are it
might not even be possible to pre-order parts

6­6


Production Process Mapping






Develop a high-level map of a supply chain
process
Useful to understand how material flows and
where inventory is held
First step in analyzing the flow of material
through a production process

6­7


Inventory Measures


Total average value of inventory - the sum of the
value (at cost) of the raw material, work-in process,
and finished goods inventory




Inventory turns - the cost of goods sold divided by the
average inventory value




Commonly tracked in accounting systems and reported in
financial statements

Not particularly useful for evaluating the performance of a

process

Days of supply - the inverse of inventory turns scaled
to days
6­8


Organization of Production
Processes

6­9


Production System Design

6­10


Production System Design

6­11


Manufacturing Cell
Development
1.

2.

3.

Group parts into
families that
follow a common
sequence of
steps.
Identify dominant
flow patterns for
each part family
Machines and
the associated
processes are
physically
regrouped into
cells

Workcenter layout –
similar machines
grouped together

6­12


Regrouped Machines

Manufacturing cell
layout – dissimilar
machines grouped
together by product

6­13


Assembly Line Design


Workstation cycle time - a uniform time interval in
which a moving conveyor passes a series of
workstations






Also the time between successive units coming off the line

Assembly-line balancing - assigning tasks to a series
of workstations so that the required cycle time is met
and idle time is minimized
Precedence relationship - the order in which tasks
must be performed in an assembly process

6­14


Mixed-Model Line Balancing


Most factories produce a number of different

products




Inventory can be reduced by building some of
each product during every period (e.g. day, week,
etc.)

Mixed-model line balancing is one means of
scheduling this varied production

6­15