Transcript Slide 1
CHAPTER 4
MANUFACTURING
PROCESSES
Learning Objectives
After completing this chapter you will:
Know how production processes are organized
Know the trade-offs that need to be considered
when designing a production process
Know what the product-process matrix is
Understand how break-even analysis is just as
important in operations and supply-chain analysis
as it is in other areas
Understand how to design an assembly line
Toshiba
Producer of the 1st notebook
Strength in the notebook market
Aggressively priced products
Technologically innovative products
Retaining its position by
Relentlessly improving its manufacturing processes
Lowering its costs
Designing Toshiba’s notebook computer line
The case at the end of this chapter
Production Processes
Process selection
Strategic decision of selecting which kind of production
processes to use to produce a product or provide service
Five basic structures (defined by the general
pattern of workflow)
Project
Workcenter
Manufacturing cell
Assembly line
Continuous process
Project
Product remains in a fixed location.
Manufacturing equipment is moved to the product.
Chapter 2 describes project management techniques.
Workcenter (WC)
Place where similar equipment of functions grouped
together.
A part being worked on then travels from WC to
WC.
Jobshop
Manufacturing Cell
A dedicated area where products that are similar in
processing requirements are produced.
A firm may have many different cells in a production
area
Assembly Line
Assembly line
Where work processes are arranged according to the
progressive steps by which the product is made.
Discrete parts are made by moving from workstation
to workstation at a controlled rate.
Ex.
Toys, appliances, automobiles
Continuous Process
Similar to an assembly line, but the flow is
continuous rather than discrete.
Such structures
Are highly automated
Constitute one integrated “machine”
Ex.
Petroleum, chemicals, drugs
Product-Process Matrix:
Framework Describing Layout
Strategies
Low one-of-a-kind
Project
Workcenter
Manufacturing
Cell
Assembly
Line
Continuous
Process
Product
Standardization
High standardized
commodity
product
Low
Product Volume
High
Equipment Selection
Trade-off between
More specialized vs. Less specialized
Special-purpose vs. General-purpose
Ex.
Drill press vs. Hand drill
[Setup time] Some time vs. Quick
[Time per unit] Quick vs. Slow
Break-Even Analysis
A standard approach to choosing alternative
processes or equipment.
Break-even chart
Alternative profits and losses vs. # of units produced or sold
The choice obviously depends on anticipated
demand
Suitable when
There is a large initial investment and fixed cost
Variable costs are proportional to the # of units produced
Break-Even Analysis
Break-Even Point = Break-Even Demand
the point in units produced (and sold)
where we will start making profit on the process or equipment
where total revenue and total cost are equal
Break-Even Point for single alternative
Break-Even Analysis (Continued)
Break-even Demand=
Purchase cost of process or equipment
Price per unit - Cost per unit
or
Total fixed costs of process or equipment
Unit price to customer - Variable costs per unit
This formula can be used to find any of its
components algebraically if the other
parameters are known
Break-Even Analysis (Continued)
Example: Suppose you want to purchase a new
computer that will cost $5,000. It will be used to
process written orders from customers who will
pay $25 each for the service. The cost of labor,
electricity and the form used to place the order is
$5 per customer. How many customers will we
need to serve to permit the total revenue to breakeven with our costs?
Break-even Demand:
= Total fixed costs of process or equip.
Unit price to customer – Variable costs
=5,000/(25-5)
=250 customers
Example 4.1
Three options for obtaining a machined part
Purchase at $200 per unit (no fixed cost)
Make it at $75 per unit using semiauto-lathe
Make it at $15 per unit using MC
Fixed cost
Semiautomatic lathe: $80,000
Machining center: $200,000
Break-Even Analysis for multiple options
Example 4.1
Layout of Production Process
Project Layout
Visualize a product as the hub of wheel
Materials and equipment arranged concentrically around the
production point in the order of use and movement difficulty
A project layout may be developed by arranging
materials according to their technological priority.
Workcenters Layout
Arrange WCs in a way that optimizes the movement
of material
Manufacturing Cell Layout
Allocating dissimilar machines to cells
that are designed to work on products
that have similar shapes and processing requirements
Developing a manufacturing cell
Group parts into families
Identify dominant flow patterns for each part family
Regroup machines into cells
Manufacturing Cell Layout
Manufacturing Cell Layout
Assembly Line Layouts
Continuous Process Layout
Assembly-Line Design
Workstation cycle time
The time between successive units coming off the end of the
line.
At workstation,
Work is performed on a product
By adding parts
By completing assembly operations
The work is made up of many bits of work, i.e., tasks.
Assembly-Line Balancing
Assembly-line balancing problem
Assigning all tasks to a series of workstations
Sum of processing time of tasks in each workstation cannot be
larger than workstation cycle time.
Unassigned time across all workstations is minimized
Assembly-Line Balancing
Procedure
1. Specify the sequential relationships among tasks
2. Determine the required workstation cycle time (C)
3. Determine the theoretical minimum number of
workstations N
4. Select assignment rules
5. Assign tasks to form 1st WC using AS rules. Repeat
the process until all tasks are assigned
6. Evaluate the efficiency
7. If unsatisfactory, rebalance
t
Example 4.2
The Model J Wagon
Workstation cycle time
Production time per day: 420 mins.
Required output per day: 500 wagons
Find the balance that minimizes the # of WC
Example 4.2
Example 4.2
Step 1
Example 4.2
Step 2
C = (Production time per day)/(Output per day)
= 60 × 420 / 500 = 25200/500
= 50.4
Step 3
N t = T/C
= 195/50.4 = 3.87
=4
Example 4.2
Step 4
Assignment rule
Primary rule: the largest number of following tasks.
Secondary rule: the longest task time.
Example 4.2
Step 5
Example 4.2
Step 5
Example 4.2
Step 6
Efficiency = T/( N aC) = 195/(5)(50.4)
= .77 or 77%
Step 7
Imbalance
23% idle time
Workstation 5!
Better balance?
Splitting Tasks
Longest time task
Shortest workstation cycle time
Lower time bound
Example
Tasks with times 40, 30, 15, 25, 20, 18
Line runs 450 mins. & output demand is 750
C = 36 secs.
40-second task ?
Splitting Tasks
Split the task
Share the task
Use parallel workstations
Use a more skilled worker
Work overtime
Redesign the product
Flexible and U-Shaped Line
Flexible and U-Shaped Line
Flexible and U-Shaped Line
Mixed-Model Line Balancing
Objective
Meet the demand for a variety of products
Avoid building high inventories
MML balancing
Scheduling several different models
Question Bowl
What is the break-even in demand for
a new process that costs $25,000 to
install, will generate a service
product that customers are willing
to pay $500 per unit for, and whose
labor and material costs for each
unit is $100?
a. 400 units
b. 250 units
c. 100 units
d. 62.5 units
e. None of the above
Question Bowl
Which of the following is an example
of a Continuous process?
a. Fast food
b. Grocery
c. Hospitals
d. Chemical company
e. None of the above
Summary
Five Basic Production Processes
Project, WC, Manufacturing Cell, Assembly Line, Continuous
Process
Break-Even Analysis
Production system layout
Assembly line design
End of Chapter 4