Download - 24594022 Chapter 4 Process Design
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Chapter 4
Process design
Source: Joe Schwarz, www.joyrides.com
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Process design
Operations strategy
Design Improvement
Planning and control
Operations management
Process design
Supply network design
Layout and flow
Process technology
Job design
Product/service design
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Nature and purpose of the design activity
Products, services and the processes which produce them all have to be designed
Decisions taken during the design of a product or service will have an impact on the decisions taken during the design of the process which produces those products or services, and vice versa
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Products and services should be designed in such a way that they
can be created effectively
Designing the product or service
Processes should be designed so they can
create all products and services which
the operation is likely to introduce
Designing the process
Product / service design has an impact on the
process design and vice versa
Design of products / services and design of processes are interrelated and should be treated together
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Design of the Service
Design of the Process
Design of the Product
Design of the Process
In most service operations the overlap between service
and process design is implicit in the nature of
service
In manufacturing operations overlapping the activities of product and process design
is beneficial
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Delay (a wait, e.g. for materials)
Operation (an activity that directly adds value)
Inspection (a check of some sort)
Transport (a movement of something)
Storage (deliberate storage, as opposed to a delay)
Process mapping symbols derived from ‘Scientific
Management’
Decision (exercising discretion)
Process mapping symbols derived from Systems Analysis
Direction of flow
Input or output from the process
Activity
Beginning or end of the process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Designing processes
There are different ‘process types’
Process types are defined by the volume and variety of ‘items’ they process
Process types go by different names depending on whether they produce products or services
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Hig
h
VolumeLow High
Var
iety
Project
Low
Manufacturing process types
Process tasks
Process flow
Diverse/ complex
Repeated/ divided
Intermittent
Continuous
Jobbing
Batch
Mass
Contin-uous
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
One-off, complex, large-scale ‘products’ with high work content
Specially made, every one ‘customized’
Defined start and finish: time, quality and cost objectives
Many different skills have to be coordinated
Project processes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
A project process with a small part of the process map that would describe the whole process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Very small quantities: ‘one-offs’, or only a few required
Specially made: high variety, low repetition, ‘strangers’, every one ‘customized’
Skill requirements are usually very broad
Skilled jobber, or team, completes whole product
Jobbing processes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Preparing photolithography materials on a jobbing basis with a typical process map
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Higher volumes and lower variety than for jobbing
Standard products, repeating demand. But can make specials
Specialized, narrower skills
Set-ups (changeovers) at each stage of production
Batch processes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
A batch process in a kitchen together with an illustrative process map
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Higher volumes than batch
Standard, repeat products (‘runners’)
No set-ups, or almost instantaneous ones
Low and/or narrow skills
Mass (line) processes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
A mass process – a packing process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Extremely high volumes and low variety:often single product
Standard, repeat products (‘runners’)
Highly capital-intensive and automated
Few changeovers required
Difficult and expensive to start and stop the process
Continuous processes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Part of a continuous process and a typical process map
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
VolumeLow High
Var
iety
Low
Hig
h
Service process typesProcess
tasksProcess
flow
Diverse/ complex
Repeated/ divided
Intermittent
Continuous
Professional service
Service shop
Mass service
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
A professional service –Consultants planning how best to help their client
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
A service shop – This health club offers some varietywithin a standard set of facilities and processes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
A mass service – This call centre can handlea very high volume of customer enquiries because it
standardizes its process
Source: Royal Bank of Scotland Group
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Deviating from the ‘natural’ diagonal on the product–process matrix has consequences for cost and flexibility
None
None
Less process flexibility than is needed so
high cost
More process flexibility than is
needed so high cost
The ‘natural’ line of fit of process to volume/variety characteristics
Project
Jobbing
Batch
Mass
Continuous
Manufacturing operations
process types
Professionalservice
Serviceshop
Massservice
Service operations
process typesVariety
Volume
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Deviating from the ‘natural’ diagonal on the product–process matrix has consequences for cost and flexibility
None
None
Variety
Volume
Old process
Old process,
new product
New process,
new product
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Flow (layout), technology and job design are all influencedby process positioning
None
None
Variety
Volume
Machine tool maker
Custom furniture maker
Automobile factory
Petro- chemical refinery
Flow Technology Jobs
Unorganized
Predictable
Little / general
Specialist
Varied / high discretion
Routine / low discretion
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Flow (layout), technology and job design are all influencedby process positioning
None
None
Variety
VolumeFlow Technology Jobs
Unorganized
Predictable
Little / general
Specialist
Varied / high discretion
Routine / low discretion
Customer service branch
Investment banking
Bank call centre
Credit card processing
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Delay (a wait, e.g. for materials)
Operation (an activity that directly adds value)
Inspection (a check of some sort)
Transport (a movement of something)
Storage (deliberate storage, as opposed to a delay)
Process mapping symbols derived from ‘Scientific
Management’
Decision (exercising discretion)
Process mapping symbols derived from Systems Analysis
Direction of flow
Input or output from the process
Activity
Beginning or end of the process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Standard sandwich process
Raw materials
Assembly Stored sandwiches
Move to outlets
Stored sandwiches
Customer request
SellTake
payment
Customized sandwich – old process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Raw materials
Take payment
Customized sandwich – old process
Customer request
Assembly
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
The operation of making and selling customized sandwiches
Outline process of making and selling customized sandwiches
PrepareAssemble as
requiredTake
payment
Bread and base filling
Stored ‘bases’
Fillings
Assemble whole sandwich
Customer request
Use standard ‘base’?
Assemble from standard ‘base’
No
Yes
Detailed process of assembling customized
sandwiches
Sandwich materials and
customers
Customers ‘assembled’ to
sandwiches
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Bread and base filling
Assembly of ‘sandwich
bases’
Assemble from standard ‘base’
Take payment
Assemble whole sandwich
Customer request
Use standard ‘base’?
No
Yes
Fillings
Stored ‘bases’
Customized sandwich – new process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Reports to batch control
Reports filed Payment voucher to keying
Confirm payment
Report arrives
Stamp and date report
Check expenses report
Wait for processingCheck reports and vouchers
Attach payment voucher
Collect retorts into batch
Batch control number
Batch to audit desk
Wait for batching
Copy of reports to filing
Description of activity
Totals
8
1
2
4
5
6
7
9
10
3
11
12
14
15
13
5 5 2 2 1
Send to accounts receivable
Reports to batch control
Reports filed
Confirm payment
Report arrives
Stamp and date report
Send cash to receipt desk
Wait for processing
Check expenses report
Wait for processing
Check employee record
Check advance payment
Send to account payable
Wait for processing
Attach payment voucher
Collect retorts into batch
Check against rules
Wait for processing
Batch control number
Check payment voucher
Log report
Batch to audit desk
Wait for batching
Batch of reports logged
Copy of reports to filing
Description of activity
Totals
8
1
2
4
5
6
7
9
10
3
18
11
12
14
15
16
17
19
20
13
26
2223
24
25
21
7 8 5 5 1
Payment voucher to keying
Flow process charts for processing expense reports at Intel before and after improving the process
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Throughput (TH) = Work in process (WIP) × Cycle time (CT)
Little’s law (a really quite useful law)
Cycle time = 2 minutes
Throughput time = ?
WIP = 10
Throughput time = 10 × 2 minutes = 20 minutes
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Throughput (TH) = Work in process (WIP) × Cycle time (CT)
Little’s law (a really quite useful law)
Throughput time = 5 days × 7 hours = 35 hours
500 exam scripts need to be marked in 5 days (working 7 hours a day).It takes 1 hour to mark a script. How many markers are needed?
35 hours = 500 scripts × Cycle time
Cycle time = 35 hours500 scripts
= 0.07 hours
Number of markers = Work content = 1 hour = 14.29Cycle time 0.07
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Throughput efficiency = Work content
Throughput time × 100
Throughput efficiency is the work content of whatever is being processed as a percentage of its throughput time
Throughput efficiency
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
0 20% 40% 60% 80% 100%
Capacity utilization
Low
X
X
X
High utilization but long throughput times
Low utilization but short throughput times
Reduce process variability
High
10 mins
30 mins
Arrival frequency (demand)
Processing time
Utilization = 33.33 % Q = 0A
vera
ge
len
gth
of
qu
eue
X
Utilization = 50 % Q = 0
20 mins
X
10 mins
Utilization = 100 % Q = 0X
Utilization = 100 % Q = infinity
9 mins
X
5–15 mins
5–15 mins
Arrival frequency (demand)
Processing time
Utilization < 100% Q > 0
Pro
cess
th
rou
gh
pu
t ti
me
(or
inve
nto
ry)
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
10 20 30 40 50 60 70 80 90 1000Utilization
Ave
rage
num
ber
of u
nits
w
aitin
g to
be
proc
esse
d
Decreasing variability
10 20 30 40 50 60 70 80 90 1000Utilization
Ave
rage
num
ber
of u
nits
w
aitin
g to
be
proc
esse
d
X
Y Z
High utilization but long waiting
time
Reduction in process
variabilityShort waiting time but low
utilization
(a) Decreasing variability allows higher utilization without long waiting times
(b) Managing process capacity and/or variability
The relationship between process utilization and number of units waiting to be processed for variable arrival and
activity times
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms Test
Throughput timeThe time for a unit to move through a process.
UtilizationThe ratio of the actual output from a process or facility to its
design capacity.
Life cycle analysisA technique that analyzes all the production inputs, the life
cycle use of a product and its final disposal in terms of total energy used and wastes emitted.
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms Test
Process typesTerms that are used to describe a particular general approach to
managing processes. In manufacturing these are generally held to be project, jobbing, batch, mass and continuous processes; in services they are held to be professional services, service shops and mass services.
Project processesProcesses that deal with discrete, usually highly customized,
products.
Jobbing processesProcesses that deal with high variety and low volumes, although
there may be some repetition of flow and activities.
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms TestBatch processesProcesses that treat batches of products together, and where
each batch has its own process route.
Continuous processesProcesses that are high volume and low variety; usually products
made on continuous processes are produced in an endless flow, such as petrochemicals or electricity.
Professional servicesService processes that are devoted to producing knowledge-
based or advice-based services, usually involving high customer contact and high customization. Examples include management consultants, lawyers, architects, etc.
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms TestService shopsService processes that are positioned between professional
services and mass services, usually with medium levels of volume and customization.
Mass servicesService processes that have a high number of transactions, often
involving limited customization, for example mass transportation services, call centres, etc.
Product–process matrixA model derived by Hayes and Wheelwright that demonstrates the
natural fit between volume and variety of products and services produced by an operation on one hand, and the process type used to produce products and services on the other.
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms TestProcess mappingDescribing processes in terms of how the activities within the
process relate to each other (may also be called process blueprinting or process analysis).
Process mapping symbolsThe symbols that are used to classify different types of activity,
usually derived either from scientific management or from information systems flowcharting.
High-level process mappingAn aggregated process map that shows broad activities rather
than detailed activities (sometimes called an outline process map).
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms Test
Work contentThe total amount of work required to produce a unit of
output, usually measured in standard times.
Throughput timeThe time for a unit to move through a process.
Cycle timeThe average time between units of output emerging from a
process.
Slack, Chambers and Johnston, Operations Management 5th Edition © Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Key Terms Test
Work-in-process
The number of units within a process waiting to be processed further (also called work-in-progress).
Little’s Law
The mathematical relationship between throughput time, work-in-process and cycle time:
Throughput time = work-in-process × cycle time