Process Strategy

1. PRESENTATION
ON
PROCESS STRATEGY

2. PRESENTED BY
Hira Islam
Tuhin Parves
Miad Hossain Prince
Farah Amira Khan
Anoare Hossain
ID:B3160B016
ID:B3160B005
ID:B3160B022
ID:B3160B025
ID:B3160B036

3. 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

4. Effect
• Production efficiency
• Product & volume flexibility
• Cost & quality

5. .
.

6. 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

7. Example

8. Process-Focus Examples

9. 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%)

10. 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

11. Repetitive Focus - Examples

12. Example

13. 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

14. Production Process at NUCOR Steel

15. 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

17. 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

18. EXAMPLE

19. Comparison of Processes
Process Focus
(Low volume,
high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume,
low-variety)
Mass
Customization
(High-volume,
high-variety)
Small quantity,
large variety of
products
Long runs,
standardized
product made
from modules
Large quantity,
small variety of
products
Large quantity,
large variety of
products
General purpose
equipment
Special
equipment aids
in use of
assembly line
Special purpose
equipment
Rapid
changeover on
flexible
equipment

20. Comparison of Processes(contd)
Process Focus
(Low volume,
high variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-
variety)
Mass
Customization
(High-volume,
high-variety)
Operators are
broadly skilled
Employees are
modestly trained
Operators are less
broadly skilled
Flexible operators
are trained for the
necessary
customization
Many job
instructions as
each job changes
Repetition
reduces training
and changes in
job instructions
Few work orders
and job
instructions
because jobs
standardized
Custom orders
require many job
instructions

21. Comparison of Processes(Contd)
Process Focus
(Low volume, high
variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-
variety)
Mass
Customization
(High-volume,
high-variety)
Raw material
inventories high
JIT procurement
techniques used
Raw material
inventories are low
Raw material
inventories are low
Work-in-process is
high
JIT inventory
techniques used
Work-in-process
inventory is low
Work-in-process
inventory driven
down by JIT, lean
production

22. Comparison of Processes
Process Focus
(Low volume, high
variety)
Repetitive Focus
(Modular)
Product Focus
(High-volume, low-
variety)
Mass Customization
(High-volume, high-
variety)
Units move slowly
through the plant
Movement is
measured in hours
and days
Swift movement of
unit through the
facility is typical
Goods move swiftly
through the facility
Finished goods
made to order
Finished goods
made to frequent
forecast
Finished goods
made to forecast and
stored
Finished goods often
made to order

23. Crossover Charts
Fixed costs
Variable
costs
$
High volume, low variety
Process C
Fixed costs
Variable
costs$
Repetitive
Process B
Fixed costs
Variable
costs$
Low volume, high variety
Process A
Fixed cost
Process A
Fixed cost
Process B
Fixed cost
Process C
V1 V2
Volume
$
Fixed costs
Variable
costs$
Repetitive
Process B
Fixed costs
Variable
costs$
Low volume, high variety
Process A
Product A
Product B
Product C
Volume
$
A chart of costs at the
possible volumes for
more than one process.
The comparison of
processes can be further
enhanced by looking at
the point where the
total cost of the process
changes.

24. Total
Fixed cost
200,000
300,000
400,000
Dollars required per
accounting report
60
25
10
Software A
Software B
Software C
Approach: Solve for the crossover point for software A and B and then the crossover
point for Software B and C.

25. Solution:
200,000+(60)v1 = 300,000+(25)v1
35v1 = 100,000
v1 = 2,857
For V1,
For V2,
300,000+(25)v2 = 400,000+ (10)v2
15v2 = 100,000
v2 = 6,666
A 200,000 60
B 300,000 25
C 400,000 10

27. Changing Processes
 Difficult and expensive
 May mean starting over
 Process strategy determines
transformation strategy for an
extended period
 Important to get it right

28. Flow Diagrams

29. A B
Time Function Mapping

30. 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.
Service
Blueprinting
Process
Points of Contact
Evidence

31. Process Charts
 To understand.
 To study
 To communicate.
 To document a process.
 When planning a project.

32. Operation
Inspection
Transport
Storage
Delay

33. We can define the service process as the way in which a company works so that a customer
receives service.
The Service Process Design
1. Line operations.
2. Job Shop Operations.
3. Intermittent Operations.

34. Degree of Customization
Low
Low
High
High
DegreeofLabor
Customer Interaction & Process Design
Mass
Service
Professional
Service
Service
Factory
Service
Shop

35. • Production Technology
• Process Redesign
• Ethics and environmentally
friendly process

36. Production Technology
• Advances in technology that enhance production
and productivity have a wide range of applications
in both manufacturing and services.

37. 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)

38. 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.
Machine technology
CNC _Computer
numerical control
The machinery with its own computer and memory.
• Perform operations such as_
Cutting , Drilling, Boring,
Milling.
• 21st – five times more
productive

39. 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.

40. Process control
The use of information technology to monitor and
control a physical process.
Used to determine and control
temperatures ,pressures ,
quantities in petroleum
refineries , petrochemical
process , cement plants ,
nuclear reactors and other
product -focused facilities.

41. Vision system
Systems that use video
cameras and computer
technology in inspection roles.
 Food –processing and
manufacturing
organizations.

42. 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.

43. 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.

44. Automated guided vehicles (AGVs)
 Electronically guided and controlled cart used
to move materials.

45. Flexible manufacturing systems (FMSs)
A system that uses an automated work cell controlled by
electronic signals from a common centralized computer
facility.

46. 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.

48. Process Redesign
The fundamental rethinking of business
processes to bring about dramatic
improvements in performance.

49. Financial Services:
Debit cards , electronic fund transfer,
automatic teller machine(ATM), internet
stock trading.
Education
Online newspaper , online journals ,
interactive assignments via Web CT and
Blackboard.
Utilities and government
Technology’s Impact on Services
Automated one-man garbage trucks,
optical mail and bomb scanners, flood
warning systems.

50. Restaurants and foods
Communications
Hotels
Wholesale/Retail trade
Wireless orders from waiters to the kitchen,
robot butchering, transponders on cars that
track sales at drive- through.
Electronic publishing, interactive TV
Electronic check-in/check-out, electronic
key/lock
System.
Use of ATM-like kiosks , Point-of-sale (POS)
terminals, e-commerce, electronic
communication between store and supplier, bar
coded data.

51. Transportation
Health care
Airlines
Automatic toll booths, satellite-directed
navigation systems.
Online patient-monitoring, online medical
information systems, robotic surgery.
Ticketless travel, scheduling, Internet
purchases.

52. 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.

53. British cosmetic

54. Effective operations managers understand how to use
process strategy as a competitive weapon.