2. PRODUCT DESIGN
The process of defining all of the
product characteristics
Product design defines a product’s
characteristics of:
Materials,
Appearance,
Dimensions,
Tolerances, And
Performance Standards.
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3. PRODUCT DESIGN –
PROCESS
1. Idea Development
2. Product Screening
3. Preliminary Design and
Testing
4. Final Design
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4. IDEA DEVELOPMENT
Someone thinks of a need and a
product/service design to satisfy it’s
customers, competitors, etc.,
All products begin with an idea whether from:
◦ customers,
◦ competitors or
◦ suppliers
Idea developments selection affects
◦ Product quality
◦ Product cost
◦ Customer satisfaction
◦ Overall manufacturability – the ease with which the product
can be made
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5. PRODUCT SCREENING
Every business needs a
formal/structured evaluation process:
fit with facility and labor skills, size of
market, contribution margin, break-
even analysis, return on sales
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7. FINAL DESIGN
Final design based on test
results, facility, equipment,
material, & labor skills defined,
suppliers identified
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8. FACTORS INFLUENCING
Requirements of customers.
Availability and access to facilities.
Type and quality of raw-materials
Cost to price ratio.
Quality standards.
Availability of plant and machineries.
Substitutes
Reputation or goodwill of.
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9. ISSUES
LEGAL ISSUES
PRODUCT LIABILITY
Product liability is the area of law in which
manufacturers, distributors, suppliers,
retailers, and others who make products
available to the public are held responsible
for the injuries those products cause.
INTELLECTUAL PROPERTY
Intellectual property (IP) is a legal concept
which refers to creations of the mind for
which exclusive rights are recognized.
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10. ETHICAL ISSUES
Assessing the impact of Design on
consumer
Protection of Intellectual property
Privacy
Exposure to undesirable elements
Advertising of designs
Right to alter natural order
Whether design should be tested on
Animals and humans
Sustainable Technology
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11. ENVIRONMENTAL ISSUES
Greenhouse effect for Global warming
Ozone layer depletion
Tropical Deforestation
Water pollution
Resource consumption
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12. PRODUCT SCREENING -
TOOL
BREAK EVEN ANALYSIS
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Computes the quantity of goods company
needs to sell to cover its costs
QBE = F/ (SP - VC)
QBE – Break even quantity
F – Fixed costs
SP – selling price/unit
VC – Variable cost
14. Break-Even Analysis
Compute quantity of goods that must be
sold to break-even
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
Sensitivity analysis can be done to
examine changes in all of the
assumptions made
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15. PROCESS
Process is the Set of activities that taken
together to produce a result of value to
the customer.
PROCESS PLANNING – STEPS:
1. GOAL SETTING:
2. DEVELOPING THE PLANNING PREMISES:
3. REVIEWING LIMITATIONS:
4. DECIDING THE PLANNING PERIOD:
5. FORMULATION OF POLICIES AND STRATEGIES:
6. PREPARING OPERATING PLANS:
7. INTEGRATION OF PLANS:
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17. PROCESS SELECTION
INTERMITTENT PROCESSES:
Processes used to produce a variety
of products with different processing
requirements in lower volumes.
(such as healthcare facility)
REPETITIVE PROCESSES:
Processes used to produce one or a
few standardized products in high
volume. (such as a cafeteria, or car
wash) 17
19. PROCESS SELECTION -
CONSIDERATIONS
1. Product-Process Grid
2. Make or Buy
3. Flexibility of resources
4. Mix between capital & human
resources
5. Degree of customer contact
6. Integration
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20. Other Factors
Make or Buy- A firm’s Make-or-Buy
choices should be based on the
following considerations:
◦ Strategic impact
◦ Available capacity
◦ Expertise
◦ Quality considerations
◦ Speed
◦ Cost
Vertical integration refers to the degree
a firm chooses to do processes itself-
raw material to sales. Backward Integration
means moving closer to primary operations.
Forward Integration means moving closer to
customers
21. Product Life Cycle
Series of changing product demand Consider product life
cycle stages
◦ Introduction
◦ Growth
◦ Maturity
◦ Decline
Facility & process investment depends on life cycle
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22. Tasks or operations
Examples: Giving an
admission ticket to a
customer, installing a
engine in a car, etc.
Decision Points
Examples: How much
change should be
given to a customer,
which wrench should
be used, etc.
PROCESS DESIGN- FLOWCHART SYMBOLS
23. Examples: Sheds,
lines of people waiting
for a service, etc.
Examples: Customers
moving to a seat,
mechanic getting a
tool, etc.
Storage areas or
queues
Flows of
materials or
customers
24. Linking Product Design &
Process Selection
Product design and process selection are
directly linked
Type of product selected defines type of
operation required
Type of operation available defines broader
organizational aspects such as
◦ Equipment required
◦ Facility arrangement
◦ Organizational structure
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25. Linking Product Design &
Process Selection con’t
Impact of Product Life Cycle:
Intermittent and repetitive operations
typically focus on producing products in
different stages of the product life cycle.
Intermittent is best for early in product
life; repetitive is better for later when
demand is more predicable.
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26. Linking Product Design &
Process Selection, con’t
Impact of Competitive Priorities:
Intermittent operations are typically
less competitive on cost than
repetitive operations. (Think “off the
rack” vs. custom tailored clothing.)
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27. Linking Design & Process Selection: Summary
Organizational Decisions appropriate for different types of operations
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29. Process Performance Metrics
Process performance metrics –
defined: Measurement of different
process characteristics that tell us how a
process is performing
◦ Determining if a process is functioning
properly is required
◦ Determination requires measuring
performance
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30. Metrics Example:
At Zelle’s Dry Cleaning, it takes an
average of 3 ½ hours to dry clean &
press a shirt, with value-added time
estimated at 110 min. Workers are paid
for a 7-hour workday but work 5 ½
hr/day, accounting for breaks and lunch.
Zelle’s completes 25 shirts per day,
while the industry standard is 28 for a
comparable facility.
31. Solution
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Process Velocity = (Throughput Time)/(Value-added time)
= (210 minutes/shirt)/(110 minutes/shirt) = 1.90
Labor Utilization = (Time in Use)/(Time Available)
= (5 ½ hr)/(7 hr) = .786 or 78.6%
Efficiency = (Actual Output)/(Standard Output)
= (25 shirts/day)/(28 shirts/day) = .89 or 89%
32. Design of Services
Service design is unique in that the service
and entire service concept are being
designed
◦ must define both the service and concept
- Physical elements, aesthetic &
psychological benefits
e.g. promptness, friendliness, ambiance
◦ Product and service design must match the
needs and preferences of the targeted customer
group
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33. Designing Services vs
Products?
Services are different from
manufacturing as they;
◦ Produce intangible products
◦ Involve a high degree of customer contact
Type of service is classified according
to degree of customer contact
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34. Service Design Matrix
Service Characteristics
◦ Pure services
◦ Quasi-Manufacturing
◦ Mixed services
Service Package
◦ The physical goods
◦ The sensual benefits
◦ The psychological benefits
Differing designs
◦ Substitute technology for
people
◦ Get customer involved
◦ High customer attention
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35. WORK STUDY
Work Study is a systematic
examination of the methods
or activities carried out
during transformation of
inputs into outputs.
36. Objectives
Analyze existing process
Optimum utilization of men and material
resources
Set standards for production
Improve productivity develop effective work
methods
Increase work values
Bring in Ergonomics
Plan incentives
Implement safety measures
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37. Applications
Work Study Helps In Building
Better Transportation Models,
Better Process,
Better Supply Chain Systems,
Integrate Other Functions,
Implement New Technologies,
Better Working Environment, Etc.,
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39. Method Study
Method Study deals with the
different tasks and
techniques used to perform
an activity hat convert input
into outputs.
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40. Objectives
Analyze existing process
Optimum utilization of men and material
resources
Set standards for production
Improve productivity develop effective work
methods
Derive new methods
Increase work values
Bring in Ergonomics
Plan incentives
Implement safety measures
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41. Method Study - Procedure
Select the work to be studied
Record all relevant information's
Analyze the recorded facts – Purpose,
time, person, means etc.,
Develop new methods oto perform the
tasks
Install and equip people resources
Control and Maintain
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42. WORK MEASUREMENT
A systematic determination through the
use of various techniques to analyze
the effectiveness of physical and
mental work in terms of work time in a
specific task.
WORK MEASUREMENT studies the time
taken for an established employee to carry
out a work task, It assists in calculating the
total cost of a good manufactured
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43. Objectives
Determine time required to perform a job
Determine the man power required to
perform a job
Determine the materials and equipments
required to perform a job
Determine actual inventory
Estimate actual lead time
Plan labour incentives
Establish effective labour control
Establish standards of performance
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45. Time Study
A technique for recording the time of
working activities of a specialized work
carried out under specified conditions
and determining the time required for
carrying out the work at desired level
of performance
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46. Time Study - Procedure
Define the purpose ofm study
Study the excising methods, processes, etc.,
Study the time involved
Record the information
Observe the actual time
Estimate normal and standard time
Determine allowances
Norma time = Basic Time * Performance
Rating
Standard Time= Norma Time + Allowances
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47. Elements
Basic Time – Actual or observe time to perform
one element of an activity
Performance Rating – Actual performance of an
operator at different periods of time
Allowances – Additional time provided for delays
at the work place
Standard Time – Total time taken to completing
the activity of a work
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48. Work Sampling
Work Sampling is a method of finding time of
delay and work element to the total process
by random observations.
A technique in which a large number of observations
are made over a period of time with a group of
machines, processes or workers. Each observation
records what is happening at that instant and the
percentage of observations recorded for a
particular activity or delays is the measure of
percentage of time during which that activity of
delay occurs
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49. Motion Study
Deals with the quantity of physical movement
of human , material and machine assets
within th e manufacturing plant
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50. Productivity
Productivity is a economic measure of
output per unit of input. Inputs
includes men, money, machine,
energy and materials while output is
typically measured in terms of
revenues and other components.
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52. How to calculate Productivity
Productivity = Total Output / Total Input
Labour Productivity = Total Output / Total Input in
Labour Hrs
Capital Productivity = Total Output / Total Capital
Input
Material Productivity = Total Output / Total Material
Input
Energy Productivity = Total Output / Total energy
input 52
