Module-2: Process Selection & Supply Chain

Design

Mod: 2-2

Processes & Technologies

Learning Outcomes
After going through this topic, you should
be able to:
Explain how manufacturing processes run
Suggest appropriate technologies for different stages of
manufacturing process
Identify and classify the wastes of a production uni
Represent processes in a digital manufacturing environment

Operations strategy: Improve Speed to Market

Simultaneous (Concurrent) Engineering

Product/
Service Ideas
Economic and Technical
Feasibility Studies

Product/Service Design

Continuous
Interaction

Production Process Design

Production and Marketing

New Product/Service

Process
Planning and Design

Process Planning and Design System

Process Planning & Design:

Process-Type Selection
Vertical Integration Studies
Process/Product Studies
Equipment Studies
Production Procedures Studies
Facilities Studies

Inputs:
Product/Service Information
Production System
Information
Operations Strategy

Outputs:
Process
Technology
Facilities
Personnel
Estimates

Some Production Processes

Metal-working Processes
Assembly

Casting & Molding

Cutting

Forming

Finishing

Brazing

Die casting

Broaching

Drawing

Blasting

Cementing

Sand casting

Drilling

Extrusion

Buffing

Fastening

Investment casting

Grinding

Punching

Cleaning

Press-fitting

Injection molding

Honing

Rolling

Deburring

Shrink-fitting

Powder-metal molding

Milling

Trimming

Heat treatment

Soldering

Permanent molding

Shaping

Swaging

Painting

Turning

Spinning

Polishing

Welding

Some Production Processes

Non-metal-working Processes
Chemical

Food Processing

Mining

Textiles

Lumber

Cracking

Canning

Drying

Braid

Debark

Cooking

Cooking

Crushing

Knit

Cure

Curing

Crushing

Excavation

Polish

Join

Distillation

Freezing

Extraction

Shrink

Kiln

Evaporation

Pasteurization

Loading

Spin

Plane

Grinding

Press

Screening

Wash

Saw

Screening

Sterilization

Smelting

Weave

Turn

Process Flow Design

A process flow design can be defined as a mapping of the

specific processes that raw materials, parts, and sub-assemblies
follow as they move through a plant

The most common tools to conduct a process flow

design include assembly drawings, assembly charts, and
operation and route sheets
Material
Received from
Supplier

Inspect
Material for
Defects

Defects
found?
Yes

Example: Process Flow Chart

Return to
Supplier for
Credit

No,
Continue

Example: Assembly Chart (Gozinto)

4
5
6
7

Lock ring
Spacer, detent spring
SA-2

Rivets (2)

A-2

Spring-detent
I-5
Component/Assy Operation
Inspection

OPERATIONS & ROUTE SHEET

Material specifications
Purchased stock size
Pieces per purchase
Weight

------------------------------------------

Part name ----Usage

----Assy. No.
----Sub Assy. No. ---

Part No.
------Date issued -------Date supplied -----Issued by
--------

Opr
No.

Operation Description

Dept

Machine

Setup
Hr.

Rate
Pc. Hr.

Tools

20

Drill hole .32+.015

Drill

M/c. 513
Drill

1.5

254

Drill fixture L-76

Jig # 10393

Drill

M/c. 510
Drill

.1

424

Multi-tooth burring tool

Lathe

M/c. D109
Lathe

1.0

44

Ramet-1, TPG 221, Chamfer

tool

-.005

30

Deburr .312+.015 dia. hole

-.005

40

Chamfer .009/875. bore.878/.875 dia.

(2 passes. bore. 7600/7625 (1 pass)

50

Tap hole as designed min. full thread

Tap

M/c. 517
Drill tap

2.0

180

Fixture # CR/353 tap. 4 flute

sp.

60

Bore hole 1.33 to 1.138 dia.

Lathe

H&H
E 107

3.0

158

L44 turret fixture Hartford

Superspacer, pl. # 45 holder #
L46
FDTW-100, insert#21
Chk.fixture

70

Deburr .005 to .010 both sides,

Lathe

E 162
Lathe

.3

175

Collect CR # 179 1327 RPM

B87 fixture, L59 broach tap. .
875120 G-H6

hand to hard stop

80

Broach keyway to remove thread burrs

Drill

M/c. 507
Drill

.4

91

90

Hone thread I.D. .822/.828

Grind

Grinder

1.5

120

95

Hone .7600/.7625

Grind

Grinder

1.5

120

Basic work flow structures

If the flow is of low volume, go for manual

process; and for high volume, go for automation.
The basic flow structures are:
1.Project layout (Fixed position layout, by virtue of its bulk or weight)
Example - Dam, Road, House, Film-location, Ship-building, Aircraft mfg.

2.Workcenter (where similar equipments are grouped for one kind of work)
groups of machines/equipments in a Job-shop/Functional/ Process/Group/ Batch
Layout; discrete product moves from one to another workcenter.
Example - Photocopy of a single students term paper; Bread-making.

3.Manufacturing cell (dedicated to products with similar processing needs).

A specific set of processes run in a cellular layout.
Example - Different units of a publication house.

Basic work flow structures

Contd.

4. Assembly Line (a fixed line or sequence of progressive operations)

discrete parts are made by moving from workstation to workstation in a
line/ product layout.
Example - Automobile manufacturing

5. Continuous process (like assembly line, but continuous and

integrated operations) with limited/no predetermined stops.
Example - Manufacturing of petroleum, steel, aluminum etc.

Product-Process

Matrix

Product-Process Matrix

Operation strategy dictates the type of processes to be selected

the equipment, building, layout, technology, people, skill etc.

Major Factors Affecting Process Designs

Nature of product/service demand

Degree of vertical integration (of process)

Make or Buy

Production flexibility

Scope for Expansion and Consolidation

Volume and Variety

Degree of automation
Product/Service quality

14

Types of Process Designs

Product-Focused

Production Line or Assembly Line

Job Shop or Intermittent Production
As per the operations sequence to produce a product or
provide a service
Discrete Units or Continuous Process

Process-Focused

Organizing Processes by similarities or groups

Products/Services (jobs) progress from department to
department as required
15

Product-Focused

Raw Material

ne
nt
s

Su
b

as
s

em
bl
y

1 Components 3 Subassembly 5

Assemblies

Purchased
Components,
Subassemblies

Finished
7 Goods
ies

om
po

se
mb
l

2
C

Components

As

Raw Material

Product/Material Flow
Production Operation

16

Process-Focused
Custom Woodworking Shop

Job A

Cutting Planning Shaping Assembly Sanding Finishing

3
Job B

4
Drilling Turning

Product/Material Flow
Production Operation

17

Process Reengineering

Drastically changing the process from the existing state

Truly reengineered processes are more efficient

18

Deciding a Process from Alternatives

Batch

Size and Product/Service Variety

Capital

Requirements

Economic
Cost

Analysis

Functions of Alternative Processes

Break-Even
Financial

Analysis

Analysis
19

Product
Focused,
Dedicated
Systems
Product
Focused,
Batch
System
Cellular
Manufacturing Process-Focused,
Job Shop

Small

Batch Size

Large

Process Design Depends

on Product Diversity and Batch Size

Few

Number of Product Designs

Many

20

Economic Analysis

Cost Functions of Processing Alternatives

Fixed Costs
Annual cost when production volume is zero
Initial cost of buildings, equipment, and other
fixed assets
Variable Costs
Costs that vary with production volumes
Labor, material, and variable overhead

21

Break-Even Analysis (to select a process/equipment based on cost-trade-offs)

Rs.

The total revenue and total

cost are equal at BEP.

BEP

BEC

Margin of Safety

Fixed cost

A model determines the breakeven-point (BEP) of units

produced (and sold) where
onwards the process or
equipment goes in profit

Variable cost

A standard approach to
choose a process or
equipment

Loss

BEQ

Nos.

Break-Even Analysis (Continued)

Break-even
Break-even Demand
Demand ==
Purchase
Purchase cost
cost of
of process
process or
orequipment
equipment
Price
Price per
perunit
unit -- Cost
Cost per
perunit
unit

* This formula can be used to find any of its components

algebraically if the other known parameters

Break-Even Analysis (Continued)

Example:
Example:
Suppose
Supposeyou
youwant
wantto
topurchase
purchaseaanew
newcomputer
computerthat
thatwill
willcost
cost$5,000.
$5,000.
ItItwill
willbe
beused
usedto
toprocess
processwritten
writtenorders
ordersfrom
fromcustomers
customerswho
whowill
willpay
pay
$25
$25each
eachfor
forthe
theservice.
service. The
Thecost
costof
oflabor,
labor,electricity
electricityand
andthe
theform
form
used
usedto
toplace
placethe
theorder
orderisis$5
$5per
percustomer.
customer. How
Howmany
manycustomers
customerswill
will
we
weneed
needto
toserve
serveto
topermit
permitthe
thetotal
totalrevenue
revenueto
tobreak-even
break-evenwith
withour
our
costs?
costs?

Answer:
Answer: Break-even
Break-evenDemand:
Demand:
== Total
Totalfixed
fixedcosts
costsof
ofprocess
process or
orequip.
equip.
Unit
Unitprice
priceto
tocustomer
customer Variable
Variablecosts
costs
== 5,000/(25-5)
5,000/(25-5)

Example: Economic Analysis at Valley Hospital

Valley Hospital is planning to install a new linen retrieval
system. Two alternatives being considered are: a continuous
vacuum (CV) system and a batch robotic/chute (BR/C)
system. The following estimates were prepared:
CV BR/C
Annual Fixed Costs ($000)
$2,690
$975
Average Variable Cost per Ton $1,660 $2,590
At a forecast annual operating level of 2,000 tons of linen,
which alternative should be chosen based only on total
annual cost?
25

Solution:
TCCV = 2,690,000 + 1,660(2,000) = $6,010,000
TCBR/C = 975,000 + 2,590(2,000) = $6,155,000
The continuous vacuum (CV) alternative has a lower total
annual cost.
The annual volume of linen has to increase or decrease to
what level in order for the BR/C alternative to be favored?
TCCV = TCBR/C
2,690,000 + 1,660(Q) = 975,000 + 2,590(Q)
830Q = 1,715,000
Q = 1,844.1 tons
Annual volume must decrease to 1,844 tons or less.

26

Economic Analysis

Break-Even Analysis
Widely used to analyze and compare decision
alternatives
Can be displayed either algebraically or graphically

Disadvantages:
Cannot incorporate uncertainty
Costs assumed over entire range of values
Does not take into account time value of money

27

Break-Even Analysis

Example
Break-Even Points of Processes A, B, and C,
assuming a $6.95 selling price per unit
Q = FC / (p-v)
A: Q = 120,000 / (6.95 - 3.00) = 30,380 units
B: Q = 90,000 / (6.95 - 4.00) = 30,509 units
C: Q = 80,000 / (6.95 - 4.50) = 32,654 units
Process A has the lowest break-even point.
28

Economic Analysis

Financial Analysis
Huge investment is done in production processes and
these assets are expected to last a long time
Therefore, time value of money is important

Payback period
Net present value
Internal rate of return
Profitability index
29

Deciding Among Processing Alternatives

Assembly Charts (Gozinto Charts)

Macro-view of how materials are united
Starting point to understand factory layout needs,
equipment needs, training needs

Process Charts
Details of how to build product at each process
Includes materials needed, types of processes
product flows through, time it takes to process
product through each step of flow

30

Wrap-Up: World Class Practice

Fast new product introduction

Design products for ease of production
Refine forecasting
Focus on core competencies ... less vertical
integration
Lean production
Flexible automation
Job shops move toward cellular manufacturing
Manage information flow ..... automate and simplify!
31

Question Bowl

What is the break-even in demand for a new

process that costs $25,000 to install, will
generate a service product that customers are
willing to pay $500 per unit for, and whose
labor and material costs for each unit is $100?
a. 400 units
b. 250 units
c. 100 units
d. 62.5 units
e. None of the above

d. 62.5 units
i.e. 25,000/(500-100) = 62.5

Answer:

Question Bowl

Which of the following is an example

of a Continuous Flow type of process
flow structure?
a.
b.
c.
d.
e.

Fast food
Grocery
Hospitals
Chemical company
None of the above

Answer: d. Chemical company (in Process Industry)

PROCESS TECHNOLOGIES
Recent growth in productivity comes from the
application of Operations technology.
In manufacturing it comes from Soft (information)
Technologies and Hard (machine) Technologies.
So we need to study:
Hardware Systems
Software Systems
Evaluating a Robot Investment
Computer Integrated Manufacturing
Benefits & Risks

Hardware
Systems

Numerically controlled (NC) machines

Have Adaptive controls to receive/read instructions and
translate them into machine operations
CNC computer numerically controlled
DNC direct numerically controlled (several machines
controlled by a single computer)

Industrial robots
Human-like machines performing production tasks, controlled
by a microcomputer, have grippers (vacuum, magnetized,
adhesive), Equipped with an end effectors to pick, grip, hold)
sensors (tactile, proximity, vision/optical); can operate in
environments hostile to humans (heat, noise, dust, darkness,
skin irritants, )
Perform precisely and repeatedly without fatigue
Weld, assemble, paint, inspect, transport, ..
Automated Inspection, Quality control, Material handling

Automated material handling (AMH) systems

Computerized conveyors, AS/RS (load/pick/place), AGVS

FMS Manufacturing Cells, Robots, Machining Centers, ...

Flexible Manufacturing System (FMS)

Pallet
Transfer
System
Workpiece
in queue

X
X
X

Parts

Machine 2

Tools

X
X

Machine 1

Tools

X
X

Pallet with
workpiece X
attached

Load

Tools

Computer

Machine 3

Unload

Worker
36

Group Technology/Cellular Manufacturing

Group Technology
Each part produced receives a multi-digit code that
describes the physical characteristics of the part.
Parts with similar characteristics are grouped into
part families
Parts in a part family are typically made on the
same machines with similar tooling

37

Group Technology/Cellular Manufacturing

Cellular Manufacturing
Some part families (those requiring significant
batch sizes) can be assigned to manufacturing
cells.
The organization of the shop floor into cells is
referred to as cellular manufacturing.
Flow of parts within cells tend to be more like
product-focused systems

38

Group Technology/Cellular Manufacturing

Advantages (relative to a job shop)

Process changeovers simplified
Variability of tasks reduced (less training needed)
More direct routes through the system
Quality control is improved
Production planning and control simpler
Automation simpler

39

Group Technology/Cellular Manufacturing

Disadvantages
Duplication of equipment
Under-utilization of facilities
Processing of items that do not fit into a family
may be inefficient

40

Group Technology/Cellular Manufacturing

Candidates for GT/CM are job shops having:

A degree of parts standardization
Moderate batch sizes

41

Software
Systems

Automated manufacturing planning and control

systems (MP & CS)
Enterprise Resource Planning (ERP)
Computer-aided-design (CAD)
Computer-aided engineering (CAE)
Computer-aided process planning (CAPP)
Computer-integrated manufacturing (CIM)

ASRS
Automated
Assembly

CAD/CAM

Process
Controls
GT
Systems
MRP II

Evaluating a Robot Investment

The payback formula for an investment in robots is:

I
P
L - E q(L Z)
Where
P = Payback period in years
I = Total capital investment required in robot and accessories
L = Annual labor costs replaced by the robot (wage and
benefit costs per worker times the number of shifts per day)
E = Annual maintenance cost for the robot
Z = Annual depreciation
q = Fractional speedup (or slowdown) factor (in decimals).
Example: If robot produces 150 % of what the normal worker is
capable of doing, the fractional speedup factor is 1.5.

Example: Evaluating a Robot Investment

Suppose a company wants to buy a robot. The bank

wants to know what the payback period is before they will
lend them the $120,000 the robot will cost. You have
determined that the robot will replace one worker per shift,
for a one shift operation. The annual savings per worker
is $35,000. The annual maintenance cost for the robot is
estimated at $5,000, with an annual depreciation of
$12,000. The estimated productivity of the robot over the
typical worker is 110%. What is the payback period of this
robot?

P=

I
=
120,000
= 1.47years
LE+q(L + Z) 35,0005,000+1.1(35,000+12,000)

Computer Integrated Manufacturing (CIM)

Product and process design

CAD and CAM

Planning and control

CAPP and MP&CS

The manufacturing process

Cost Reduction Benefits from Adopting New Technologies

Labor costs
Material costs
Inventory costs
Transportation or distribution costs
Quality costs
Other costs

Other Benefits.

Increased product variety

Improved product features
and quality
Shorter cycle times

Risks

Technological risks
Organizational risks
Environmental risks
Market risks

References :
1.

Operations & Supply Management; Chase, Shankar, Jacobs

and Aquilano; 12th Ed.; TMH Publication.

2.

Operations Management; Gaither, N. and Frazier, G.;

Cengage Learning, 9th Edition.

End of Chapter