MBA 8452 Systems and Operations Management Product Design & Process Selection — Manufacturing
Introduction to Operations Management/ Operations Strategy Process Analysis and Design Project Management Process Analysis Planning for Production Process Control and Improvement Capacity Management Quality Management Aggregate Planning Job Design Just in Time Manufacturing Layout/ Assembly Line Balancing Services Statistical Process Control Scheduling Inventory Control Supply Chain Management Waiting Line Analysis 2
Objective: Manufacturing Design n Describe the Manufacturing Process Categories n Explain The Product-Process Matrix n Describe the Changes in Process Design n Calculate Break-Even Analysis 3
Product Design Process n Concept Development n Product Planning n Detailed Engineering n Engineering Release (Sign-Off) 4
Improving Product Design: Concurrent Engineering n Definition l n cross-functional coordination, integration, and simultaneous development of product Benefits l l l reducing time to market decreasing cost improving quality and reliability 5
Traditional Design vs. Concurrent Design Traditional design: walls between functional areas customers Marketing Design Engineers Manuf. Engineers Production Concurrent design: break down the walls between functional areas 6
Improving Product Design: Quality Function Deployment n n n Translate the “voice of the customer” into technical design requirements Use interfunctional teams from marketing, engineering, and manufacturing Basic tool--House of Quality 7
House Of Quality 5. Tradeoff Matrix Importance 3. Product characteristics 1. Customer requirements 4. Relationship matrix 2. Competitive assessment 6. Technical assessment and target values 8
Correlation: t. Negative Strong negative X * Water resistance 3 Cu s Energy needed to open door to Check force on level ground Customer Requirements Engineering Characteristics nc e X X Door seal resistance po rta Positive X X Energy needed to close door Im 5 Strong positive X Accoust. Trans. Window House of Quality: An Example Competitive evaluation X = Us A = Comp. A B = Comp. B (5 is best) 1 2 Easy to close X Stays open on a hill 5 Easy to open 3 Doesn’t leak in rain 3 No road noise 2 4 5 X AB AB 2 XAB A XB 4 10 Importance weighting 6 6 X A 9 2 3 B Relationships: 4 3 2 1 A X B B A A BXA Medium = 3 BA X Small = 1 X X Maintain current level Technical evaluation (5 is best) B Maintain current level 5 Reduce energy to 7. 5 ft/lb. 6 Reduce force to 9 lb. Target values Maintain current level Strong = 9 Reduce energy level to 7. 5 ft/lb 1 7 3 9
Improving Product Design: Design for Manufacture & Assembly n Value Analysis/Value Engineering (VA/VE) l n focus on the ratio of value to cost Guidelines l Simplification (fewer parts) l Standardization (more standard parts) l Modular design (combining parts) 10
Types of Processes Project Assembly line Job shop/Batch production Continuous process 11
Product - Process Matrix Product Characteristics One-of-a Kind Type of Process Project Low Vol Low Std High flexibility & unit cost Movie production Job Shop Printing shop Fast food restaurant Batch Auto assembly Assembly Line Continuous Multiple Limited Products High Volume High Demand Low flexibility & unit cost Oil, sugar refinery 12
Process Selection Break-even Analysis n Single Process--Adopt it or not? l Break-even point: Profit=0 ------> demand. BE=? n Two Processes--Which one is better? l Cross-over point: Profit 1=Profit 2 ------> demand. CO=? 13
Break-even Analysis Example--I Tom Smith, a recent graduate of GSU, has just formed a company called the New Age Surf to provide high speed internet access with a competitive price of $20 per month. The fixed cost each month is estimated to be $60, 000. Unit cost for each customer is approximately $10 per month. How many customers must be attracted in order to break even? 14
Break-even Analysis Example--II Suppose now Tom is given another option. Instead of purchasing equipments, he can rent them from other companies. This will reduce the monthly fixed cost to $20, 000. But unit cost for each customer will be $15 per month. What option should Tom adopt? 15
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