1. Chapter 7: Process Strategy and Sustainability

2. Global Company Profile: Harley-Davidson Four Process Strategies
Summary
Global Company Profile: Harley-Davidson
Four Process Strategies
Process Focus
Repetitive Focus
Product Focus
Mass Customization Focus
Comparison of Process Choices

3. Process Analysis and Design
Outline
Process Analysis and Design
Flow Charts
Time-Function Mapping
Value-Stream Mapping
Process Charts
Service Blueprinting

4. Special Consideration for Service Process Design
Outline – Continued
Special Consideration for Service Process Design
Customer Interaction and Process Design
More Opportunities to Improve Service Processes
Selection of Equipment and Technology

5. Production Technology
Outline – Continued
Production Technology
Machine Technology
Automatic Identification Systems (AISs) and RFID
Process Control
Vision Systems
Robots

6. Production Technology (cont.)
Outline – Continued
Production Technology (cont.)
Automated Storage and Retrieval Systems (ASRSs)
Automated Guided Vehicles (AGVs)
Flexible Manufacturing Systems (FMSs)
Computer-Integrated Manufacturing (CIM)

7. Technology in Services
Outline – Continued
Technology in Services

8. Four basic strategies Process focus Repetitive focus Product focus
Process Strategies
Four basic strategies
Process focus
Repetitive focus
Product focus
Mass customization
Within these basic strategies there are many ways they may be implemented

9. Process Focus
Facilities are organized around specific activities or processes
General purpose equipment and skilled personnel
High degree of product flexibility
Typically high costs and low equipment utilization
Product flows may vary considerably making planning and scheduling a challenge

10. Process Focus (low volume, high variety, intermittent processes)
Many inputs
(surgeries, sick patients, baby deliveries, emergencies)
Many different outputs (uniquely treated patients)
Many departments and many routings
(low volume, high variety, intermittent processes)
Arnold Palmer Hospital
Figure 7.2(a)

11. Facilities often organized as assembly lines
Repetitive Focus
Facilities often organized as assembly lines
Characterized by modules with parts and assemblies made previously
Modules may be combined for many output options
Less flexibility than process-focused facilities but more efficient

12. Repetitive Focus (modular) Harley Davidson
Raw materials and module inputs
Modules combined for many
Output options
(many combinations of motorcycles)
Few modules
(multiple engine models, wheel modules)
(modular)
Harley Davidson
Figure 7.2(b)

13. Facilities are organized by product
Product Focus
Facilities are organized by product
High volume but low variety of products
Long, continuous production runs enable efficient processes
Typically high fixed cost but low variable cost
Generally less skilled labor

14. Product Focus (low-variety, high volume, continuous process) Frito-Lay
Few Inputs
(corn, potatoes, water, seasoning)
Output variations in size, shape, and packaging
(3-oz, 5-oz, 24-oz package labeled for each material)
(low-variety, high volume, continuous process)
Frito-Lay
Figure 7.2(c)

15. Hot mill for finishing, cooling, and coiling
Product Focus
Scrap steel
Ladle of molten steel
Electric furnace A B C
Continuous caster
Continuous cast steel sheared into 24-ton slabs
Hot tunnel furnace ft
Hot mill for finishing, cooling, and coiling D E F G H I
Nucor Steel Plant

16. Mass Customization
The rapid, low-cost production of goods and service to satisfy increasingly unique customer desires
Combines the flexibility of a process focus with the efficiency of a product focus

17. Mass Customization Number of Choices Item 1970s 21st Century
Vehicle models
Vehicle types 18 1,212
Bicycle types ,000
Software titles 0 400,000
Web sites ,000,000
Movie releases per year
New book titles 40, ,000
Houston TV channels 5 185
Breakfast cereals
Items (SKUs) in 14, ,000
supermarkets
LCD TVs
Number of Choices
Item 1970s 21st Century
Table 7.1

18. Mass Customization (high-volume, high-variety) Dell Computer
Many parts and component inputs
Many output versions
(custom PCs and notebooks)
Many modules
(chips, hard drives, software, cases)
(high-volume, high-variety)
Dell Computer
Figure 7.2(d)

19. Mass Customization Repetitive Focus Mass Customization Process-Focused
Flexible people and equipment
Figure 7.3
Modular techniques
Accommodating Product and Process Design
Responsive Supply Chains
Mass Customization
Rapid throughput techniques
Effective scheduling techniques
Process-Focused
High variety, low volume
Low utilization (5% to 25%)
General-purpose equipment
Product-Focused
Low variety, high volume
High utilization (70% to 90%)
Specialized equipment

20. Imaginative and fast product design Rapid process design
Mass Customization
Imaginative and fast product design
Rapid process design
Tightly controlled inventory management
Tight schedules
Responsive supply chain partners

21. Comparison of Processes
Process Focus
(low-volume, high-variety)
Repetitive Focus
(modular)
Product Focus
(high-volume, low-variety)
Mass Customization
(high-volume, high-variety)
Small quantity and large variety of products are produced
Long runs, usually a standardized product with options, produced from modules
Large quantity and small variety of products are produced
Large quantity and large variety of products are produced
Equipment used is general purpose
Special equipment aids in use of an assembly line
Equipment used is special purpose
Rapid changeover on flexible equipment
Table 7.2

22. Comparison of Processes
Process Focus
(low-volume, high-variety)
Repetitive Focus
(modular)
Product Focus
(high-volume, low-variety)
Mass Customization
(high-volume, high-variety)
Operators are broadly skilled
Employees are modestly trained
Operators are less broadly skilled
Flexible operators are trained for the necessary customization
There are many job instructions because each job changes
Repetitive operations reduce training and changes in job instructions
Work orders and job instructions are few because they are standardized
Custom orders require many job instructions
Table 7.2

23. Comparison of Processes
Process Focus
(low-volume, high-variety)
Repetitive Focus
(modular)
Product Focus
(high-volume, low-variety)
Mass Customization
(high-volume, high-variety)
Raw-material inventories high relative to the value of the product
JIT procurement techniques are used
Raw material inventories are low relative to the value of the product
Work-in-process is high compared to output
JIT inventory techniques are used
Work-in-process inventory is low compared to output
Work-in-process inventory driven down by JIT, kanban, lean production
Table 7.2

24. Comparison of Processes
Process Focus
(low-volume, high-variety)
Repetitive Focus
(modular)
Product Focus
(high-volume, low-variety)
Mass Customization
(high-volume, high-variety)
Units move slowly through the facility
Assembly is measured in hours and days
Swift movement of units through the facility is typical
Goods move swiftly through the facility
Finished goods are usually made to order and not stored
Finished goods made to frequent forecast
Finished goods are usually made to forecast and stored
Finished goods are often build-to-order (BTO)
Table 7.2

25. Comparison of Processes
Process Focus
(low-volume, high-variety)
Repetitive Focus
(modular)
Product Focus
(high-volume, low-variety)
Mass Customization
(high-volume, high-variety)
Scheduling is complex, concerned with trade-offs between inventory, capacity, and customer service
Scheduling is based on building various models from a variety of modules to forecasts
Scheduling is relatively simple, concerned with establishing output rate sufficient to meet forecasts
Sophisticated scheduling is required to accommodate custom orders
Fixed costs tend to be low and variable costs high
Fixed costs dependent on flexibility of the facility
Fixed costs tend to be high and variable costs low
Fixed costs tend to be high, variable costs must be low
Table 7.2

26. Global Company Profile: Harley-Davidson Four Process Strategies
Summary
Global Company Profile: Harley-Davidson
Four Process Strategies
Process Focus
Repetitive Focus
Product Focus
Mass Customization Focus
Comparison of Process Choices