Classification of Production Systems

Classified based on production processes:

Production systems
Gestione Strategica delle Organizzazioni
Prof. Moreno Muffatto 2011-2012

Continuous flow production system Discrete production system

Classified based on market relationship:

make to stock produce to order

Classified based on industry:

manufacturing industry service industry

4 basic type production Systems System Job Shop Batch Processing Flow Shop (Production Line) Continuous Flow Example Commercial Printer

Job Shop
Output

Product 1 Heavy Equipment Car Assembly Sugar Refinery

Input

Product 2

A C

B D

Most Processes are some where between Job shop and Flow shop

Job Shop

Flow Shop

Functional layout or Process layout

low volume, high variety customized products flexible resources skilled human resources jumbled work flows high material handling large of inventories long flow time highly structured information system high cost per unit of product but low investment

Product 1
Input

A D B
Output

Product 2

C B A

Flow Shop

Continuous Flow Production System

Product layout or line layout Discrete flow shop: assembly line Continuous flow shop: beverage, chemical plant, process plant. high standardization, high speed low material handling short flow time low unit-processing costs high investment cost; needs mass production. special purpose equipment, and low skilled labor prevent flexibility

Characteristics 1. The production process is relatively steady. 2. Customers are usually organizations (including commercial organization) , few customer sorts 3. The standardization of products is high 4. Few product sorts 5. The facility is highly automated, highly specialized and expensive 6. The facility failure can bring in great loss, so the equipment maintenance is very important

Continuous Flow Production System

Discrete Production System

Discrete products, affected by customers greatly, the markets is not so steady. The construction of products is complex, many parts and components. Production process is required to cooperate with many departments. Short product life cycle, products are changed quickly (since customers demands change continually). High customization proportion Production and operations management are complex.

industries: Chemistry industry, plastics, pharmacy, chemical fertilizer, fossil oil, metallurgy, beverage.

Difference between Continuous Flow and Discrete Production

Differences
Primary characteristic
Continuous flow
Capital high fewer low high low low easy

Discrete
Workforce comparatively low many low high low high high difficulty

Primary characteristic Customer amount Product sorts Product standardization Customization Demand

Continuous flow few few high low steady

Discrete many many low high changing

Key production elements Automation level the types of material WIP product inventory output flexibility product structure flexibility operation information collecting

Discrete Production System

Mass Production
Only one or a few types of products are produced repeatedly in a long period.

Discrete production systems

Mass production Multi-products and low volume production One of a kind production

Characteristics
High productivity: workers are designated to a work with high specialization, and also equipments and process are high specialized. Skilled workers: workers repeat the same operations Simple production planning and scheduling: once a production line is set up properly, it will keep going on some rhythm. The products quality is easy to be guaranteed. Low production cost.

Management emphasis: facility maintenance; worker management; and quality management

Multi-product and Low Volume Production

Characteristic Low volume, low production stability The high productivity special equipments can not be used There are many products in production at the same time so that the management is very complex. Management Emphasis Optimize product mix to pursue the largest economic benefits while satisfying the market demand and production resources constraints. Improve the connection between processes. Arrange reasonably the product kind, quantity and interval to produce products in batches and in turns. Control and balance WIP, logistic and product inventory

One of a Kind Production

Start to organize production after receiving order. e.g. shipbuilding, airplane making, generating electricity equipment Characteristics many kind of products, different kind needs different production process. every order has only one or several quantity, with difference delivery time. general equipments are required, which need a long adjustment period with low efficiency to different product workers are also required to be generalists.

ABC Analysis in Production System Design

Matching Process and Product Life Cycles The Process Life Cycle three major stages of the manufacturing process life cycle Early stage-job shop; a varied mix of relatively lowvolume orders; being responsive to changes in the product design; Middle stage-some automation; batch process and some transfer lines (assembly lines); more control over suppliers; unit cost decline; Last stage-automated process and standardized production process; continuous flow operation. Variety

Volume

Flow Shop

Batch Productio n

Job Shop

The Product-Process Matrix (PPM)

The Product-Process Matrix (PPM)

The Four Phases in product Life Cycles in term of production volume and the number of product types

The Four Stages in the evolution of the manufacturing process in term of process structure Job Shop Batch Production Assembly Line Continuous Flow (for process industries)

low volume, one-of-a kind low volume, multiple products fewer majors products, higher volume few products, high volume

Product- Process Matrix

Classified based market relationship

Few Major Product High Volume Highest Volumes Standardized

Low Volume Customized

Multi product Low volume

Job Shop

Printing Shop Apparel

Make to Stock Characteristic: production based on the forecasting mass production, in big batch high product inventory high productivity simple production organization Disadvantage: high risk of excess inventory or out of stock

Opportunity costs

Batch

Assembly Line

Auto Assembly

Continuous

More costs

Oil Refinery

Produce to Order
Characteristics: produce based on the order different product has different specification, quantity, quality and delivery time nearly zero inventory delivery time is the key multi-product and low volume production complex production organization and management high customer satisfaction According to the level of customization, it can be further classified into assembly to order, make to order and engineer to order.

Assembly to Order (ATO)

First produce semi-finished products in advance, Then assemble them into different products according to customer order. e.g. automobile manufacturing The most mature production mode, the production of parts and components are like make to stock with following properties: high standardization and generalization parts or components big production batch high productivity in many cases, use flow production line

Make to Order (MTO)

All products have been designed in advance Later according to customer orders, buy raw materials and parts, components, and Then manufacture and assembly them into products the customer requires. Some raw materials and standard parts are prepared based on the forecasting Forecasting should be paid great attention

Engineer to Order (ETO)

First design products according to customers requirement after receiving order, then purchase, and then make them. Long production cycle Pay more attention to reducing design cycle Standard and general parts should be used as much as possible

Product Type and Production Batch

order

Engineer to Order, ETO Make to Order, MTO order Assembly to Order, ATO order Make to Stock, MTS order

delivery

many MTO Product type ETO few MTS ATO

design

purchase

manufacture

assembly delivery

small Production batch

large

Auto Industry
High custom High unit margin Low volume Process Flexible Shop
All mfgers at the beginning

Auto Industry
Product Low custom Low unit margin High volume High custom High unit margin Low volume
All mfgers at the beginning

Product

Process Flexible shop

Low custom Low unit margin High volume

Rigid flow

Rigid flow

Ford Model T Baton Rouge plant

Auto Industry: process & variety

High custom High unit margin Low volume Process Flexible shop
All mfgers at the beginning

Auto Industry: introducing flexibility into the process

Low custom Low unit margin High volume High custom High unit margin Low volume All mfgers at the beginning GM Multibrand strategy
Ford Model T Baton Rouge plant

Product

Product

Process Flexible shop

Low custom Low unit margin High volume

GM Multi-brand strategy

Rigid flow

Rigid flow

Toyota Just-in-time

Ford Model T Baton Rouge plant

Auto Industry: mass customisation

High custom High unit margin Low volume All mfgers at the beginning Product Low custom Low unit margin High volume

Process Flexible shop

GM Multibrand strategy Rigid flow

Toyota Just-in-time

Ford Model T Baton Rouge plant