Topic selection, Layout selection and Decision making

Manufacturing and process selection

1. Process Selection - Manufacturing Eng. Uditha Wijayaratne B.Sc. (Eng.) Hons, ACMA (UK), CGMA, ACCA (UK), MBA (PIM-SJP), AMIESL (SL)

2. Contents Types of Processes Process Flow Structures Product - Process Matrix Process Flow Design Break-Even Analysis

3. Types of Processes Conversion (Iron to steel) Fabrication (Cloth to clothes) Assembly (Parts to components) Testing (For quality of products)

4. Selection of Process

5. Process Flow Structures Job shop Production of small batches of a large number of different products, most of which require a different set or sequence of processing steps Tailors shop, Airplane manufactures (Copy center making a single copy of a student term paper)

6. Process Flow Structures Batch shop Some what standardized job shop Cosmetics manufacturing (Copy center making 10,000 copies of an ad piece for a business)

7. Process Flow Structures Assembly Line Production of discrete parts moving from workstation to workstation at a controlled rate, following a sequence needed to build the product Manual assembly of toys / appliances (Automobile manufacturer)

8. Process Flow Structures Conversion or further processing of undifferentiated materials (Petroleum manufacturer) Continuous Flow

9. Product - Process Matrix IV. Continuous Flow III. Assembly Line II. Batch I. Job Shop Low Volume, One of a Kind Multiple Products, Low Volume Few Major Products, Higher Volume High Volume, High Standard- ization Commercial Printer Heavy Equipment Automobile Assembly Sugar Refinery Flexibility (High) Unit Cost (High) Flexibility (Low) Unit Cost (Low) These are the major stages of product and process life cycles

10. Process Flow Design A process flow design can be defined as a mapping of the specific processes that raw materials, parts, and subassemblies follow as they move through a plant. The most common tools to conduct a process flow design include assembly drawings, assembly charts, and operation and route sheets.

11. Assembly Drawings

12. Assembly Charts

13. Process Analysis Process - a set of tasks that transform inputs in to useful outputs A process usually consists of a set of tasks, a flow of material and information that connect the set of tasks, and storage of materials and information.

14. Process Flow Chart Material Received from Supplier Inspect Material for Defects Defects found? Return to Supplier for Credit Yes No , Continue…

15. Break-Even Analysis A standard approach to choosing among alternative processes or equipment. Model seeks to determine the point in units produced (and sold) where we will start making profit on the process or equipment. Model seeks to determine the point in units produced (and sold) where total revenue and total cost are equal.

16. Example 1 Suppose you want to purchase a new computer that will cost $5,000. It will be used to process written orders from customers who will pay $25 each for the service. The cost of labor, electricity and the form used to place the order is $5 per customer. How many customers will we need to serve to permit the total revenue to break-even with our costs?

17. Example 1 Break-even Demand: = Total fixed costs of process or equip . Unit price to customer – Variable costs =5,000/(25-5) =250 customers

18. Example 2 Suppose a manufacturer has identified the following options for obtaining a machined part. It can buy the part at Rs 200 per unit, it can make the part on a numerically controlled semiautomatic lathe at Rs. 75 per unit, or it can make the part on a machining centre at Rs. 15 per unit. There is negligible fixed cost if the item is purchased; a semiautomatic lathe costs Rs. 80,000 and a machining centre costs Rs. 200,000. The selling price of the product is Rs. 300.

19. Question Bowl What is the break-even in demand for a new process that costs $25,000 to install, will generate a service product that customers are willing to pay $500 per unit for, and whose labor and material costs for each unit is $100? 400 units 250 units 100 units 62.5 units None of the above Answer: d. 62.5 units (25,000/(500-100)=62.5)

20. Summary Types of Processes Process Flow Structures Product - Process Matrix Process Flow Design Break-Even Analysis