BA341 2nd Edition Exam 2 Study Guide Lectures 7 12 Lecture 7 September 22 Chapter 7 Process Strategies A process strategy is an organization s approach to transforming resources into goods and services The object is to produce products that meets customer requirements within cost and other managerial constraints Common strategies Process Focused o Volume low product volume o Variety supports a high degree of product flexibility and customization o Equipment type general purpose equipment and skilled personnel o Utilization high variable costs and low equipment utilization Repetitive Focus o Volume high product volume o Variety less product flexibility then process focused o Equipment type characterized by modules with parts they may be combined in different ways facilities often organized as assembly lines o Utilization low variable costs Product Focused o Volume high volume o Variety low variety o Equipment type highly specialized equipment and generally less skilled labor o Utilization high fixed costs but low variable costs Mass Customization o Volume high volume o Variety high variety o Equipment many modules with flexible operators o Utilization aims to combine the efficiency of the product focus with the flexibility of the process focus Lecture 8 September 24th Chapter 9 Layout Strategies Fixed Position project Layout o Characteristics product in a fixed location o Production Volume specific to unique large scale products projects Low volume o Pattern of workflow equipment and workers moved close to the product constantly changing workforce Process oriented Job Shop layout o Characteristics products move from department to department according to custom characteristics o Volume job shop compete on quality customization speed of new production introduction o Workflow similar equipment is grouped together equipment is usually general purpose but flexible and capable of extensive customization Employees highly skilled and can operate a variety of machines Cellular Layout Work Cell o Characteristics Dedicated area containing various equipment needed to produce only a limited range of products from start to finish o Volume high volume with lower inventory levels and lower space requirements o Workflow higher equipment utilization and higher employee productivity Repetitive and Product oriented Layout o Characteristics low unit costs for high volume operations o Volume high volume standardized operations o Workflow linear layout whereby production follows a fixed sequence of steps parts move at a controlled rate usually by a mechanized conveyor system Equipment is mostly special purpose Continuous Process Layout o Characteristics operated on a continuous basis to produce a few standardized products o Volume high volume o Workflow similar to an assembly line but the product flow is continuous rather than discrete Lecture 9 September 29th Chapter 16 Lean Principles Lean production is a set of integrated activities designed to achieve high volume production while minimizing waste in the production process Ways to minimize sources of waste o Reduce inventories of raw materials WIP and finished products overproduction o Reduce defects and rework due to poor quality o Reduce waiting due to resource or part unavailability o Reduce unnecessary transportation and motion when working on a unit only do the needed movement no more o Reduce overprocessing work that doesn t add value Classification of Lean prinicples o Process Flow represents the logical sequence of steps transform inputs into outputs needed to deliver the product service to the customer It may include the passing of information or materials from one step to the next o Managing the Flow Make to Stock Push output is pushed to the next station as it is completed based on Demand Forecast Make to Order Pull a workstation pulls output from the preceding station as needed based on Demand fixed inventory o Controlling Flow Drum Buffer Rope Drum represents the system bottleneck gives the beat for the whole system Buffer a protection for the drum measured in time all resources that feed the bottleneck must be given enough time to overcome any delays Rope release materials only when needed Prevents early release of materials Prevents accumulation of WIP o Little s Law WIP THt x THr WIP represents amount of work in process THt is the throughput time i e time in system THr is the throughput rate Lecture 10 October 1st Continuing Chapter 16 Lean Principles Elements of Lean production How much WIP should we have High inventory WIP hides problems Lower levels of WIP expose problems o If you adopt lean operations then lower inventory gradually Emphasize JIT production o Employ a Pull production system How are WIP and Throughput Time in a Pull system compared to a Push System Better to adopt the pull system because there is lower inventory and a shorter throughput time A pull system is demand driven Use one piece flow o Move products one unit at a time if possible between workstations to improve throughput o Requires constant effort to reduce setup times Determining the Number of Kanban Cards Containers each container represents the minimum production lot size and the number of such containers determines directly the amount of WIP in system K Expected demand during lead time Safety Stock Size of the container DL S C o D average demand per period for assembly line downstream o L lead time to replenish an order upstream o S safety stock expressed in days hours etc of demand o C Container size Determining max allowable WIP Lecture 11 October 6th Lean in Services Lean principles Successfully applied in various service settings such as fast food retail transportation banking insurance legal services etc o Focus on improved process standardization lower inventory better quality shorter turn around times improved scheduling capacity buffering Making inroads in other services such as healthcare and administration Service Blueprint The F is a reminder to not forget something in the system Service is broken into 3 levels Level 1 only has to do with the customer Level 2 Customer and service provider interact Level 3 the service is performed Lecture 12 October 8th Review for the test during this lecture