OPERATIONS MANAGEMENT UNIT - II

UNIT- II

PRODUCT DEVELOPMENT ORGANISATIONS IN A SECTOR OF AN INDUSTRY THAT OFFER A HOMOGENOUS SET OF PRODUCTS AND SERVICES HAVE VERY LITTLE OPPORTUNITY FOR VALUE CREATION. THE NOTION OF CREATING VALUE THROUGH INNOVATION HAS BEEN WELL ARTICULATED BY RESEARCHERS AND DEMONSTRATED BY SUCCESSFUL COMPANIES. INNOVATION CREATES DISEQUILIBRIUM IN THE MARKET AND PAVES THE WAY FOR NEW VALUE-CREATION OPPORTUNITIES. OM ADDRESSES THE ISSUE OF INNOVATION BY ENABLING ORGANIZATIONS TO BRING IN SOME DISTINCTIVENESS IN THEIR OFFERINGS. THE DISTINCTIVENESS MAY BE ON ACCOUNT OF THE PRODUCT OR SERVICE IT OFFERS, THE TECHNOLOGY IT EMPLOYS, OR THE PROCESSES IT USES TO PROVIDE THE PRODUCT OR SERVICE TO THE CUSTOMER. THE PRODUCT DEVELOPMENT PROCESS PROVIDES A BROAD SET OF TOOLS, TECHNIQUES, AND CONCEPTS THAT ENABLE AN ORGANIZATION TO PROVIDE DISTINCTIVENESS IN ITS OFFERINGS BY ROLLING OUT NEW PRODUCTS AND SERVICES FASTER AT A LOWER COST.

UNIT- II

STAGES IN THE PRODUCT DEVELOPMENT PROCESS : 1.CONCEPT GENERATION 2.DESIGN 3.DEVELOPMENT 4.PRODUCTION

UNIT- II Concept Generation

Idea generation Feasibility study

Design
Preliminary design Process planning Cost planning

Yes
Product Feasible ?

No

Production
Final design and Manufacturing specification Commercial production

No

Design OK?

Yes

Yes

Prototype OK?

Prototype developing and testing

No Fig.6.1 A typical product development process

Development

UNIT- II CONCURRENT ENGINEERING PRODUCT DEVELOPMENT IS AN INTERDISCIPLINARY EFFORT. SO, AN APPROPRIATE ORGANIZATION STRUCTURE IS ESSENTIAL FOR A GOOD PRODUCT DEVELOPMENT PROCESS. TRADITIONALLY, THE ORGANIZATIONAL STRUCTURE FOR THE PRODUCT DEVELOPMENT PROCESS WAS SUCH THAT EACH FUNCTIONAL AREA PERFORMED ITS SCOPE OF WORK IN THE PRODUCT DEVELOPMENT PROCESS IN ISOLATION. MOREOVER, THE FUNCTIONAL AREAS ADDRESSED THE PRODUCT DEVELOPMENT PROCESS ONE AT A TIME. AFTER ONE GROUP COMPLETED ITS SCOPE OF WORK, IT WAS PASSED ON TO ANOTHER GROUP FOR FURTHER PROCESSING. IF THERE WERE INFEASIBILITIES, THE PROCESS WAS REVERSED AND THE PART WAS SENT BACK TO THE EARLIER DEPARTMENT. FIG.6.3(a) DEPICTS THIS ARRANGEMENT. SUCH AN APPROACH CREATED LONG LEAD TIME FOR PRODUCT DEVELOPMENT WHICH CREATED SEVERAL PROBLEMS FOR THE ORGANIZATION. MOST PROMINENT AMONG THE PROBLEMS IS THAT SEVERAL ASSUMPTIONS ABOUT THE MARKET, PRICING, AND COMPETING PRODUCTS MAY HAVE BEEN WRONG. FOR EXAMPLE, IF AN ORGANIZATION TAKES 48 MONTHS TO DEVELOP AND BRING A PRODUCT TO THE MARKET, BY THE TIME THE PRODUCT IS INTRODUCED, ITS ASSUMPTIONS ABOUT THE COMPETITION MIGHT HAVE CHANGED SUBSTANTIALLY.

UNIT- II

Fig.6.3(a) Organizational structure for a product development process : Traditional approach

Customers Suppliers

Marketing

Design

Planning

Procurement

Production

Finance

Customers
Marketing

Planning

Procurement
Production

Concurrent engineering team structure

Design

Suppliers

Finance

Fig.6.3(b) Concurrent Engg.

UNIT- II SECOND ISSUE IS THE COST OF DEVELOPMENT. A LONGER PROCESS WOULD CLEARLY MEAN GREATER DEVELOPMENT COSTS. SINCE THESE COSTS ARE SUNK EVEN BEFORE THE FIRST COMMERCIAL VERSION OF THE PRODUCT ROLLS OUT OF MANUFACTURING PLANT, IT PUTS ENORMOUS PRESSURE ON THE MARKETING AND PRODUCTION FUNCTIONS. IN RECENT TIMES, SIGNIFICANT CHANGES HAVE BEEN INTRODUCED IN THE ORGANIZATIONAL STRUCTURE FOR CREATING A PRODUCT DEVELOPMENT PROCESS THAT PROMISES A DRAMATIC IMPROVEMENT IN THE DEVELOPMENT LEAD TIME. FIG.6.3(b) SHOWS AN ALTERNATIVE APPROACH KNOWN AS CONCURRENT ENGINEERING. THE BASIC IDEA BEHIND THIS IS TO PUT TOGETHER A TEAM OF CROSS-FUNCTIONAL PROFESSIONALS AND PROVIDE THEM WITH THE NECESSARY RESOURCES AND MANDATE FOR THE PRODUCT DEVELOPMENT PROCESS. THE CROSS-FUNCTIONAL TEAM WORKS IN PROJECT MODE. ONCE THE PROCESS IS OVER, THE TEAM IS DISMANTLED AND THE MEMBERS RETURN TO THEIR PARENT FUNCTIONAL UNITS. BY CO-LOCATING VARIOUS FUNCTIONAL REQUIREMENTS FOR THE PRODUCT DEVELOPMENT PROCESS, ORGANIZATION COULD BENEFIT IN SEVERAL WAYS :

UNIT- II

THE DEVELOPMENT LEAD TIME COULD BE MORE THAN HALVED IN THIS PROCESS, ENABLING THE ORGANIZATION TO BRING NEW PRODUCTS INTO THE MARKET FASTER. IN THE LONG RUN, THIS WOULD HELP THE ORGANIZATION CAPTURE A GREATER MARKET SHARE. SINCE VARIOUS FUNCTIONAL REQUIREMENTS ARE SIMULTANEOUSLY AVAILABLE, THE NUMBER OF DESIGN CHANGES AFTER THE PRODUCT IS INTRODUCED INTO THE MARKET WILL COME DOWN. THIS IS BECAUSE THE TEAM MEMBERS WOULD HAVE HAD MORE OPPORTUNITIES TO ANALYSE THE IMPACT OF THE DESIGN FROM MULTIPLE PERSPECTIVES BEFORE APPROVAL. THEREFORE, DESIGN PRODUCTIVITY ALSO IMPROVES. A CONCURRENT APPROACH ENABLES ORGANIZATIONS TO INVOLVE ITS SUPPLIERS EARLY IN THE PRODUCT DEVLOPMENT PROCESS. THEREFORE, THE SUPPLIERS ARE ABLE TO CUT LEAD TIME FOR CAPACITY AUGMENTATION AND CAPABILITY BUILDING WITH RESPECT TO THE NEW PRODUCT BEING DEVELOPED. A TEAM STRUCTURE PROMOTES CONSENSUS-BASED DECISION MAKING AND INCREASES THE PROPENSITY FOR TAKING COLLECTIVE RISK.

UNIT- II
TOOLS AND APPROACHES IN PRODUCT DEVELOPMENT UNDERSTANDING CUSTOMER NEEDS THE FIRST STEP IN PRODUCT DEVELOPMENT PROCESS IS TO KNOW WHAT EXACTLY THE NEW PRODUCT IS GOING TO BE. THE CONCEPT GENERATION PHASE OF PRODUCT DEVELOPMENT PROCESS ADDRESSES THIS. THERE ARE VARIOUS METHODS : MARKET RESEARCH 1. ORGANIZATIONS USE A SET OF TOOLS FOR SOLICITING INFORMATIONS. ORGANIZATION MAY APPOINT A MARKET RESEARCH ORGANIZATION. A TARGET GROUP IS IDENTIFIED AND THE GROUP IS INTERVIEWED WITH THE HELP OF SET QUESTIONNAIRE. THE INFORMATION COLLECTED ARE SUBJECTED TO STATISTICAL AND ANALYTICAL REASONING BEFORE ARRIVING AT CUSTOMERs PREFERENCES AND NEEDS. 2. AN ALTERNATIVE METHOD IS TO USE FOCUS GROUPS. UNLIKE THE EARLIER METHOD, IN A FOCUS GROUP SEVERAL INDIVIDUALS FROM THE TARGET GROUP ARE SIMULTANEOUSLY MET AND INTERVIEWED TOGETHER. THE ADDITIONAL ADVANTAGE IS THE REINFORCEMENT OF CERTAIN IDEAS AND NEEDS THROUGH COLLECTIVE REASONING AND GROUP-BEHAVIOUR NORMS. 3. THE OTHER OPTION IS TO CONDUCT AN IN-DEPTH QUALITATIVE INTERVIEW WITH A SELECTED SET OF POTENTIAL CUSTOMERS ON AN INDIVIDUAL BASIS.IN THIS APPROACH, A CONSIDERABLE AMOUNT OF QUALITATIVE INFORMATION IS COLLECTED FROM A CHOSEN FEW. THE DATA COLLECTED IN THE ABOVE MANNER IS SUBJECTED TO EXTENSIVE ANALYSIS.

UNIT- II

Fig. 6.4 UNDERSTANDING CUSTOMER NEEDS

MARKET RESEARCH

QUANTITATIVE ANALYSIS Statistical Analysis Hypothesis testing

Focus Group QUALITATIVE ANALYSIS Reproduce customers own word Translate

In-depth qualitative interviews

Hierarchy of customer needs

Create bundles of customer attributes

UNIT- II COMPETITOR ANALYSIS AN UNDERSTANDING OF WHAT THE EXISTING OFFERINGS ARE AND HOW THE GAPS AND PROBLEMS IDENTIFIED CAN BE ELIMINATED CAN OFFER VALUABLE INPUTS TO CONCEPT GENERATION. THIS METHOD IS A PROXY FOR UNDERSTANDING CUSTOMERS NEEDS. ONE METHOD OF COMPETITOR ANALYSIS IS REVERSE ENGINEERING THE PRODUCT. IN REVERSE ENGINEERING, THE COMPETITORs PRODUCTS ARE DISMENTLED DOWN TO THE LEVEL OF INDIVIDUAL COMPONENTS AND SOME DETAILED STUDIES ARE CONDUCTED ON THEM. THESE MAY SOMETIMES REVEAL THE PROBABLE PROCESSES UTILIZED IN THEIR MANUFACTURE, THE CHOICE OF MATERIALS AND THEIR SPECIFICATIONS, AND THE RELATIONSHIP BETWEEN THESE PARAMETERS AND PERFORMANCE. IN THE CASE OF BENCHMARKING, THE COMPETITIVE PRODUCT OFFERINGS ARE CHOSEN FOR A DETAILED ANALYSIS. SPECIFIC PARAMETERS ARE CHOSEN FOR THE BENCHMARKING EXERCISE. FOR EXAMPLE, COST, FEATURES, PERFORMANCE, EASE OF MAINTEMANCE, EASE OF MANUFACTURE, ASSEMBLY, AND DISTRIBUTION ARE SOME OF THE ISSUES ON WHICH A COMPARATIVE STUDY MAY BE POSSIBLE. ONCE THE PARAMETERS ARE IDENTIFIED, DATA COLLECTION AND ANALYSIS WILL REVEAL THE POSITIONING OF ONEs OWN PRODUCT VIS--VIS THE COMPETITORs OFFERINGS.

UNIT- II

ANOTHER METHOD FOR COMPETITOR ANALYSIS IS TO DEVELOP PERCEPTUAL MAPS. PERCEPTUAL MAPS ARE GRAPHICAL REPRESENTATIONS OF THE VARIOUS COMPETITOR OFFERINGS AND THAT OF THE PROPOSED PRODUCT/SERVICE. QUALITY FUNCTION DEPLOYMENT (QFD) QUALITY FUNCTION DEPLOYMENT IS A TOOL THAT HELPS ORGANIZATIONS TO TRANSLATE CUSTOMER REQUIREMENTS INTO DESIGN, PROCESS PLANNING, AND MANUFACTURING SPECIFICATIONS USING A FOUR STAGE PROCESS. THE FIRST STAGE LINKS CUSTOMER NEEDS TO THE DESIGN ATTRIBUTES REQUIRED. IN THE SECOND STAGE, BASED ON THE DESIGN ATTRIBUTES, ACTIONS ARE TAKEN BY THE ORGANIZATION TO ACHIVE THESE ATTRIBUTES. THE ACTIONS IDENTIFIED IN SECOND STAGE ARE THE BASIS FOR THIS THIRD STAGE IN ARRIVING AT THE SPECIFIC DECISIONS TO BE IMPLEMENTED. FINALLY, IN THE FOURTH STAGE, THE IMPLEMENTATION DECISIONS DRIVE THE PROCESS PLANS TO BE DEPLOYED. EACH STAGE IS KNOWN AS HOUSE OF QUALITY Fig.6.5 is an illustration of the house of quality pertaining to the first stage. Fig.6.5(a) illustrates its use in case of a restaurant. Fig.6.5(b) is representative of the structure of a house of quality and the type of data used for analysis and decision making.

UNIT - II PERCEPTUAL MAP (Fuel consumptions of cars produced by different companies in same segment)
Fuel Consumption(Kms/Ltr)
14 12 10 8 6 4 2 0 A B C D Fuel Consumption(Kms/Ltr)

UNIT-II

PERCEPTUAL MAP (Capacity of cars produced by different companies in same segment)

Capacity(in CC)
E D C

Capacity(in CC)

B
A 0 500 1000 1500

UNIT- II

4.Trade-offs

2.Importance

3.Product characteristics

1.Customer requirements

5.Relationship matrix

6.Benchmarks

7.Technical assessment and target values

Fig.6.5(b) A generic representation of the house of quality

UNIT- II

21.1.13

SEVEN TYPES OF DATA ARE USED IN HOUSE OF QUALITY THE FIRST TYPE ARE THE CUSTOMER REQUIREMENT. WHEN SEVERAL SUCH REQUIREMENTS ARE IDENTIFIED, IT IS ALSO IMPORTANT TO KNOW IF SOME ARE MOST IMPORTANT THAN OTHERS. THE IMPORTANT DATA IS CAPTURED SUCH THAT IT HELPS THE DESIGN TEAM PRIOTITIZE ITS EFFORTS. THE NEXT KINDS OF INFORMATION REQUIRED ARE THE PRODUCT CHARACTERISTICS AND THE RELATIONSHIP BETWEEN CUSTOMER REQUIREMENT AND PRODUCT CHARACTERISTICS. THIS INFORMATION IS ALSO CAPTURED IN THE HOUSE OF QUALITY. IN CERTAIN CASES, THE CORRELATION CAN BE EITHER WEAK OR ZERO. IT CAN ALSO BE POSITIVE OR NEGATIVE. THESE TRADE-OFFS ARE ALSO CAPTURED IN THE HOUSE OF QUALITY. BEFORE FOCUSING ON DESIGN EFFORT, IT IS ALSO IMPORTANT TO BENCHMARK ONEs OWN PRODUCT OR PROPOSED SPECIFICATIONS WITH THAT OF THE COMPETITION. THE RIGHT SIDE OF HOUSE OF QUALITY PROVIDES INPUTS FROM THE BENCHMARKING EXERCISE. ONCE THE ABOVE INFORMATION IS COLLECTED AND ANALYZED, IT IS POSSIBLE TO FILL IN THE LOWER PORTION OF THE HOUSE OF QUALITY (ITEM NO.7). THE LOWER PORTION OF THE HOUSE OF QUALITY IS THE OUTPUT OF THIS STAGE OF THE EXERCISE AND THIS IS TAKEN TO THE NEXT STAGE AS INPUT.

UNIT- II

VALUE ENGINEERING VALUE ENGINEERING IS A SET OF ACTIVITIES UNDERTAKEN TO INVESTIGATE THE DESIGN OF COMPONENTS IN A PRODUCT DEVELOPMENT PROCESS STRICTLY FROM A COST-VALUE PERSPECTIVE AND ALERT THE PRODUCT DEVELOPMENT TEAM TO ALTERNATIVES THAT COULD EITHER BRING DOWN THE COST, OR INCREASE THE VALUE BY IMPROVING THE FUNCTIONALITY AND PERFORMANCE WITHOUT INCREASING THE COST. THE DESIGN PROFESSIONAL DEEPLY ANALYZE VARIOUS OPTIONS IN CONJUNCTION WITH PROCUREMENT PERSONNEL, SUPPLIERS AND PRODUCTION PERSONNEL WITH RESPECT TO VALUE-COST DIMENSIONS OF THE PRODUCT BEING DEVELOPED. USUALLY, SEVERAL QUESTIONS ARE RAISED, WHICH INCLUDE FOLLOWING : CAN WE ELIMINATE CERTAIN FEATURES FROM THE DESIGN? ARE THERE INSTANCES OF OVER-DESIGN IN CERTAIN COMPONENTS WHICH INCREASES THE COST? IF SO, HOW CAN THESE ASPECTS BE RATIONALIZED? ARE THERE CERTAIN FEATURES OF DESIGN THAT COST MORE THAN THEY ARE WORTH? IS IT POSSIBLE TO REPLACE THE PROPOSED METHOD OF MANUFACTURE WITH A LESS COSTLY ONE?

UNIT- II

IS IT POSSIBLE FOR SOMEONE ELSE (SUPPLIER) TO PRODUCE CERTAIN COMPONENTS CHEAPER, FASTER AND BETTER? CAN WE ELIMINATE SOME PARTS AND REPLACE THEM WITH MORE UNIVERSAL PARTS? ARE THERE OPPORTUNITIES FOR COST CUTTING BY DEVELOPMENT OF IMPORT SUBSTITUTION METHODS? THROUGH A SERIES OF ABOVE BRAINSTROMING EXERCISES, SOME COST REDUCTION OPPORTUNITIES ARE IDENTIFIED AND NECESSARY STEPS ARE TAKEN TO INCORPORATE THEM IN THE DESIGN. DESIGN FOR MANUFACTURABILITY (DFM) THE DESIGN FOR MANUFACTURABILITY IS A STRUCTURED APPROACH TO ENSURE THAT MANUFACTURING REQUIREMENTS AND PREFERENCES ARE CONSIDERED FAIRLY EARLY IN THE DESIGN PROCESS WITHOUT THE NEED FOR EXTENSIVE COORDINATION BETWEEN THE TWO. DFM GUIDELINES ADDRESS THREE SETS OF GENERIC REQUIREMENTS : REDUCING VARIETY, CONSIDERING OPERATIONAL CONVENIENCE, AND REDUCING COST.

UNIT- II

THE FOLLOWING ARE SOME OF THE GUIDELINES PERTAINING TO DFM. 1. GUIDELINE TO BE FOLLOWED FOR REDUCING VARIETY : MINIMIZE THE NUMBER OF PARTS MINIMIZE SUB-ASSEMBLIES AVOID SEPARATE FASTENERS USE STANDARD PARTS WHEN POSSIBLE DESIGN PARTS FOR MULTI-USE DEVELOP MODULAR DESIGN USE REPEATED AND KNOWN PROCESSES 2.GUIDELINES TO BE FOLLOWED FOR REDUCING COST : ANALYZE FAILURES ASSESS VALUE RIGOROUSLY

UNIT- II

3.GUIDELINES TO BE FOLLOWED FOR CONSIDERING OPERATIONAL CONVENIENCE: SIMPLIFY OPERATIONS ELIMINATE ADJUSTMENTS AVOID TOOLS DESIGN FOR MINIMUM HANDLING DESIGN FOR TOP-DOWN ASSEMBLY DESIGN FOR EFFICIENT AND ADEQUATE TESTING DESIGN FOR ASSEMBLY THE UNDERLYING PHILOSOPHY OF DFM CAN BE EXTENDED TO HAVE DESIGN FOR ASSEMBLY AND DESIGN FOR ENVIRONMENT. DESIGN FOR QUALITY DESIGN QUALITY REFERS TO THE INHERENT VALUE OF THE PRODUCT IN THE MARKET PLACE AND IS THUS A STRATEGIC DECISION OF THE FIRM. THE COMMON DIMENSIONS OF DESIGN QUALITY ARE LISTED IN TABLE BELOW. PERFORMANCE FEATURES

UNIT - II

RELIABILITY DURABILITY SERVICABILITY RESPONSE AESTHATICS REPUTATION MASS CUSTIMIZATION The process of delivering wide-market goods and services that are modified to satisfy a specific customer need. Mass customization is a marketing and manufacturing technique that combines the flexibility and personalization of "custom-made" at low unit costs of mass production. Many applications of mass customization include software-based product configurations that allow end-users to add and/or change certain functionalities of a core product. CUSTOMIZATION CAN HAPPEN AT THE DESIGN STAGE ITSELF, WHICH REQUIRES SOME COLLABORATIVE EFFORT WITH CUSTOMERS. IN SOME CASES, THE CUSTIMIZATION HAPPENS POST-DESIGN.

UNIT II

ONE OF THE USEFUL TECHNIQUES FOR MASS CUSTOMIZATION IS TO EMPLOY VARIETY-REDUCTION TECHNIQUES. THE USE OF A STANDARD SET OF FASTENERS IS A COMMONLY RECOMMENDED PRACTICE FOR VARIETY REDUCTION. THE SECOND APPROACH IS TO PROMOTE MODULAR DESIGN. THE ADVANTAGE OF MODULAR DESIGN IS THAT WITH RELATIVELY FEWER SUB-ASSEMBLIES (OR MODULES) IT WILL BE POSSIBLE TO CREATE A VARIETY LARGE NUMBER OF FINAL PRODUCTS. THE COMPUTER HARDWARE INDUSTRY PROVIDES AN IDEAL EXAMPLE OF MODULAR DESIGN. THE THIRD APPROACH IS TO MAKE USE OF THE CONCEPT OF PRODUCT PLATFORMS. A PRODUCT PLATFORM IS A COLLECTION OF ASSETS THAT ARE SHARED BY A SET OF PRODUCTS. THESE ASSETS COULD BE COMPONENTS INCLUDING PARTS, DESIGNS, FIXTURES AND TOOLS OR MANUFACTURING PROCESSES FOR MANUFACTURING AND ASSEMBLY. TRADITIONALLY, THE PRODUCT DEVELOPMENT PROCESS HAS BEEN MORE FOCUSED ON ONE PRODUCT AT A TIME. WHILE SUCH AN APPROACH MAY HAVE RESULTED IN GOOD DESIGN PRODUCTIVITY, IT MISSED OPPORTUNITIES FOR FASTER NEW PRODUCT INTRODUCTION IN A SUCCESSIVE MANNER. AUTOMOBILE MANUFACTURERS SUCH AS HONDA AND FORD DIRECT DESIGN EFFORTS TOWARDS A FAMILY OF PRODUCTS AS OPPOSED TO THE TRADITIONAL ONE AT A TIME APPROACH. THIS IS THE BASIC PREMISE BEHIND THE PRODUCT-PLATFORM APPROACH TO THE PRODUCT DEVELOPMENT.

UNIT II
PROCESS - A PROCESS IS THE BASIC BUILDING BLOCK OF OPERATION. IT CONSISTS OF A SET OF ACTIVITIES THAT NEED TO BE PERFORMED BY USING SOME RESOURCES AND TIME. THIS EVENTUALLY DETERMINES THE PERFORMANCE OF THE OPERATIONS SYSTEMS IN TERMS OF COST, TIME, PRODUCTIVITY, PROFIT, ETC. CONSIDER A FAST-FOOD RESTAURANT. WHEN THE CUSTOMER GOES TO THE COUNTER AND PLACES AN ORDER FOR THE FOOD ITEMS, THE OUTCOME IS DETERMINED BY THE PROCESS EMPLOYED TO SATISFY THIS CUSTOMER DEMAND. THE STEPS INVOLVED IN SERVING THE DEMAND, THE NUMBER OF PEOPLE INVOLVED, THE NATURE OF RESOURCES CONSUMED AND THE TIME TAKEN TO SERVE THIS CUSTOMER WILL ALL DEPEND ON THE PROCESS DESIGN . CONSIDER AN AUTOMOBILE GARAGE THAT DEALS WITH ALL ASPECTS OF THE REPAIR OF WHEELS AND TYRES SUCH AS WHEEL ALIGNMENT, WHEEL BALANCING, TYRE AND TUBE REPLACEMENTS, AND REPAIRING OF PUNCTURED TYRES. HERE ALSO THE DESIGN OF PROCESS WILL DETERMINE THE PERFORMANCE OF AUTOMOBILE GARAGE. PROCESS SELECTION PROCESS ENGINEERING REFERS TO THE TACTICAL PLANNING ACTIVITIES THAT REGULARLY OCCURS IN MANUFACTURING. PROCESS SELECTION REFERS TO THE STRATEGIC DECISION OF SELECTING WHICH KIND OF PRODUCTION PROCESSES TO HAVE IN THE PLANT. FOR EXAMPLE, IN THE CASE OF MOTOR DRIVE, IF THE VOLUME IS VERY LOW, WE MIGHT JUST HAVE A WORKER SIT AT A TABLE AND PRODUCE A SMALL BATCH OF SUCH ASSEMBLIES. ON THE OTHER HAND, IF THE VOLUME IS VERY HIGH, SETTING UP AN ASSEMBLY LINE MIGHT BE APPROPRIATE.

UNIT II

TYPES OF PROCESSES PROCESSES ARE CATEGORIZED BASED ON HOW THEY ARE DESIGNED. ANOTHER WAY TO CATEGORIZE PROCESSES IS BASED ON WHAT THEY DO. AT THE MOST BASIC LEVEL, THE TYPES OF PROCESSES DO THE FOLLOWING THINGS : CONVERSION PROCESSES, FOR EXAMPLE, CHANGING IRON INTO STEEL SHEETS. FABRICATION PROCESSES , FOR EXAMPLE, CHANGING SHEET METAL INTO CAR BODY. ASSEMBLY PROCESSES, FOR EXAMPLE, ASSEMBLYING ENGINE, GEARBOX, RADIATOR WITH CAR BODY. PROCESS CHARACTERISTICS ARE LARGELY DETERMINED BY THE FLOW OF PRODUCTS IN A MANUFACTURING SYSTEM. THREE TYPES OF FLOWS EXIST IN MANUFACTURING SYSTEMS : CONTINUOUS, INTERMITTENT, AND JUMBLED. CONTINUOUS FLOW SYSTEM A CONTINUOUS FLOW SYSTEM IS CHARACTERIZED BY A STREAMLINED FLOW OF PRODUCTS IN THE OPERATING SYSTEM. IN SUCH SYSTEMS, THE CONVERSION PROCESS BEGINS WITH THE INPUT OF RAW MATERIAL AT ONE END. IT PROGRESSES TROUGH THE SYSTEM IN AN ORDERLY FASHION TO FINALLY BECOME FINISHED GOODS. THE PRODUCTION PROCESS IS SEQUENTIAL AND THE REQUIRED RESOURCES ARE ORGANIZED IN STAGES. EXAMPLES ARE MANUFACTURE OF PETROCHEMICALS, STEEL, PHARMACEUTICALS, CEMENT AND GLASS.

UNIT II MASS PRODUCTION THE MASS PRODUCTION SYSTEM IN THE MANUFACTURING INDUSTRY IS ANOTHER EXAMPLE OF CONTINUOUS AND STREAMLINED FLOW IN THE MANUFACTURING SYSTEM. IN A MASS PRODUCTION SYSTEM, THE VOLUME OF PRODUCTION IS VERY HIGH AND THE NUMBER OF VARIATIONS IN THE FINAL PRODUCT IS LOW. THEREFORE, IT IS POSSIBLE TO ORGANIZE THE ENTIRE PROCESS BY DEDICATING THE REQUIRED MANUFACTURING RESOURCES FOR EACH PRODUCT VARIANT AND ARRANGING THE RESOURCES ONE AFTER THE OTHER AS PER THE MANUFACTURING SEQUENCE. THE MANUFACTURE OF ELECTRICAL COMPONENTS (SUCH AS SWITCHES), TWO-WHEELER MANUFACTURE, HEALTHCARE PRODUCTS (SUCH AS DISPOSABLE SYRINGES) ALL ARE TYPIACL EXAMPLES OF HIGH-VOLUME PRODUCTION. INTERMITTENT FLOW SYSTEM - AS CUSTOMER PREFERENCES INCREASE, THE NEED FOR CREATING MORE VARIETY ALSO INCREASES AND FIRMS RESPOND TO THIS REQUIREMENT BY EXPANDING THE PRODUCT LINE. MOREOVER, AS COMPETITION INCREASES, ORGANIZATIONS TRY TO RETAIN THEIR MARKET SHARE BY INTRODUCING NEW PRODUCTS. EXAMPLES ARE CAR MANUFACTURING SYSTEM.

UNIT II

JUMBLED FLOW SYSTEM - THIS OCCURS ON ACCOUNT OF NONSTANDARD AND COMPLEX FLOW PATTERNS CHARACTERISTIC OF CERTAIN MANUFACTURING SYSTEMS. THE FLOW PATTERN IS NON-STANDARD AND COMPLEX BECAUSE THERE ARE UNIQUE PROCESS DESIGNS FOR EACH AND EVERY CUSTOMER ORDER. MOREOVER, CUSTOMER ORDERS ARE TYPICALLY FOR ONE-OFF ITEM AND ORGANIZATION CAN NOT BENEFIT FROM ANY BATCH PROCESSING AND REPETITIVE MANUFACTURING PRACTICES. IN REALITY, TWO TYPES OF MANUFACTURING SYSTEMS HAVE JUMBLED FLOW : PROJECT ORGANIZATION SYSTEM AND CUSTOMIZED MANUFACTURING SYSTEM.

UNIT II Fig.4.4 Process design and flow structure for a mass production system Pre-manufacturing activities
Product A Product B Product C

Machining Fabrication

Machining Fabrication

Machining Fabrication

Assembly
Testing

Assembly
Testing

Assembly
Testing

Dedicated and decentralized manufacturing support

Product A
Machine 1

Machine 2

Machine 3

00000

Machine m

UNIT II

Fig.4.5 Process design for intermittent flow in a manufacturing system

Pre-manufacturing Activities

Gear Components

Sheet metal parts

Prismatic components

Shafts

Housings

Other rotating parts

Assembly and testing of Product A

Assembly and testing of Product B

Assembly and testing of Product C

Dedicated manufacturing support for the products

UNIT-II DETERMINANT OF PROCESS SELECTION: 1. NATURE OF PRODUCT(OR SERVICE) DEMAND 2. DEGREE OF VERTICAL INTEGRATION 3. PRODUCTION FLEXIBILITY 4. DEGREE OF AUTOMATION 5. PRODUCT(OR SERVICE) QUALITY

UNIT-II

1.NATURE OF PRODUCT(OR SERVICE) DEMAND

PRODUCTION PROCESSES MUST HAVE ADEQUATE CAPACITY TO PRODUCE THE VOLUME OF THE PRODUCTS/SERVICES THAT CUSTOMERS NEED. PROVISIONS MUST BE MADE FOR EXPANDING OR CONTRACTING CAPACITY TO KEEP PACE WITH DEMAND PATTERNS. SOME TYPES OF PROCESSES ARE MORE EASILY EXPANDED AND CONTRACTED THAN OTHERS. PRODUCT(OR SERVICE) PRICE AFFECTS DEMAND, SO PRICING DECISIONS AND THE CHOICE OF PROCESSES MUST BE SYNCHRONIZED.

UNIT-II

2.DEGREE OF VERTICAL INTEGRATION VERTICAL INTEGRATION IS THE AMOUNT OF THE PRODUCTION AND DISTRIBUTION CHAIN THAT IS BROUGHT UNDER THE OWNERSHIP OF A COMPANY. THIS DETERMINES HOW MANY PRODUCTION PROCESSES NEED TO BE PLANNED AND DESIGNED.
DECISION OF INTEGRATION IS BASED ON COST, AVAILABILITY OF CAPITAL, TECHNOLOGICAL CAPABILITY, QUALITY, AND MORE. STRATEGIC OUTSOURCING (LOWER DEGREE OF INTEGRATION) IS THE OUTSOURCING OF PROCESSES IN ORDER TO REACT QUICKER TO CHANGES IN CUSTOMER NEEDS, COMPETITOR ACTIONS, AND TECHNOLOGY.

UNIT-II

3.PRODUCTION FLEXIBILITY PRODUCTION FLEXIBILITY MEANS HOW FAST AN ORGANIZATION IS ABLE TO RESPOND TO CUSTOMERS REQUIREMENT. PRODUCT FLEXIBILITY -- ABILITY OF THE PRODUCTION (OR DELIVERY) SYSTEM TO QUICKLY CHANGE FROM PRODUCING (DELIVERING) ONE PRODUCT (OR SERVICE) TO ANOTHER.
VOLUME FLEXIBILITY -- ABILITY TO QUICKLY INCREASE OR REDUCE THE VOLUME OF PRODUCT( OR SERVICE) PRODUCED (OR DELIVERED).

UNIT-II

4.DEGREE OF AUTOMATION ADVANTAGES OF AUTOMATION IMPROVES PRODUCT QUALITY IMPROVES PRODUCT FLEXIBILITY REDUCES LABOR COSTS
DISADVANTAGES OF AUTOMATION EQUIPMENT CAN BE VERY EXPENSIVE INTEGRATION INTO EXISTING OPERATIONS CAN BE DIFFICULT

UNIT-II 5.PRODUCT(OR SERVICE) QUALITY OLD VIEWPOINT HIGH-QUALITY PRODUCTS MUST BE MADE IN SMALL QUANTITIES BY EXPERT CRAFTSMEN NEW VIEWPOINT HIGH-QUALITY PRODUCTS CAN BE MASS-PRODUCED USING AUTOMATED MACHINERY AUTOMATED MACHINERY CAN PRODUCE PRODUCTS OF INCREDIBLE UNIFORMITY THE CHOICE OF DESIGN OF PRODUCTION PROCESSES IS AFFECTED BY THE NEED FOR TYPE OF QUALITY.

UNIT II

THE PROCESS-PRODUCT MATRIX A PROCESS-PRODUCT MATRIX DEPICTS THE RELATIONSHIP BETWEEN PRODUCT CHARACTERISTICS AND THE PROCESS CHARACTERISTICS. ONE DIMENSION OF THE MATRIX REPRESENTS PRODUCT CHARACTERISTICS AND THE OTHER PROCESS CHARACTERISTICS. PRODUCT CHARACTERISTICS ESSENTIALLY INDICATE THE DEGREE OF CUSTOMIZATION AND THE VOLUME OF PRODUCTION. ON THE OTHER HAND, PROCESS CHARACTERISTICS INDICATE THE COMPLEXITY AND THE DIVERGENCE IN THE PROCESS. WHEN ORGANIZATIONS HAVE A HIGH VOLUME OF PRODUCTION, THE FLOW WILL BE STREAMLINED. SIMILARLY, WHEN THE VARIETY IS HIGH, THE FLOW WILL BE JUMBLED. A PROCESS-PRODUCT MATRIX DEPICTS ALL THESE RELATIONSHIPS IN A COMPACT FORM, AS SHOWN IN FIG.4.8.

UNIT II
Low volume, low Standardization, One-of-a-kind Jumbled Flow Satellite launch vehicle Machine tools Auto electric parts Petrol & Diesel Multiple products, Low volume Few major products, Higher volume High volume, high standardization, commodity products

None

Disconnected Line Flow

Connected Line Flow

Continuous Flow

None

Fig.4.8 Process-product matrix

Product Screening Tool Break-Even Analysis

Computes the quantity of goods company needs to sell to cover its costs QBE = FC/ (SP - VC)
QBE : Break even quantity FC : Fixed costs SP : selling price/unit VC : Variable cost/unit

Product Screening Tool Break-Even Analysis

Break-even analysis also includes calculating
Total cost which is sum of fixed and variable cost Total cost = FC + (VC)*Q Revenue The amount of money brought in from sales Revenue = (SP) * Q SP = Selling price per unit Q = number of units sold FC = Fixed Cost VC = Variable Cost

Break-Even Analysis: Graphical Approach

Compute quantity of goods that must be sold to breakeven Compute total revenue at an assumed selling price Compute fixed cost and variable cost for several quantities Plot the total revenue line and the total cost line Intersection is break-even

Cost Functions of Processing Alternatives

#1. Three production processes (A, B, and C) have the following cost structure:
Fixed Cost Per Year $120,000 90,000 80,000 Variable Cost Per Year $3.00 4.00 4.50

Process A B C

What is the most economical process for a volume of 8,000 units per year? Which process to be selected based on break even analysis, if selling price is $6.95?

Cost Functions of Processing Alternatives

Solution : TC = FC + VC * (Q)

A: TC = 120,000 + 3.00(8,000) = $144,000 per year B: TC = 90,000 + 4.00(8,000) = $122,000 per year C: TC = 80,000 + 4.50(8,000) = $116,000 per year The most economical process at 8,000 units is Process C, with the lowest annual cost.

Break-Even Analysis
Solution : Break-Even Points of Processes A, B, and C may be computed as below : Q = FC / (SP - VC) 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 Since, Process A has the lowest break-even point, so Process-A is to be selected.

UNIT-II

Q. Potential locations A, B, and C have following cost

structures for producing immersion coil which is expected to be sold at Rs.100 per unit. Find the most economical location for an expected volume of 2000 units per year. Also determine the range of annual volume of production for which each of the locations A, B, and C would be most economical. Location Fixed cost/year(Rs.) A 25,000 B 50,000 C 80,000 Variable cost/Unit(Rs.) 50 25 15

UNIT-II

# XYZ Company is trying to determine how best to produce a new product.The new product could be produced in-house using either Process-A or Proces-B Or purchased from a supplier. Cost data is given below. Process Process-A Process-B Purchase Fixed Cost Rs.8000 Rs.20000 NIL Variable cost/unit Rs.10 Rs.4 Rs.20

For what level of demand should each alternative be chosen?

UNIT-II
Solution :PURCHASE PROCESS-A

PROCESS-B

20000 COST

8000

Q2=800 QUANTITY

Q1=2000

UNIT-II

Let Q1 be the Break-even quantity between Process-A & Process-B. For producing Q1, Total cost by Process-A = Total cost by Process-B. TCA = TCB Or, FCA + VCA x Q1 = FCB + VCB x Q1 Or, 8000 + 10 x Q1 = 20000 + 4 x Q1 Or, 6Q1 = 12000 Or, Q1 = 2000 Purchase cost for 2000 units = Rs.2000 x 20 = Rs.40000 Manufacturing cost for producing 2000 units By Process-A = 8000 + 10 x 2000 =Rs.28000 By Process-B = 20000 + 4 x 2000 =Rs.28000

UNIT-II

Let Q2 be the Break-even quantity between Process-A and Purchasing from outside. Then, FCA + VCA x Q2 = Q2 x Purchase Cost Or, 8000 + 10 x Q2 = Q2 x 20 Or, 10Q2 = 8000 Or, Q2 = 800 Based on above, the recommendations are as follows : 1.Upto 800 units it is most economical to purchase from outside. 2.Between 800 to 2000 units, go for Process-A 3.Beyond 2000 units, it is economical to use Process-B

UNIT II

FACILITY PLANNING : Facility planning means planning of land, building, equipment, and furnishings, providing the physical capabilities to add value to the organization. Facility layout planning is made to determine the best physical arrangement of resources (e.g. shops, ware house, equipment, testing labs etc.) within a facility. Facility resource arrangement can significantly affect productivity.

UNIT II FACILITIES LAYOUT TYPES OF LAYOUT ARE : 1. PROCESS LAYOUT (JOB-SHOP OR FUNCTIONAL LAYOUT)

2. PRODUCT LAYOUT (FLOW-SHOP LAYOUT) 3. FIXED POSITION LAYOUT 4. GROUP TECHNOLOGY LAYOUT

UNIT II

PROCESS LAYOUT IN THIS TYPE SIMILAR EQUIPMENT OR FUNCTIONS ARE GROUPED TOGETHER. STEPS FOR DEVELOPING PROCESS LAYOUT : TO ASCERTAIN NATURE OF FLOW BETWEEN DEPARTMENT AND THE PROCESS OF TRANSPORTATION OF MATERIALS
TO DEVELOP A MODEL ILLUSTRATING INTERDEPARTMENTAL FLOW

NEXT TO DETERMINE THE COST OF THIS LAYOUT BY MULTIPLYING MATERIAL HANDLING COST BY NUMBER OF LOADS MOVED BETWEEN EACH PAIR OF DEPARTMENTS
NEXT TO OPTIMIZE COST BY CHANGING DEPARTMENTAL POSITIONS TO ARRIVE AT LOWEST LAYOUT COST

UNIT II Fig.4.9 Example of a process layout

Product A Product B Product C

D D

D D

M G

L: Lathe m/c D: Drilling m/c M:Milling m/c G:Grinding m/c

UNIT II

Layout-I (Arrangement of deptt.) 1 2 3 4 6 7 5 8 9

Layout-II (Arrangement of deptt.) 2 1 4 3 5 8 6 7 9

UNIT - II

Load movements from one deptt. to another deptt.

From 1 4 5 8 6 2 3 7 To 4 5 8 6 2 3 7 9 Weight(In kgs.) 20 15 20 10 50 25 20 80

UNIT -II

Cost of load movement from one deptt. To other

From
1 4 5 8 6 2 3 7

To
4 5 8 6 2 3 7 9

Cost in Rs./Kg 100 95 120 100 125 80 70 90

From
2 1 4 8 5 3 6

To
1 4 8 5 3 6 7

Cost in Rs/Kg 80 85 100 125 100 50 60

UNIT II PRODUCT LAYOUT IN THIS TYPE THE EQUIPMENT OR WORK PROCESSES ARE ARRANGED ACCORDING TO PROGRESSIVE STEPS BY WHICH THE PRODUCT IS MADE. EQUIPMENT OR DEPARTMENTS ARE DEDICATED TO A PARTICULAR PRODUCT LINE. DUPLICATE EQUIPMENT IS EMPLOYED TO AVOID BACKTRACKING STRAIGHT LINE FLOW OF MATERIAL MOVEMENT IS ACHIEVABLE THIS TYPE OF LAYOUT IS APPLICABLE WHEN BATCH SIZE OF A GIVEN PRODUCT IS LARGE RELATIVE TO THE NUMBER OF DIFFERENT PRODUCTS OR PARTS PRODUCED.

UNIT II

Fig.4.10 Example of a Product layout

Product A

Product B

Product C

L : Lathe machine D : Drilling machine G : Grinding machine M : Milling machine

UNIT II GROUP TECHNOLOGY LAYOUT A GROUP TECHNOLOGY LAYOUT GROUPS DISSIMILAR MACHINES INTO WORKCENTERS TO WORK ON PRODUCTS THAT HAVE SIMILAR SHAPE AND PROCESSING REQUIREMENTS. EXAMPLE : METAL FABRICATION SHOP FOR MAKING SCAFFOLDING ADVANTAGES : 1.IMPROVE OPERATOR EXPERTISE 2.LESS IN-PROCESS INVENTORY & MATERIAL HANDLING 3.FASTER PRODUCTION SETUP

UNIT II FIXED POSITION LAYOUT IN FIXED POSITION LAYOUT, THE PRODUCT BY VIRTUE OF ITS BULK AND WEIGHT REMAINS AT ONE LOCATION AND MANUFACTURING EQUIPMENT IS MOVED TO THE POSITION. CONSTRUCTION SITES ARE EXAMPLES OF THIS FORMAT. EXAMPLE : FABRICATION OF BIG OIL TANK IN REFINERY CONSTRUCTION SITE.

UNIT-II # A manufacturing unit has six departments A, B, C, D, E, and F.

They are located as shown in figure below. The daily expected load transactions in tons also given below : From A to B : 20 tons, from B to A : 10 tons, from B to C : 15 tons, from A to F : 25 tons, from C to D : 30 tons, from D to F : 40 tons, from D to C : 50 tons, from E to F : 10 tons and from F to E : 15 tons. Check whether the given arrangement of departments is optimal or not. If not, suggest a better layout.

A D

B E

C F

UNIT-II 1.CONSTRUCT A SQUARE MATRIX SHOWING THE LOAD TRANSACTION BETWEEN THE DEPARTMENTS
From To A B C D E F

B 10

20 15 30 15 25 40 10 50

UNIT-II 2.AS THE LOAD TRANSACTION FROM A to B AND B to A COVERS THE SAME DISTANCE, THEY MAY BE ADDED AND SHOWN AT ONE PLACE IN THE MATRIX. SIMILARLY FOR OTHER DEPARTMENTS ALSO. THE FOLLOWING MATRIX IS DRAWN TO CONSOLIDATE THE LOAD TRANSACTION.

From To

A
B C D E F

30 15

80
25 40 25

UNIT-II

3.ARRANGE THE DEPARTMENTS SIDE BY SIDE , WHICH ARE HAVING HIGHEST LOAD TRANSACTION SO THAT THE MATERIALS HANDING COST IS REDUCED.. 4.NOW FROM CONSOLIDATED LOAD MATRIX THE TRANSACTION BETWEEN DEPARTMENTS IS : BETWEEN A & B : 30 TONS , BETWEEN B & C : 15 TONS, BETWEEN C & D : 80 TONS, BETWEEN A & F : 25 TONS, BETWEEN D & F : 40 TONS AND BETWEEN E & F : 25 TONS. DEPENDING ON THE INFORMATION AVAILABLE, DEPARTMENTS D & C SHOULD BE SIDE BY SIDE, NEXT PREFERENCE TO DEPARTMENTS D & F AND THEN TO A &B, THEN A &F AND FINALLY TO B&C. 5.THE NEW LAYOUT WILL BE AS SHOWN BELOW :

C E

D F

A B

UNIT-II # Departments A,B,C,D,E and F are located as shown in the figure. The number on the arrows connecting two departments is the amount of material moving from one department to the other in the direction of arrow given. Check if the existing layout is good or not.
C

20
A

10 28
B

15 40

20
D

15
E

25 25
F

UNIT-II Solution :1.FROM THE GIVEN DIAGRAM, PREPARE THE TRAVEL CHART AND ENTER THE MATERIAL MOVING FROM ONE DEPARTMENT TO THE OTHER. FROM

A A B C D E F

B 10

C 15

TO

20 40 28

20 25 15 25

Fig. Load matrix showing tons of material moved per day

UNIT-II 2.From the load matrix let us identify the departments which are having larger movement of material between them. 3.For example, A to C or C to A is considered same. We are having more transaction between A to D(=40). Then comes E & C, next will be D &E and so on. Now the improved layout is given below. A 40 D 25 F

10

20

20

25

15

15

28

UNIT II ASSEMBLY LINE THIS IS A SPECIAL CASE OF PRODUCT LAYOUT CHARACTERISTICS OF ASSEMBLY LINE : PROGRESSIVE ASSEMBLY IS FACILITATED BY SOME MATERIAL HANDLING DEVICE SOME FORM OF PACING IS APPLIED PACING - MAY BE MECHANICAL OR MANUAL ALLOWABLE PROCESSING TIME IS EQUIVALENT FOR ALL WORKSTATIONS LINE TYPE - BELT OR ROLLER CONVEYOR LINE CONFIGURATION - U-SHAPE, STRAIGHT OR BRANCHING PRODUCT MIX - ONE PRODUCT OR MULTIPLE PRODUCTS WORKSTATION - WORKER MAY SIT, STAND, WALK WITH THE LINE OR RIDE ON THE LINE

UNIT II

ASSEMBLY LINE BALANCING WORK STATION CYCLE TIME - TIME BETWEEN SUCCESSIVE UNITS COMING OFF THE END OF THE LINE STEPS IN BALANCING AN ASSEMBLY LINE : SPECIFY SEQUENTIAL RELATIONSHIPS AMONG TASKS USING A PRECEDENCE DIAGRAM. DETERMINE THE REQUIRED WORKSTATION CYCLE TIME C = (PRODUCTION TIME PER DAY)/(OUTPUT PER DAY) DETERMINE MINIMUM NUMBER OF WORKSTATIONS REQUIRED TO SATISFY WORKSTATION CYCLE TIME FROM THE EQUATION : SN = [SUM OF TASK TIMES(T) ] / CYCLE TIME ( C ) SELECT A PRIMARY RULE BY WHICH THE TASKS ARE TO BE ASSIGNED TO WORKSTATIONS, AND A SECONDARY RULE TO BREAK TIES.

UNIT II

ASSIGN TASKS, ONE AT A TIME, TO THE FIRST WORKSTATION UNTIL THE SUM OF THE TASK TIMES IS EQUAL TO THE WORKSTATION CYCLE TIME, OR NO OTHER TASKS ARE FEASIBLE BECAUSE OF TIME OR SEQUENCE RESTRICTION. REPEAT THE SAME PROCESS FOR NEXT WORKSTATIONS. EVALUATE THE EFFICIENCY OF THE BALANCE FROM EQUATION : EFFICIENCY = [SUM OF TASK TIME]/[ACTUAL NO. OF WORKSTATIONS X WORKSTATION CYCLE TIME] IF EFFICIENCY IS UNSATISFACTORY, REBALANCE USING A DIFFERENT DECISION RULE. DECISION RULES 1.PRIMARY RULE : a) PRIORITIZE TASKS IN ORDER OF THE LARGEST NUMBER OF FOLLOWING TASKS b) PRIRITIZE TASKS IN ORDER OF THE LONGEST TASK TIME 2.SECONDARY RULE : THE SECONDARY RULE TO BE INVOKED WHERE TIE EXISTS FROM PRIMARY RULE

UNIT II

Precedence chart
Task
A B C D E

F G

Task Time (Seconds) 45 11 9 50 15 55 45

Task that must precede A B D E,C F

UNIT II

Precedence Graph : 11 45
A B

9 55
F

45

50
TASK A B D

15

NUMBER OF FOLLOWING TASKS 4 3 3

UNIT-II ASSEMBLY LINE BALANCING BY RANK POSITIONAL WEIGHT METHOD : 1.COMPUTE THE POSITIONAL WEIGHT(ITS OWN PROCESSING TIME PLUS THE PROCESSING TIMES OF ALL THE FOLLOWING WORK ELEMENTS) OF ALL THE WORK ELEMENTS IN THE NETWORK. 2.ASSIGN THOSE JOBS FIRST WHOSE FOLLOWERS HAVE THE LARGEST TOTAL TIME. 3.A WORK ELEMENT CAN BE INCLUDED IN THE LIST-A IF IT CAN SATISFY THE FOLLOWING TWO CONDITIONS : i. ALL THE IMMEDIATE PREDECESSORS ARE ALREADY ASSIGNED TO SOME STATIONS. ii. ITS PROCESSING TIME IS LESS THAN OR EQUAL TO UACT(Unassigned cycle time) 4.CALCULATE THE CYCLE TIME = (PRODUCTION TIME/DAY) (OUTPUT/DAY) 5.COMPUTE THE BALANCING EFFICIENCY =[ 1 (SUACT/CT x SN)] [SUACT : SUM OF UNASSIGNED CYCLE TIME, CT : CYCLE TIME SN : STATION NUMBER ]

UNIT-II # Consider the assembly network shown below which represents the precedence relationships in assembling a product. The number by the side of each node represents the processing time in minutes. The required production volume in 8hour shift is 24 completed assemblies. Design an assembly line using Rank Positional Weight Method. 3

4
6 5

10

5 1

7 3
3 6

6 8

UNIT-II # Consider the assembly network shown below which represents the precedence relationships in assembling a product. The number by the side of each node represents the processing time in minutes. The required production volume in 8hour shift is 24 completed assemblies. Design an assembly line using Rank Positional Weight Method.
16

4
6 5
21

13

31

10

9
9

5 1
56

7 3
3 6
18

6 8
15

5
31

8
17

UNIT-II Table1 : Details of Work Elements

Work Element Number 1 2 3 4 5 6 7 Time Positional Weight 56 16 31 31 21 18 13 Immediate Predecessors 1 1 1 3 3 2 4 -

5 3 7 5 6 3 4

8
9 10

6
8 9

15
17 9

5
4 7

6
8

UNIT-II Table 2 : Details of Stations Station Number 1

List-A Work Element Selected Unassigned Cycle Time Remarks

1 2,3,4 2,3,9 6,2

1 4 3 6 5 9 2 -

20 15 10 3 0 20 14 6 3 3

Break tie between 3&4 randomly Change over to next station Change over to next station

2,5,9 2,8,9 2,8 -

UNIT-II Table 2 : Details of Stations Station Number 3

List-A Work Element Selected Unassigned Cycle Time Remarks

7,8 7 10

8 7 10

20 14 10 1

CYCLE TIME = (PRODUCTION TIME/DAY) (OUTPUT/DAY) = (8 x 60) 24 = 20 MINUTES BALANCING EFFICIENCY = [ 1 (SUCAT)/CT x SN] x 100 = [ 1 (4/ 20 x 3)] x 100 = 93.33%

UNIT-II

#.Consider the following assembly network relationships of a product. The number of shifts per day is one and number of working hours per shift is 8. The company aims to produce 40 units of the product per shift. Group the activities into work stations using Rank Positional Weight Method and compute Balancing Efficiency.

UNIT-II
OPERATION NUMBER 1 2 3 4 5 6 7 8 9 IMMEDIATE PRECEDING TASK 1 1 1 1 3,7 2 4,5 2,6 DURATION (MIN) 8 3 2 4 7 4 5 6 8

10 11
12 13 14

7,8,9 5
9,10 8,10,11 12,13

9 4
3 6 3

UNIT-II FACILITY LOCATION ISSUES IN FACILITY LOCATION : 1.PROXIMITY TO CUSTOMERS 2.BUSINESS CLIMATE 3.TOTAL COST 4.INFRASTRUCTURE 5.LABOURS 6.SUPPLIERS 7.ENVIRONMENTAL REGULATION 8.POLITICAL RISK (GEOPOLITICAL SCENE)

UNIT II FACILITIES LOCATIONS ISSUES IN FACILITIES LOCATION : 1.PROXIMITY TO CUSTOMERS - BETTER OPTION DUE TO GOOD UNDERSTANDING OF CUSTOMER NEEDS, FULLFILLING TRADE AGREEMENTS & LESS SHIPPING COSTS. 2.BUSINESS CLIMATE - INCLUDES PRESENCE OF COMPANIES IN THE SAME INDUSTRY, PRO-BUSINESS GOVT. LEGISLATION AND APPROACH OF LOCAL GOVT. TO FACILITATE BUSINESS LOCATING IN AN AREA VIA SUBSIDIES, TAX ABATEMENTS. 3.TOTAL COSTS - THE TOTAL COST WHICH INCLUDES COST OF LAND, CONSTRUCTION, LABOUR, ENERGY COST, INBOUND DISTRIBUTION COSTS AND OUTBOUND DISTRIBUTION COSTS AND TAXES FOR A SELECTED SITE SHOUILD BE LOWEST. 4.INFRASTRUCTURE - AVAILABILITY OF RAIL, ROAD, AIR AND PORT FACILITY IN ADDITION TO REQUIREMENT OF POWER AND TELECOMMUNICATION . 5.LABOURS - AVAILABILITY OF SKILLED & UNSKILLED LABOUR POOL.

UNIT II 6.SUPPLIER - A HIGH QUALITY AND COMPETITIVE SUPPLIER BASE , PROXIMITY OF IMPORTANT SUPPLIERS PLANT MAKES THE LOCATION SUITABLE. 7.ENVIRONMENTAL REGULATION - THIS HAS IMPACT ON CERTAIN INDUSTRY IN A GIVEN LOCATION. BESIDES COST IMPLICATIONS, THESE REGULATIONS INFLUENCE RELATIONSHIP WITH THE LOCAL COMMUNITY. 8.POLITICAL RISK - GEOPOLITICAL SCENES IN SOME STATES OFFERS EXCITING AND CHALLANGING OPPORTUNITIES .BUT DUE TO THE PHASE OF TRANSFORMATION, THE DECISION ON LOCATING A FACILITY IN A PARTICULAR REGION MAY BECOME DIFFICULT.

UNIT II

PLANT OR FACILITY LOCATION METHOD FACTOR RATING METHOD :

FACTORS TAX ADVANTAGE AVAILABILITY OF SKILLED LABOUR FACTOR RATING O-8 0-3 LOCATION - A 8 2 LOCATION - B 6 3

PROXIMITY TO 0 - 6 CUSTOMER
PROXIMITY TO 0 - 5 SUPPLIER WATER AVAILABILITY POWER AVAILABILITY 0-3 0-6

6
2 3 6

5
4 3 4

UNIT II

FACTORS RECEPTIVITY OF COMMUNITY QUALITY OF EDUCATIONAL SYSTEM ACCESS TO RAIL, ROAD & AIR PORT SUITABILITY OF CLIMATE

FACTOR RATING 0 -5 0 -4

LOCATION - A 4 1

LOCATION - B 3 2

0 - 10 0 - 10 TOTAL SCORE :

10 7

8 9

UNIT II PLANT/FACILITY LOCATION METHODS 1.FACTOR RATING SYSTEM - A MECHANISM TO COMBINE DIFFERENT FACTORS BY ASSIGNING RANGE OF POINT VALUES TO MAJOR FACTORS FOR EVALUATING POSSIBLE SITES. FOR EXAMPLE, A REFINERY ASSIGNED FOLLOWING RANGE OF POINT VALUES :
RANGE FUELS IN REGION
POWER AVAILABILITY AND RELIABILITY LABOR CLIMATE LIVING CONDITIONS TRANSPORTATION WATER SUPPLY

0 TO 330
0 TO 200 0 TO 100 0 TO 100 0 TO 50 0 TO 10

CLIMATE
SUPPLIERS TAX POLICIES AND LAWS

0 TO 50
0 TO 60 0 TO 20

UNIT II

CENTROID METHOD THIS TECHNIQUE IS OFTEN USED FOR LOCATING INTERMEDIATE FACILITIES TAKING INTO CONSIDERATION THE EXISTING FACILITIES, DISTANCE BETWEEN THEM AND THE VOLUME OF GOODS TO BE SUPPLIED. THE METHOD ASSUMES THAT INBOUND & OUTBOUND TRANSPORTATION COSTS ARE EQUAL AND DOES NOT INCLUDE SHIPPING COST FOR LESS THAN FULL LOADS. THE METHOD BEGINS BY PLACING EXISTING LOCATIONS ON COORDINATE GRID SYSTEM THE CENTROID IS FOUND BY CALCULATING X & Y COORDINATES AS FOLLOWS THAT RESULT IN MINIMAL TRANSPORTATION COST : Cx = (Xi Vi) / Vi and Cy =(Yi Vi) / Vi where Cx = X coordinate of the centroid Cy = Y coordinate of the centroid Xi = X coordinate of the ith location Yi = Y coordinate of the ith location Vi = Volume of goods moved to or from ith location

Designing Process Layout

Step 1: Gather information: Space needed, space available, importance of proximity between various units Step 2: Develop alternative block plans: Using trial-and-error or decision support tools Step 3: Develop a detailed layout Consider exact sizes and shapes of departments and work centers including aisles and stairways Tools like drawings, 3-D models, and CAD software are available to facilitate this process

Design of Process Layout

Gather information on from-to matrix Develop a new block layout Find out the load-distance; one with minimum load-distance is preferred layout Let us make an optimum layout of following current Hospital layout
A Radiology 400 sq. ft. D Examining Rooms 800 sq. ft. B Laboratory 300 sq. ft. E Surgery & Recovery 900 sq. ft. F Physical Therapy 1050 sq. ft. C Lobby & Waiting 300 sq. ft.

Design of Process Layout

Design of Process Layout

Revised Layout by Trial & Error Method A D C

UNIT II
Current Layout
DEPTT. No. of trips Distance obtd. From current layout 1 2 3 2 1 2 3 2 1 Load Distance

Proposed Layout
Distance obtd. From current layout 1 1 3 1 1 1 1 3 1 Load Distance

A&D A&E A&F B&D B &E B&F C&D C&E C&F

45 12 25 45 14 5 50 20 43

45 24 75 90 14 10 150 40 43

45 12 75 45 14 5 50 60 43

D&F

12

2 Total :

24 515

2 Total :

24 373

UNIT II LOAD DISTANCE METHOD THE LOAD DISTANCE METHOD PROVIDES AN OBJECTIVE MEASURE OF THE TOTAL LOAD DISTANCE FOR EACH OF THE POTENTIAL LOCATION. DISTANCE IS USED USING A CARTESIAN MEASURE. LET, NUMBER OF EXISTING DEMAND (OR SUPPLY) POINTS IN GRID MAP = n INDEX USED FOR EXISTING DEMAND(SUPPLY) POINTS = i COORDINATES FOR EXISTING DEMAND (OR SUPPLY) POINTS i INTHE GRID MAP = (xi,yi) QUANTUM OF SHIPPMENT BETWEEN EXISTING DEMAND(OR SUPPLY) POINT i AND PROPOSED FACILITY = Wi NUMBER OF CANDIDATES FOR THE PROPOSED FACILITY = m INDEX USED FOR THE CANDIDATES OF PROPOSED FACILITY = j COORDINATES OF CANDIDATE j IN THE GRID MAP = (Xj , Yj ) DISTANCE BETWEEN AN EXISTING DEMAND(OR SUPPLY)POINT i AND A CANDIDATE j FOR THE PROPOSED FACILITY IS GIVEN BY Dij = *(xi Xj)2 +(yi Yj )2 ] LOAD DISTANCE, LDj FOR A CANDIDATE j FOR A PROPOSED FACILITY IS GIVEN BY : LDj = (Dij ) . Wi

UNIT II

Q. VOLTAS A MANUFACTURER OF AIR CONDITIONERS, CURRENTLY PRODUCES ITS COMPRESSORS AT THREE DIFFERENT LOCATIONS : PLANT-A, PLANT-B, AND PLANT-C. RECENTLY MANAGEMENT DECIDED TO BUILD ALL COMPRESSORS IN A SEPARATE DEDICATED FACILITY, PLANT-D. USING THE CENTROID METHOD AND THE INFORMATIONS DISPLAYED IN TABLE-1 AND TABLE-2, DETERMINE THE BEST LOCATION FOR PLANT-D. Table-1 : Plant location Table-2 : Qty. of compressors matrix required by each plant
PLANT A B C CORDINATES (150,75) (100,300) (275,380) PLANT A B C COMPRESSORS REQD. PER YEAR 6000 8200 7000

UNIT II TRANSPORTATION METHOD OF LINEAR PROGRANNING THE TRANSPORTATION METHOD IS A SPECIAL LINEAR PROGRAMMING METHOD. IT IS APPLIED TO PROBLEMS INVOLVING TRANSPORTING PRODUCTS FROM SEVERAL SOURCES TO SEVERAL DESTINATIONS. THE TWO COMMON OBJECTIVES OF SUCH PROBLEMS ARE EITHER : MINIMIZE THE COST OF SHIPPING n UNITS TO m DESTINATIONS, OR MAXIMIZE THE PROFIT OF SHIPPING n UNITS TO m DESTINATIONS. Data for US Pharmaceutical Transportation Problem
SHIPPING COSTS PER CASE (IN DOLLARS) FACTORY SUPPLY WARE HOUSE COLUMBUS ST.LOUIS DENVER LOS ANGELS DEMAND FROM TO COLUMBUS $25 $55 $40 $30 TO ST.LOUIS $35 $30 $50 $40 TO DENVER $36 $25 $80 $66 TO LOS ANGELS $60 $25 $90 $75

INDIANAPOLIS PHOENIX NEW YORK ATLANTA

15 6 14 11

10 12 15 9

INDIANAPOLIS PHOENIX NEW YORK ATLANTA