Determinants of Manufacturing Environments

Engineer-to-order (ETO)
Make-to-order (MTO)
Assemble-to-order (ATO)
Make-to-stock (MTS)
Mass customization
Determinants of Manufacturing Environments

Lead time expectations

Product design input from customers
Product volume and variety
Product life cycle
Lead Time and Manufacturing Environments

ETO delivery lead time Engineer-to-

order
Design Purchase Manufacture Assemble Ship

MTO delivery lead time

Make-to-order
Inventory Manufacture Assemble Ship

ATO delivery lead time Assemble-to-

order
Manufacture Inventory Assemble Ship
MTS delivery
lead time Make-to-stock
Manufacture Assemble Inventory Ship
Volume and Variety Relationships

High
Engineer-to-order
Mass
customization
Product variety

Make-to-order

Assemble-to-order

Make-to-stock

Low High
Product volume
Product Life Cycle

Units
sold Time

Introduction Growth Maturity Decline Phase-out

Product Life Cycle and Manufacturing Environments

Units
sold Time

Introduction Growth Maturity Decline Phase-out

ETO

MTO

ATO

MTS

Mass customization
Choice of Processes and Layouts

Intermittent
Flow
– repetitive/line
– continuous

Project
Intermittent Manufacturing
Intermittent Manufacturing Characteristics

Intermittent lot or batch production

Work moves only to required stations
Many different parts processed at workstations
General-purpose machinery
Relatively easy to change product or volume
Complex and expensive production and inventory control
High WIP inventory levels; long lead time
Intermittent Manufacturing Layout

Intermittent manufacturing layout is called process layout.

It also is called functional or job shop layout.
Equipment and operations are grouped together by functional
specialty.
There are similar types of skills and equipment in each
department.
Volume is not high enough to justify assembly line.
Flow Manufacturing

Workstations are in the sequence needed to make the

product.
Work flows at a nearly constant rate.
There is little WIP inventory.
Flow Manufacturing Characteristics

Layout is called product layout.

There are fixed routings and dedicated machinery.
The process is capital intensive.
There are two types of flow: repetitive (line) and continuous.
Repetitive produces discrete units, such as cell phones and
automobiles.
Continuous produces non-discrete products, such as liquids.
There is a limited range of similar products.
High product volumes occur.
Advantages of Product Layout

Little WIP inventory

Short throughput and manufacturing lead times
Lower unit cost
Project Manufacturing

Used for large, complex projects

Project remains in one location for assembly
Product made at one site
Avoids cost of moving the product