OPMA 3306 Chapter 1-4/6-8 w/ quizzes

Make-to-Order/Engineer-to-Order

-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 (ETO)

Work center design

-most common approach is to arrange them in a way that optimizes the movement of material -sometimes referred to as a department and is focused on a particular type of operation

Mixed-model line balancing

-most factories produce a number of different product - inventory can be reduced by building some of each product during every period (ex. day, week) -is one means of scheduling this varied production

Process players

-new processes -new skills -new duties -new metrics -empowerment

Make-to-Stock

-process activated to meet expected or forecast demand -customer orders are serves from target stocking level

Process owner: responsibilities

-process design -process measurement -process performance -process improvement

Production process types

-project -work center (job shop) -manufacturing cell -assembly line -continuous process

Process owner: key ingredients

-senior manager -credibility within the company -clout

Make to Stock Examples (products)

-televisions -clothing -packaged food products

Inventory turns

-the cost of goods sold divided by the average inventory value -not particularly useful for evaluating the performance of a process

Customer contact

-the physical presence of the customer in the system -service systems with a degree of customer contact are more difficult to control

Neo-classical reengineering concepts

-the process owner -the process-centric enterprise

Project layout

-the product remains in a fixed location -a high degree of task ordering is common -the layout may be developed by arranging materials according to their assembly priority

Total average value of inventory

-the sum of the value (at cost) of the raw material, work-in process, and finished goods inventory -commonly tracked in accounting systems and reported in financial statements

Process flow charting

-the use of a diagram to present the major elements of a process -an ideal methodology

Dominant issue: SOD

-too much capacity generates excessive costs -insufficient capacity leads to lost customers -marketing can influence demand

Reengineering is NOT

-total quality management -continuous improvement -six sigma -cost-based restructuring

Influencer

-understand the process -identify the leader -help the leader grasp the problem -become part of the solution

Break-even analysis

-understanding how profits (and losses) change for each option as the total number of units varies -useful when processes have a significant initial investment and production costs vary in proportion to the number of units produced

Production processes

-used to make any manufactured item -step 1: source the parts needed -step 2: make the product -step 3: deliver the product

Top 10 don'ts of reengineering

1. leadership gap 2. functional focus 3. as-is overdose 4. timid redesign 5. reengineer in name only 6. big bang 7. reengineer slowly 8. scared cows 9. too much detail 10. ignore people's concerns

The eight wastes (MUDA)

1. overproduction 2. inappropriate processing 3. waiting 4. transportation 5. motion 6. inventory 7. defects 8. underutilization of employees

Reducing process flow time

1. perform activities in parallel 2. change the sequence of activities 3. reduce interruptions

Three takeaways (6b)

1. reengineering and its progeny live on 2. process-centric management can be win-win for all stakeholders 3. professionals in all disciplines will be involved in reengineering

Bundle of service packages

1. supporting facility 2. facilitating goods 3. information 4. explicit services 5. implicit services

Reengineering by any other name 1. classic reengineering 2. what's new 3. pass or play

1. why did it go underground? 2. and what do we call it today? 3. what's in it for you?

Manufacturing cell design

1: group parts into families that follow a common sequence of steps 2: identify dominant flow patterns for each part family 3: machines and the associated processes are physically regrouped into cells

Little's law equation

Inventory = (throughput) x (flow time) throughput: long term average rate of flow through the process flow time: time for a single unit to traverse the entire process inventory: materials held by the firm for future use

Manufacturing cell: system design

formed by allocating dissimilar machines to cells that are designed to work on similar products

Assemble-to-order: Capability required

is a design that enables as much flexibility as possible in combining components

Dr. Michael Hammer said....

it's not a process unless it's capable of making at least three people mad

Make-to-order

make the customers products from raw materials, parts, and components

Overproduction

manufacturing an item before it is needed

Work center: Optimal placement

means placing them with large interdepartmental traffic adjacent to each other

Assemble-to-order: Advantages are gained by...

moving the customer order decoupling point from finished foods to sub-assemblies and components

Blocking

occurs when the activities in a stage must stop because there is no place to deposit the item

Starving

occurs when the activities in a stage must stop because there is no work

Make-to-Order

only activated in response to an actual order -both work-in-process and finished goods inventory kept to a minimum

Information

operations data or information that is provided by the customer to enable efficient and customized services

Defects

quality defects result in rework and scrap and add wasteful costs to the system in the form of lost capacity, rescheduling effort, increased inspection, and loss of customer goodwill.

Utilization

ratio of the time that a resource is active to its time available for use

Make-to-stock

serve customers from finished goods inventory

Services: operational classes

service organizations are classified according to the customers they serve and the services they provide (customer contact/ creation of the service)

Work center (job shop)

similar equipment of functions are grouped together

Bottleneck

stage that limits the capacity of the process

Process analysis

studying elements of a process in order to improve its performance

Cycle time

the average time between completions of successive units of outputs in a process

Explicit services

the benefits that are readily observable and which make up the essential features of the service

Little's law

the flow of items through a production process

Reengineering is...

the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance, such as cost, quality, service, and speed

Days of supply

the inverse of inventory turns scaled to days

Facilitating goods

the material purchased or consumed by the buyer or the items provided to the customer

Precedence relationship

the order in which tasks must be performed in the assembly process

Supporting facility

the physical resources that must be in place before a service can be offered

Project

the product remains in a fixed location, equipment is moved to the product

Implicit services

the psychological benefits or other extrinsic features of the service

Lead time

the time needed to respond to a customer order

Creation of the service

the work process involved in providing the service itself

Make-to-stock: Essential issue in satisfying customers is....

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

Assemble-to-order: Primary task

to define and product in terms of alternative components that are carried in inventory

Mixed-model example: -processing must be completed for both Model J and Model K -equal number of each model are required cycle-time: 6 minutes for Model J and 4 minutes for Model K -in an 8 hour day, how should the models be processed?

total processing time= 6K + 4J = 480 -since K=J, we can produce 48 of each per day (6 of each per hour)

Motion

unnecessary effort related to the ergonomics of bending, stretching, reaching, lifting, and walking

Order accuracy (reengineering)

up 25%

Inappropriate processing

using expensive high precision equipment when simpler machines would suffice

Waiting

wasteful time incurred when product is not being moved or processed.

Customer order decoupling point

where inventory is positioned to allow entities in the supply chain to operate independently

Assembly line

work processes are arranged according to the progressive steps by which the product is made

Engineer-to-order

work with the customer to design and then make the product

underutilization of employees

failure of the firm to learn from and capitalize on its employees' knowledge and creativity impedes long-term efforts to eliminate waste

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

Task splitting possibilities

-Split the task -Share the task -Use parallel workstations -Use a more skilled worker -Work overtime -Redesign

Process design team

-assign the A players -multiple disciplines -process training -creative thinking -hard to go back

Leader

-define the enterprise -assess readiness -commit resources -walk the walk -communicate

Just-in-time system

-incorporates the generic elements of lean -the key is that excess capacity or inventory hides process problems

Types of inventory flows

-make-to-stock -assemble-to-order -make-to-order -engineer-to-order

Assemble-to-order

Combine a number of preassembled modules to meet a customer's specifications

Manufacturing cell

a dedicated area where products that are similar in processing requirements are produced

Lean manufacturing

a means of achieving high levels of customer service with minimal inventory investment

Waiting line models

a quantitative tool for analyzing common service situations

Buffer

a storage area between stages where the output of a stage is placed prior to being used

Benchmarking

a systematic procedure that compares a firm's processes, services, and products against another firm

Workstation cycle time

a uniform time interval in which a moving conveyor passes a series of workstations

Make-to-stock uses lean manufacturing to

achieve higher service levels for a given inventory investment

Lean systems

affect a firm's internal linkages between its core and supporting processes and its external linkages with its customers and suppliers

Process

any part of an organization that takes inputs and transforms them into outputs

Continuous process

assembly line only the flow is continuous such as with liquids

Assembly-line balancing

assigning tasks to a series of workstations so that the required cycle time is met and idle time is minimized

Competitive benchmarking

based on comparisons with a direct competitor

Basic elements of process flow charting

can include tasks/operations, flows of materials/customers, decision points, and storage areas/queues

Services _____ be stored in ______

can't

Internal benchmarking

compares an organizational unit with superior performance with other units

Functional benchmarking

compares areas with those of outstanding firms in any industry

Fulfillment time (reengineering)

cut 60%-90%

Product development time (reengineering)

cut 75%

Transaction costs (reengineering)

cut 80%

Procurement time (reengineering)

cut 90%

Assembly line/Continuous layout design

designed for the special purpose of building a product by going through a series of progressive steps

Inventory

excess inventory hides problems on the shop floor, consumes space, increases lead time, and inhibits communication

Transportation

excessive movement and material handling of product between processes