Professional Documents
Culture Documents
Processes and Technology
Processes and Technology
6-1
Lecture Outline
• Process Planning
• Process Analysis
• Process Innovation
• Technology Decisions
• Vertical integration
• extent to which firm will produce inputs and control outputs of
each stage of production process
• Capital intensity
• mix of capital (i.e., equipment, automation) and labor
resources used in production process
• Process flexibility
• ease with which resources can be adjusted in response to
changes in demand, technology, products or services, and
resource availability
• Customer involvement
• role of customer in production process
• Projects
• one-of-a-kind production of a product to customer order
• Batch production
• process many different jobs at the same time in groups or
batches
• Mass production
• produce large volumes of a standard product for a mass
market
• Continuous production
• used for very-high volume commodity products
One-at-a- Few
Type of Mass Mass
customer time individual
market market
customers
Product
demand Infrequent Fluctuates Stable Very stable
Demand Low to
Very low High Very high
volume medium
No. of Infinite
different Many, varied Few Very few
products variety
Repetitive, Continuous,
Production Long-term Discrete, job
system assembly process
project shops
lines industries
Mixing,
Primary type Specialized
of work Fabrication Assembly treating,
contracts
refining
Experts, Limited
Worker skills Wide range Equipment
crafts- range of
of skills monitors
persons skills
Capital
Non-repetitive, Costly, slow, Difficult to change,
Dis- investment;
small customer difficult to far-reaching errors,
advantages lack of
base, expensive manage limited variety
responsiveness
Machine shops, Automobiles,
Construction,
print shops, televisions, Paint, chemicals,
Examples shipbuilding,
bakeries, computers, foodstuffs
spacecraft
education fast food
TR = TC
vp = cf + vcv
vp - vcv = cf
v(p - cv) = cf
cf
v = p - cv
Solving for Break-Even Point (Volume)
Break-even point is
cf 2000
v= = = 40 units
p - cv 100 - 50
Dollars
Total
$3,000 — cost
line
$2,000 —
$1,000 —
Total
revenue
line
40 Units
Break-even point
Operation
Inspection
Transportation
Delay
Storage
Continuous
improvement refines
the breakthrough
Breakthrough
Improvement
Continuous improvement
activities peak; time to
reengineer process
Product Development
Manufacturing
Purchasing
Accounting
Order Fulfillment
Sales
Supply Chain Management
Customer Service
Function Process
Baseline Data
Customer Goals for Process Benchmark
Requirements Performance
Data
Detailed Model
Process Map Validation Key
Performance
Measures
Pilot Study
of New Design