PRESENTATION
ON
PROCESS
STRATEGY
PRESENTED BY
Hira Islam ID:B3160B01
Tuhin Parves 6
Miad Hossain ID:B3160B00
Prince 5
Farah Amira Khan ID:B3160B02
Anoare Hossain 2
ID:B3160B02
5
ID:B3160B03
6
Process Strategies
Process strategy Involves determining how to produce a good or
provide a service within constraints
• Objective
• Meet or exceed customer requirements
• Meet cost & managerial goals
Effect
• Production efficiency
• Product & volume flexibility
• Cost & quality
.
.
Process-Focused Strategy
• Facilities are organized by process
• Similar processes are together
Example: All drill presses are together
• Low volume, high variety products
• ‘Jumbled’ flow
• Other names
Job shop
Example
Process-Focus Examples
Process Focus - Pros & Cons
Advantages
• Greater product flexibility
• More general purpose equipment – equipments not dedicated to one product
Disadvantages
• High production cost per unit
• More difficult production planning & control
• Low equipment utilization (5% to 25%)
Repetitive Focused Strategy
• Facilities often organized by assembly lines
• Characterized by modules
Parts & assemblies made in modules
• Modules combined for many output options
• Other names
Assembly line
Production line
E.g. auto-manufacturing, pc’s, house-hold appliances, etc
Repetitive Focus - Examples
Example
Product-Focused Strategy
• Facilities are organized by product
• High volume, low variety
• Conversion or further processing of undifferentiated
materials such as petroleum, chemicals, or beer
• Follows a predetermined sequence of steps, but flow is
continuous rather than discrete – highly standardized
• Other names
• Line flow production
• Continuous production
Production Process at NUCOR Steel
Product Focus - Pros & Cons
Advantages
• Lower production cost per unit
• Lower but more specialized labor skills
• Easier production planning and control
• Higher equipment utilization (70% to 90%)
Disadvantages
• Lower product flexibility
• More specialized equipment
Mass Customization
• Using technology and imagination to rapidly mass-produce products
that cater to unique customer desires
• Under mass customization the three process models become so
flexible that distinctions between them blur, making variety and
volume issues less significant
EXAMPLE
Comparison of Processes
Process Focus Repetitive Focus Product Focus Mass
(Low volume, (Modular) (High-volume, Customization
high variety) low-variety) (High-volume,
high-variety)
Small quantity, Long runs, Large quantity, Large quantity,
large variety of standardized small variety of large variety of
products product made products products
from modules
General purpose Special Special purpose Rapid
equipment equipment aids equipment changeover on
in use of flexible
assembly line equipment
Comparison of Processes(contd)
Process Focus Repetitive Focus Product Focus Mass
(Low volume, (Modular) (High-volume, low- Customization
high variety) variety) (High-volume,
high-variety)
Operators are Employees are Operators are less Flexible operators
broadly skilled modestly trained broadly skilled are trained for the
necessary
customization
Many job Repetition Few work orders Custom orders
instructions as reduces training and job require many job
each job changes and changes in instructions instructions
job instructions because jobs
standardized
Comparison of Processes(Contd)
Process Focus Repetitive Focus Product Focus Mass
(Low volume, high (Modular) (High-volume, low- Customization
variety) variety) (High-volume,
high-variety)
Raw material JIT procurement Raw material Raw material
inventories high techniques used inventories are low inventories are low
Work-in-process is JIT inventory Work-in-process Work-in-process
high techniques used inventory is low inventory driven
down by JIT, lean
production
Comparison of Processes
Process Focus Repetitive Focus Product Focus Mass Customization
(Low volume, high (Modular) (High-volume, low- (High-volume, high-
variety) variety) variety)
Units move slowly Movement is Swift movement of Goods move swiftly
through the plant measured in hours unit through the through the facility
and days facility is typical
Finished goods Finished goods Finished goods Finished goods often
made to order made to frequent made to forecast and made to order
forecast stored
Crossover Charts
Variable A chart of costs at the
costs possible volumes for
Variable Variable
$ costs
$ costs $ more than one process.
The comparison of
Fixed costs processes can be further
Fixed costs
Fixed costs enhanced by looking at
Low volume, high variety
Repetitive High volume, low variety the point where the
Process B Process C
Process A total cost of the process
$ changes.
st
co
st
ta l st
l co
co
To Tota
tal
To
Product A
Product B
Product C
Fixed cost Fixed cost Fixed cost
Process A Process B Process C
V1 V2
Volume
Total Dollars required per
Fixed cost accounting report
Software A 200,000 60
Software B 300,000 25
Software C 400,000 10
Approach: Solve for the crossover point for software A and B and then the crossover
point for Software B and C.
Solution: A 200,000 60
B 300,000 25
For V1, C 400,000 10
200,000+(60)v1 = 300,000+(25)v1
35v1 = 100,000
v1 = 2,857
For V2,
300,000+(25)v2 = 400,000+ (10)v2
15v2 = 100,000
v2 = 6,666
Changing Processes
Difficult and expensive
May mean starting over
Process strategy determines
transformation strategy for an
extended period
Important to get it right
Flow Diagrams
Time Function Mapping
A B
Service Blueprinting
The service blueprint is a technique originally used for service design and innovation, but has
also found applications in diagnosing problems with operational efficiency.
Process
Service Points of Contact
Blueprinting
Evidence
Process Charts
To understand.
To study
To communicate.
To document a process.
When planning a project.
Operation
Inspection
Transport
Storage
Delay
The Service Process Design
We can define the service process as the way in which a company works so that a customer
receives service.
1. Line operations.
2. Job Shop Operations.
3. Intermittent Operations.
Customer Interaction & Process Design
Degree of Customization
Low High
Mass Professional
High Service Service
Degree of Labor
Service Service
Low Factory Shop
• Production Technology
• Process Redesign
• Ethics and environmentally
friendly process
Production Technology
• Advances in technology that enhance production
and productivity have a wide range of
applications in both manufacturing and services.
9 Areas of technology
1. Machine technology
2. Automatic Identification Systems (AIS) and RFID
3. Process control
4. Vision system
5. Robots
6. Automated storage and retrieval systems
(ASRSs)
7. Automated guided vehicles
8. Flexible manufacturing systems (FMSs)
9. Computer integrated manufacturing (CIM)
Machine
technology
A machine is a tool containing one or more parts
that uses energy to perform an intended action.
Machines are usually powered by mechanical,
chemical, thermal, or electrical means, and are
often motorized.
• Perform operations
such as_
Cutting , Drilling,
Boring, Milling.
• 21st – five times
more productive
CNC
_Computer
numerical
The machinery with its own computer and memory.
control
Automatic Identification Systems (AIS)
&RFID
AIS
A system for transforming data into
electronic form.
For example , Bar codes.
RFID
Radio-frequency identification (RFID) uses
electromagnetic fields to automatically identify and track
tags attached to objects. The tags contain electronically
stored information. Passive tags collect energy from a
nearby RFID reader's interrogating radio waves.
Process control
The use of information technology to
monitor and control a physical process.
Used to determine and
control
temperatures ,pressur
es , quantities in
petroleum refineries ,
petrochemical process
, cement plants ,
nuclear reactors and
other product -focused
facilities.
Vision system
Systems that use
video cameras and
computer technology
in inspection roles.
Food –processing
and manufacturing
organizations.
Robots
A flexible machine with
the ability of hold , move
or grab items .
It functions through
electronic impulses that
activate motors and
switches.
Monotonous or
dangerous
The substitution of
mechanical for human
efforts.
Automated storage and retrieval
systems (ASRSs)
Computer-controlled warehouses that
provide for the automatic placement
of parts into and from designated
places within a warehouse.
Automated guided vehicles (AGVs)
Electronically guided and
controlled cart used to move
materials.
Flexible manufacturing systems
(FMSs )
A system that uses an automated work cell
controlled by electronic signals from a
common centralized computer facility.
Computer integrated manufacturing
(CIM)
CIM is a manufacturing system which
includes computer-aided design(CAD),
computer-aided manufacturing (CAM),
flexible manufacturing systems (FMSs),
Automated storage and retrieval
systems (ASRSs), automated guided
vehicles (AGVs), and robots to provide
an integrated and flexible
manufacturing process.
Process Redesign
The fundamental rethinking of business
processes to bring about dramatic
improvements in performance.
Technology’s Impact on Services
Debit cards , electronic fund
transfer, automatic teller
machine(ATM), internet stock
Financial Services: trading.
Online newspaper , online
journals , interactive assignments
via Web CT and Blackboard.
Education
Automated one-man garbage
trucks, optical mail and bomb
scanners, flood warning
Utilities and government systems.
Wireless orders from waiters to the
kitchen, robot butchering,
transponders on cars that track
Restaurants and foods sales at drive- through.
Electronic publishing, interactive
TV
Communications
Electronic check-in/check-out,
electronic key/lock
System.
Hotels
Use of ATM-like kiosks , Point-of-
sale (POS) terminals, e-commerce,
electronic communication between
Wholesale/Retail trade store and supplier, bar coded data.
Automatic toll booths, satellite-
directed navigation systems.
Transportation
Online patient-monitoring,
online medical information
systems, robotic surgery.
Health care
Ticketless travel, scheduling,
Internet purchases.
Airlines
Ethics & environmentally
friendly processes
• Activities that society perceives as ethical and
socially responsible to actions that are legally
required –such as pollution prevention.
Efficient use of resources ,
reduction of waste by-products ,
emission controls and recycling.
British cosmetic
Effective operations managers understand how
to use process strategy as a competitive
weapon.
