Chapter 4 Flashcards
Describe how process selection decisions have strategic implications.
Depending on the product you will choose what type of process to choose (Project, Job Shop, Batch, Assembly line, Continuous) These are listed by Unique-One-Of-Kind to High Volume, High Standardization.
Compare and contrast the five types of product flow.
Project- Such as a house. it is unique and one of a kind.
Job Shop- Low Volume, Low Standardization/High Flexibility. Higher cost than Batch. i.e. Printing.
Batch- Low Volume, Multiple Products. Uses General Purpose equipment. Jumbled flow.
Assembly Line- Higher Volume, Few major products.
Continuous - High Volume, High Standardization, commodity
What are the capital and labor requirements for these different product flow choices?
Project-Medium Capital investment, Little inventory, General purpose equipment. High Labor skills, Non-routine tasks, High pay.
Job Shop/Batch- Medium Capital investment, High Inventory, General purpose equipment. High Labor Skills, Non-routine, high pay.
Assembly Line/ Continuous- High capital investment, Low inventory, Special Purpose Equipment. Low Labor Skills, Repetitive tasks, medium pay.
How is throughput ratio calculated and why is it important?
TR= (Total processing time for job/ Total time in operations) *100
one way to measure the efficiency of a process. represents the proportion of time in ops during which value is actively being added to the job.
total processing time / total time in operations
total process time for job excludes wait time
low percent= product spends alot of time waiting to be processed
When does make-to-stock make sense? What is the MTS process?
Faster Service, Lower Cost Per Unit, Standard Product (not custom)fast, lower cost than mto, produce specifies standard product line, forecasting, future orders and replen, service level and efficiency
What are the main differences between make-to-stock and make-to-order?
MTS = producer spec, low variety, cheap MTO= customer spec, high variety, expensive
What are the main considerations in selecting the appropriate process?
MTO- is being made for specific customer in mind. The process doesn’t start until the order is made.(Customer specified, high variety, expensive)
MTS- Orders are forecast and produced in advance with little customization. They are stored until being ordered. (Producer-Specified, low variety, inexpensive)
ATO- Hybrid of the two above. build parts in advance and assemble upon customers requests. Advantage is variety with no additional costs
Describe the product-process matrix and how it works.
Moves right to left with levels of uniqueness to very standardized. and from top to bottom with Projects to Continuous. The Graph shows a arrow going from top left to bottom right. Indicating that continuous could never be unique and project could never be High Volume
Explain how and why process decisions are cross-functional.
process selection decisions are highly cross functional in nature because they affect human resources, capital , information systems, and the ability of the firm to deliver products ot the market. therefore all functions should be knowledgeable about process choices and the impact of process selection on their particular functional area and the environment
What are reasons for pursuing a focused operations strategy?
focused ops are used to separate products and processes that have different requirements in terms of the production process or the markets served. each type of process or product family should be assigned to a different facility or plant within a plant
What is meant by mass customization? What’s necessary to do this?
a strategy to provide products in lot sizes of one in high volume. providing customized products at the same cost as mass production. cross functional integration is a key enabler. depends on economies of SCOPE. 3 forms of mass customization- modular production and ATO,, fast changeover (zero set up time between orders), postponement (defer a portion of the production until the pt of deliver)
What is the difference between economies of scale and economies of scope?
Economies of Scale- focuses on producing standardized products in high volume to reduce cost per unit.
Economies of Scope - Focuses on Mass Customization. This uses tactics such as Modular Productions (Using same parts to make different products), Assemble to Order (Produce the product to customer specs after being ordered), Fast Changeover (No set up time for next batch or different product) and Postponement (Produce large volumes of standardized products then add custom features at the end to meet customer requirements.)
