Process Structure in Manufacturing
Important Point. A new line is suggested. For a line in the chapter, I suggested a new line.
The manufacturing manager has four process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, and (4) continuous-flow process (Krajewski et al).
Needs to be changed to
The manager has five process choices, which form a continuum, to choose from: (1) job process (lean job process?), (2) batch process, (3) line process, (4) lean line process and (5) continuous-flow process (Narayana Rao 29 August 2019 https://nraomtr.blogspot.com/2019/08/add-lean-to-manufacturing-processes.html ).
Lean job process - Modern Industrial Engineering and Lean in Low Volume - High Mix Production - Shahrukh Irani, Narayana Rao and Others
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Process Structure in Manufacturing
Process Strategy Decisions
Explain the major process strategy decisions and their implications for operations.
Strategic Fit
Discuss how process decisions should strategically fit together.
Strategies for Change
Compare and contrast the two commonly used strategies for change, and understand a systematic way to analyze and improve processes.
Defining, Measuring, and Analyzing the Process
Discuss how to document and analyze/evaluate processes.
Redesigning and Managing Process Improvements
Identify the commonly used approaches for effectively redesigning and managing processes.
CVS Pharmacy
Processes use the organization’s resources to provide something of value. The output is a product or service.
Three principles are particularly important in process strategy making.
1. The key to successful process decisions is to make choices that fit the situation and that make sense together. In an effective enterprise process, or process chain, each process must have a close strategic fit with the business strategy and also with other processes with which it has interaction.
2. The individual processes are the building blocks that eventually create the firm’s whole supply chain. The cumulative effect of proper design of each process on customer satisfaction and competitive advantage is huge.
3. Whether processes in the supply chain are performed internally or by outside suppliers and
customers, management must pay special attention to the interfaces between processes. Dealing
with these interfaces underscores the need for cross-functional (process) coordination.
-------------------------------
Learning Goals - Process Strategy and Analysis
Process Structure in Manufacturing
Understand the process structure in manufacturing and how to position a manufacturing process on the product process matrix.
Process Structure in Services
Understand the process structure in services and how to position a service process on the customer-contact matrix.Process Strategy Decisions
Explain the major process strategy decisions and their implications for operations.
Strategic Fit
Discuss how process decisions should strategically fit together.
Strategies for Change
Compare and contrast the two commonly used strategies for change, and understand a systematic way to analyze and improve processes.
Defining, Measuring, and Analyzing the Process
Discuss how to document and analyze/evaluate processes.
Redesigning and Managing Process Improvements
Identify the commonly used approaches for effectively redesigning and managing processes.
Chapter Contents and Important Points - Process Strategy and Analysis
CVS Pharmacy
Processes use the organization’s resources to provide something of value. The output is a product or service.
Process strategy specifies the pattern of decisions to be made in planning and managing processes so that the processes will achieve their competitive priorities. Process analysis is the documentation and detailed understanding of the existing process about how work is performed and how it can be redesigned. Process decisions directly affect the process itself by changing process inputs and methods of using them and indirectly the services and the products that it provides. All parts of an organization, as well as external suppliers and customers across the supply chain, need to be involved in process design to ensure that processes are providing the most value to their internal and external customers.
Three principles are particularly important in process strategy making.
1. The key to successful process decisions is to make choices that fit the situation and that make sense together. In an effective enterprise process, or process chain, each process must have a close strategic fit with the business strategy and also with other processes with which it has interaction.
2. The individual processes are the building blocks that eventually create the firm’s whole supply chain. The cumulative effect of proper design of each process on customer satisfaction and competitive advantage is huge.
3. Whether processes in the supply chain are performed internally or by outside suppliers and
customers, management must pay special attention to the interfaces between processes. Dealing
with these interfaces underscores the need for cross-functional (process) coordination.
Process Structure in Services
Customer-Contact MatrixService Process Structuring
The customer-contact matrix brings together three elements:
(1) the degree of customer contact in the process serving him,
(2) customization, and
(3) service process characteristics.
The matrix is the starting point for evaluating and improving a process.
A flexible flow means that the customers, materials, or information move in diverse ways,
with the path of one customer or job often crisscrossing the path that the next one takes.
A line flow means that the customers, materials, or information move linearly from one operation to the next in the process, according to a fixed sequence. When diversity is low and the process standardized, line flows are a natural consequence.
The manager has three service process structures, which form a continuum, to choose from: (1) front office, (2) hybrid office, and (3) back office.
Process Structure in Manufacturing
Product-Process Matrix
Manufacturing Process Structuring
In the case of manufacturing good, the product–process matrix brings together three elements:
(1) volume, (2) product customization, and (3) process characteristics.
The manufacturing manager has four process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, and (4) continuous-flow process (Krajewski et al).
The manager has five process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, (4) lean process and (5) continuous-flow process (Narayana Rao 29 August 2019 https://nraomtr.blogspot.com/2019/08/add-lean-to-manufacturing-processes.html ).
Lean is a line process for multiple products with batch size approaching one. Lean process can be used in various manufacturing processes. A lean index with most desirable value of 1 can be created. Value of 1 is given to a process which used a batch quantity of one. A weighting scheme can be generated to give lean index to a factory.
By defining lean also as a process alternative, design of lean system right from the start of a new production line or system comes into existence. The operation of such greenfield lean process factories or production plants will give ideas on how to convert more legacy processes into lean processes.
Layout design is based on the manufacturing process. Job and batch processes use process layout. Line and lean processes use line layout or product layout. Continuous processes many times contain flow through pipes.
Production and Inventory Strategies
Design-to-order, make-to-order, assemble-to-order, and make-to-stock strategies are
four approaches to production and inventory creation.
A flexible flow means that the customers, materials, or information move in diverse ways,
with the path of one customer or job often crisscrossing the path that the next one takes.
A line flow means that the customers, materials, or information move linearly from one operation to the next in the process, according to a fixed sequence. When diversity is low and the process standardized, line flows are a natural consequence.
The manager has three service process structures, which form a continuum, to choose from: (1) front office, (2) hybrid office, and (3) back office.
Process Structure in Manufacturing
Product-Process Matrix
Manufacturing Process Structuring
In the case of manufacturing good, the product–process matrix brings together three elements:
(1) volume, (2) product customization, and (3) process characteristics.
The manufacturing manager has four process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, and (4) continuous-flow process (Krajewski et al).
Needs to be changed to
The manager has five process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, (4) lean process and (5) continuous-flow process (Narayana Rao 29 August 2019 https://nraomtr.blogspot.com/2019/08/add-lean-to-manufacturing-processes.html ).
Lean is a line process for multiple products with batch size approaching one. Lean process can be used in various manufacturing processes. A lean index with most desirable value of 1 can be created. Value of 1 is given to a process which used a batch quantity of one. A weighting scheme can be generated to give lean index to a factory.
By defining lean also as a process alternative, design of lean system right from the start of a new production line or system comes into existence. The operation of such greenfield lean process factories or production plants will give ideas on how to convert more legacy processes into lean processes.
Layout design is based on the manufacturing process. Job and batch processes use process layout. Line and lean processes use line layout or product layout. Continuous processes many times contain flow through pipes.
Production and Inventory Strategies
Design-to-order, make-to-order, assemble-to-order, and make-to-stock strategies are
four approaches to production and inventory creation.
Process Strategy Decisions
-
Customer Involvement
-
Resource Flexibility
-
Capital Intensity
Three other major process strategy decisions are customer involvement, resource flexibility, and capital intensity
Strategic Fit
Decision Patterns for Service Processes
Decision Patterns for Manufacturing Processes
Gaining Focus
Managerial Practice 2.1 Plants-within-a-Plant at Ford Camacari
The four strategic decisions with respect to process: process structure, Customer Involvement, Resource Flexibility, and Capital Intensity need to have fit with competitive strategy or business strategy.
Gaining focus: Plants within plants, focused factories.
Strategies for Change
-
Process Reengineering
- Process Analysis
-
Process Improvement
Process Reengineering
Reengineering is the fundamental rethinking and radical redesign of processes to improve performance dramatically in terms of cost, quality, service, and speed based on developments in science, technology or process management. Process reengineering is about engineering redesign and is done undertaken as a major project. It would normally involve substantial capital investment as number of new facilities including machines and equipment are acquired. It is normally undertaken by the facilities engineering and process engineering (process planning) department.
Process analysis leads to process improvement. To analyze the process, documentation of the process needs to be done of the working of the existing process as taking place in the shop now. This activity of recording and analyzing existing processes is the main task undertaken by industrial engineers. It is incremental improvement of the process at planned periods to capture new developments in engineering and creative ideas to apply the existing knowledge to processes inside the company. In this exercise effort is made to involve many in the company by circulating existing process charts. Examining the strategic issues also can help identify opportunities for improvement apart from operational issues. A gap analysis can be done between a process’s competitive priorities and its current competitive capability requirements.
In engineering and manufacturing process, industrial engineers carry out process improvement to improve productivity. Process improvement is based on the systematic study of the activities and flows of each process to improve it. Productivity science, engineering and management activities are involved in process productivity improvement.
Process Improvement Based on Operator/Supervisor/Engineer Suggestions and Shop-floor Based Improvements
Process improvement is based on the understanding of the process, and digging out the details. Hence frontline operators have significant ideas to contribute to process improvement. Through seeking their suggestions, process improvement is made a continuous process and incremental improvements at small and micro level keep taking place. In Toyota Motors, Ohno gave responsibility to shop floor personnel also for process improvement apart from process planning and industrial engineering.
In more detail
Processes involve the use of an organization’s resources to provide something of value. No service can be provided and no product can be
made without a process, and no process can exist without at least one service or product. A firm cannot gain competitive advantage with faulty processes. Process decisions as
such are strategic in nature. They have to designed to further a company’s long-term competitive
goals. In making process decisions, managers focus on controlling such competitive priorities as quality,
flexibility, time, and cost. Process management is an ongoing activity, with the same principles applying to both first-time and redesign choices. Many different choices are available in
selecting equipment, outsourced services, human resources, materials, work flows, and methods that transform inputs into outputs. Another choice is which processes are to be done in-house and which processes
are to be outsourced—that is, done outside the firm and purchased as materials and services. This decision
helps to define the supply chain.
Process strategy specifies the pattern of decisions made in managing processes so that the processes will achieve their competitive priorities.
Process analysis includes the documentation and understanding of how work is performed based on observation the documentation and how it can be
redesigned. Process decisions directly affect the process itself and indirectly the services and the products that it provides. All parts of an organization, as well as external suppliers and customers across the
supply chain, need to be involved to ensure that processes are providing the most value to their internal
and external customers.
Process strategy guides a variety of process decisions. It is in turn, guided by operations strategy
and the organization’s ability to obtain the resources necessary to support them.
Four basic process decisions are:
(1) process structure,
(2) customer involvement,
(3) resource flexibility, and
(4) capital intensity.
These decisions have to fit together, depending on factors such as competitive priorities, customer contact, and volume.
There are two basic change strategies for analyzing and modifying processes:
(1) process reengineering and
(2) process improvement.
Both these approaches need process analysis to identify and implement changes.
Three principles concerning process strategy are particularly important:
1. The key to successful process decisions is to make choices that fit the situation and that make sense
together. They should not work at cross-purposes, with one process optimized at the expense of
other processes. A more effective process is one that matches key process characteristics and has a
close strategic fit.
2. Individual processes are the building blocks that eventually create the firm’s whole supply chain. The cumulative effect on customer satisfaction and
competitive advantage is huge.
3. Whether processes in the supply chain are performed internally or by outside suppliers and
customers, management must pay particular attention to the interfaces between processes. Dealing
with these interfaces underscores the need for cross-functional coordination.
Whether dealing with processes for offices, service providers, or manufacturers, operations
managers must consider four common process decisions. Figure 2.1 shows that they are all important
steps toward an effective process design. These
four decisions are best understood at the process
or subprocess level rather than at the firm level.
▪ Process structure determines the process type relative to the kinds of resources needed,
how resources are partitioned between them, and their key characteristics. A layout is the
physical arrangement of operations (or departments) relative to each other.
▪ Customer involvement reflects the ways in which customers become part of the process
and the extent of their participation.
▪ Resource flexibility is the ease with which employees and equipment can handle a wide
variety of products, output levels, duties, and functions.
▪ Capital intensity is the mix of equipment and human skills in a process. The greater the cost
of equipment relative to the cost of labor, the greater is the capital intensity.
The concepts that we develop around these four decisions establish a framework within which
we can address the appropriate process design in every situation. We need to create a good fit between the four decisions.
Process structures can range from process layout or job shop to line layout or product layout dedicated to the production of one product.
Three Examples of New Process Strategy
by Brad Power
December 06, 2012
Harvard Business Review
There are three fundamental ways that companies can improve their processes in the coming decade: (1) expand the scope of work managed by a company to include customers, suppliers, and partners; (2) target the increasing amount of knowledge work (increase social collaboration to make knowledge gathering and sharing easy); and (3) reduce cycle times of developing new changes to durations previously considered impossible (agile product and process changes. Do quickly and test with the consumers).
https://hbr.org/2012/12/in-my-last-post-i-1
Defining, Measuring, and Analyzing the Process
Flowcharts
Work Measurement Techniques
Process Charts
Data Analysis Tools
Documenting and Evaluating the Process
Three major techniques for effectively documenting and evaluating processes are (1) flowcharts, (2) work measurement techniques, and (3) process charts. They allow you to document and see how an organization does its work in team discussion. The process operation is recorded to the lowest level and how well it is performing is also recorded through measurements. Thus, techniques for documenting the process facilitate finding performance gaps, generating ideas for process improvements, and also documenting the look of a redesigned process.
Flowcharts
A flowchart traces the flow of information or customers or equipment, or materials through the various steps of a process. Flowcharts are also known as flow diagrams, process maps, relationship maps, or blueprints.
Work Measurement Techniques
Process documentation needs estimates of the average time each step in the process would take. Reduction of time is process improvement and hence time estimates or measurements are needed. Time estimates are also needed for capacity planning, constraint management, performance appraisal, and scheduling.
Estimating task times may be done as reasoned guess, asking a knowledgeable person, or taking notes while observing the process. There are well developed procedures for the purpose. Measurements can also be ascertained from shop data collected for cost accounting and data recorded in information systems.
Process Charts
A process chart is an organized way of documenting all the activities performed by a person or group of people at a workstation, with a customer, or working with certain materials. It analyzes a process using information about each step in the process. Time estimates are included in process charts.
Redesigning and Managing Process Improvements
Questioning and Brainstorming
Benchmarking
Implementing
After the process analysis team or design team comes out with conceptual design of redesign of a process, people directly involved in the process are to be brought in to get their ideas and inputs. Frank Gilbreth who initiated the idea of process charts recommended showing process chart of existing process to as many people as possible to get their inputs. Involving process owners and process team members right from the inception of the redesign project by indicating the potential for improvement of the desirable outputs from the process will motivate more persons to contribute their ideas.
Raising questions about each operation of the process in a systematic way to a brainstorming group will give creative ideas to improve the process in the form of alternatives.
The questions in the case an operation of a process are:
What is being done?
Why is it being done?
What equipment is being used?
What tools and workholding are used?
Who is doing it?
How is it being done?
Where is being done?
When is being done?
How well the operation/process being done in comparison to desired measures of performance?
The above questions are followed by why questions and the alternatives that will give better performance. In the case of manufacturing processes, adequate engineering knowledge is essential to get better answers, operations and processes.
Benchmarking is knowing and understanding the operations used by competitors and comparing those operations with internal operations. The idea is to identify concepts that can be profitably employed and make the process superior by the unique ways embedded in the internal process.
The chapter gives seven mistakes that are to be avoided in process improvement implementation. The mistakes are identified by Geary Rummler and Alan Brache.
Learning Goals in Review
Reflect what have you learned? What are the gaps now?
Learning Goals - Process Strategy and Analysis
Process Structure in Manufacturing
Understand the process structure in manufacturing and how to position a manufacturing process on the product process matrix.
Process Structure in Services
Understand the process structure in services and how to position a service process on the customer-contact matrix.Process Strategy Decisions
Explain the major process strategy decisions and their implications for operations.
Strategic Fit
Discuss how process decisions should strategically fit together.
Strategies for Change
Compare and contrast the two commonly used strategies for change, and understand a systematic way to analyze and improve processes.
Defining, Measuring, and Analyzing the Process
Discuss how to document and analyze/evaluate processes.
Redesigning and Managing Process Improvements
Identify the commonly used approaches for effectively redesigning and managing processes.
Chapter Contents of Krajewski - 12th Edition
2 PROCESS STRATEGY AND ANALYSIS
Process Structure in Services
Customer-Contact MatrixService Process Structuring
Process Structure in Manufacturing
Product-Process MatrixManufacturing Process StructuringProduction and Inventory StrategiesLayout
Process Strategy Decisions
Customer InvolvementResource FlexibilityCapital Intensity
Strategic Fit
Decision Patterns for Service ProcessesDecision Patterns for Manufacturing ProcessesGaining Focus
Managerial Practice 2.1 Plants-within-a-Plant at Ford Camacari
Strategies for Change
Process ReengineeringProcess ImprovementProcess Analysis
Defining, Measuring, and Analyzing the Process
Flowcharts 66Work Measurement TechniquesProcess ChartsData Analysis Tools
Redesigning and Managing Process Improvements
Questioning and BrainstormingBenchmarkingImplementing
Learning Goals in Review
MyLab Operations Management Resources
Key Terms
Solved Problems
Discussion Questions
Problems
Active Model Exercise
Video Case Process Analysis at Starwood
Case Custom Molds, Inc.
Case José’s Authentic Mexican Restaurant
Process Improvement - Process Industrial Engineering - Relevant Chapters in Operations Management
Process Strategy and Analysis - Important Points - Operations Management - Krajewski - 12th Edition
Quality and Performance - Important Points - Summary - Krajewski - 12th Edition
Lean Systems - Important Points - Summary - Krajewski - 12th Edition
Constraint Management - Important Points - Summary - Krajewski - 12th Edition
MyLab Operations Management Resources
Key Terms
Solved Problems
Discussion Questions
Problems
Active Model Exercise
Video Case Process Analysis at Starwood
Case Custom Molds, Inc.
Case José’s Authentic Mexican Restaurant
Process Improvement - Process Industrial Engineering - Relevant Chapters in Operations Management
Process Strategy and Analysis - Important Points - Operations Management - Krajewski - 12th Edition
Quality and Performance - Important Points - Summary - Krajewski - 12th Edition
Lean Systems - Important Points - Summary - Krajewski - 12th Edition
Constraint Management - Important Points - Summary - Krajewski - 12th Edition
Process Improvement Literature - Bibliography
Process Mapping - Hugo Dimer - First Professor of Industrial Engineering
ASME - Gilbreth Process Chart and Related Engineering and Management Subjects
Process Analysis - Eliminate, Combine, Divide, Rearrange, Simplify - ECDRS Method - Barnes
Ud. 14.9.2024, 5.5.2022
Pub 19.1.2021
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