Chapter 4 Process Design

Chapter 4 Process design
Source: Joe Schwarz, www.joyrides.com
Slack, Chambers and Johnston, Operations Management 5th Edition Nigel Slack, Stuart Chambers, and Robert Johnston 2007
Process design
Process design
Supply network design Layout and flow Process technology Operations strategy Operations management
Design
Improvement
Job design
Product/service design
Planning and control
Nature and purpose of the design activity
Products, services and the processes which produce them all have to be designed
Decisions taken during the design of a product or service will have an impact on the decisions taken during the design of the process which produces those products or services, and vice versa
Design of products / services and design of processes are interrelated and should be treated together
Designing the product or service Designing the process
Products and services should be designed in such a way that they can be created effectively
Product / service design has an impact on the process design and vice versa
Processes should be designed so they can create all products and services which the operation is likely to introduce
Design of the Product
Design of the Process
Design of the Service
Design of the Process
In manufacturing operations overlapping the activities of product and process design is beneficial
In most service operations the overlap between service and process design is implicit in the nature of service
Process mapping symbols derived from Scientific Management

Operation (an activity that directly adds value) Inspection (a check of some sort) Transport (a movement of something) Delay (a wait, e.g. for materials)
Process mapping symbols derived from Systems Analysis

Beginning or end of the process
Activity
Input or output from the process
Direction of flow
Storage (deliberate storage, as opposed to a delay)
Decision (exercising discretion)
Designing processes
There are different process types Process types are defined by the volume and variety of items they process
Process types go by different names depending on whether they produce products or services
Manufacturing process types

Process tasks
Diverse/ complex
Process flow High

Intermittent
Project Jobbing
Variety
Batch
Mass Continuous Low Volume High
Repeated/ divided
Continuous
Low
Project processes
One-off, complex, large-scale products with high work content

Specially made, every one customized Defined start and finish: time, quality and cost objectives Many different skills have to be coordinated
A project process with a small part of the process map that would describe the whole process
Jobbing processes
Very small quantities: one-offs, or only a few required

Specially made: high variety, low repetition, strangers, every one customized Skill requirements are usually very broad Skilled jobber, or team, completes whole product
Preparing photolithography materials on a jobbing basis with a typical process map
Batch processes Higher volumes and lower variety than for jobbing Standard products, repeating demand. But can make specials Specialized, narrower skills Set-ups (changeovers) at each stage of production
A batch process in a kitchen together with an illustrative process map
Mass (line) processes Higher volumes than batch
Standard, repeat products (runners) Low and/or narrow skills No set-ups, or almost instantaneous ones
A mass process a packing process
Continuous processes
Extremely high volumes and low variety: often single product Standard, repeat products (runners) Highly capital-intensive and automated
Few changeovers required Difficult and expensive to start and stop the process
Part of a continuous process and a typical process map
Service process types

Process tasks
Diverse/ complex
Process flow
High
Intermittent
Professional service
Variety
Service shop
Mass service
Repeated/ divided Continuous
Low
Low
Volume
High
A professional service Consultants planning how best to help their client
A service shop This health club offers some variety within a standard set of facilities and processes
A mass service This call centre can handle a very high volume of customer enquiries because it standardizes its process
Source: Royal Bank of Scotland Group
Deviating from the natural diagonal on the productprocess matrix has consequences for cost and flexibility
Manufacturing operations process types
Volume Variety
Service operations process types None

More process flexibility than is needed so high cost
Project Jobbing
Professional service
Batch
Mass Continuous
Less process flexibility than is needed so high cost
Service shop
Mass service
None
The natural line of fit of process to volume/variety characteristics
Deviating from the natural diagonal on the productprocess matrix has consequences for cost and flexibility
Volume Variety
None
Old process
Old process, new product
New process, new product
None
Flow (layout), technology and job design are all influenced by process positioning
Flow Unorganized Technology Little / general Jobs Varied / high discretion
Volume
Variety
Custom furniture maker Machine tool maker Automobile factory
None
Predictable
Specialist
Routine / low discretion
None
Petrochemical refinery
Flow (layout), technology and job design are all influenced by process positioning
Flow Unorganized Technology Little / general Jobs Varied / high discretion
Volume
Variety
None
Investment banking Customer service branch Bank call centre Credit card processing
Predictable
Specialist
Routine / low discretion
None
Process mapping symbols derived from Scientific Management

Operation (an activity that directly adds value) Inspection (a check of some sort)
Process mapping symbols derived from Systems Analysis

Beginning or end of the process
Activity
Transport (a movement of something)

Delay (a wait, e.g. for materials)
Input or output from the process
Direction of flow
Storage (deliberate storage, as opposed to a delay)
Decision (exercising discretion)
Customized sandwich old process
Raw materials
Assembly
Stored sandwiches
Move to outlets
Stored sandwiches
Sell
Take payment
Standard sandwich process
Customer request
Customized sandwich old process
Raw materials
Assembly
Take payment
Customer request
The operation of making and selling customized sandwiches

Prepare Sandwich materials and customers Assemble as required Take payment Customers assembled to sandwiches
Bread and base filling Assemble whole sandwich Use standard base? No Yes Customer request Assemble from standard base Stored bases Fillings
Outline process of making and selling customized sandwiches
Detailed process of assembling customized sandwiches
Customized sandwich new process
Assemble whole sandwich Assembly of sandwich bases Use standard base?
No
Fillings
Take payment
Bread and base filling Stored bases
Yes Customer request Assemble from standard base
Flow process charts for processing expense reports at Intel before and after improving the process
1
2 3 4 5 6 Description of activity Report arrives Wait for processing Check expenses report Stamp and date report Send cash to receipt desk Wait for processing 1 2 3 4 5 6 7 8 9
Description of activity Report arrives

Stamp and date report Check expenses report Attach payment voucher Wait for batching Collect retorts into batch Batch to audit desk
Check advance payment 7 8 Send to accounts receivable 9 Wait for processing 10 Check employee record 11 Send to account payable Attach payment voucher 12
13 14 15 16 17 18 19 20 21 22 23 24 Log report Check against rules Wait for batching Collect retorts into batch Batch to audit desk Wait for processing Batch of reports logged
Wait for processing Check reports and vouchers Reports to batch control 10 11 Batch control number Copy of reports to filing 12 Reports filed 13 14 Payment voucher to keying 15
Confirm payment
Totals 5 5 2 2 1
Check payment voucher

Reports to batch control Batch control number Copy of reports to filing
Reports filed 25 Payment voucher to keying 26 Confirm payment Totals 7 8 5 5 1
Littles law (a really quite useful law) Throughput (TH) = Work in process (WIP) Cycle time (CT)
Cycle time = 2 minutes
WIP = 10
Throughput time = ? Throughput time = 10 2 minutes = 20 minutes
Littles law (a really quite useful law)
Throughput (TH) = Work in process (WIP) Cycle time (CT)

500 exam scripts need to be marked in 5 days (working 7 hours a day). It takes 1 hour to mark a script. How many markers are needed? Throughput time = 5 days 7 hours = 35 hours 35 hours = 500 scripts Cycle time Cycle time = 35 hours 500 scripts = 0.07 hours
Number of markers = Work content = 1 hour = 14.29 Cycle time 0.07
Throughput efficiency
Throughput efficiency is the work content of whatever is being processed as a percentage of its throughput time
Throughput efficiency =
Work content Throughput time
100
Arrival Arrival 30 9 515 10 Processing 10 515 Processing frequency frequency 20 time time mins mins mins (demand) (demand) mins
Utilization Utilization = 33.33 50 100 % % %% Utilization= <100 100%

High
Q Q Q = = = 0infinity 0 Q > 0
time Process length of queue Average throughput (or inventory)
High utilization but long throughput times
X
Low utilization but short throughput times
X X
Reduce process variability
80%
Low
20%
40%
60%
100%
Capacity utilization
The relationship between process utilization and number of units waiting to be processed for variable arrival and activity times
Average number of units waiting to be processed Average number of units waiting to be processed High utilization but long waiting time Reduction in process variability Short waiting time but low utilization Y Z X
Decreasing variability
10 20 30 40 50 60 70 80 90 100 Utilization
10 20 30 40 50 60 70 80 90 100 Utilization
(a) Decreasing variability allows higher utilization without long waiting times
(b) Managing process capacity and/or variability
Key Terms Test

Throughput time The time for a unit to move through a process. Utilization The ratio of the actual output from a process or facility to its design capacity. Life cycle analysis A technique that analyzes all the production inputs, the life cycle use of a product and its final disposal in terms of total energy used and wastes emitted.
Key Terms Test

Process types Terms that are used to describe a particular general approach to managing processes. In manufacturing these are generally held to be project, jobbing, batch, mass and continuous processes; in services they are held to be professional services, service shops and mass services.
Project processes Processes that deal with discrete, usually highly customized, products. Jobbing processes Processes that deal with high variety and low volumes, although there may be some repetition of flow and activities.
Key Terms Test

Batch processes Processes that treat batches of products together, and where each batch has its own process route. Continuous processes Processes that are high volume and low variety; usually products made on continuous processes are produced in an endless flow, such as petrochemicals or electricity. Professional services Service processes that are devoted to producing knowledgebased or advice-based services, usually involving high customer contact and high customization. Examples include management consultants, lawyers, architects, etc.
Key Terms Test

Service shops Service processes that are positioned between professional services and mass services, usually with medium levels of volume and customization. Mass services Service processes that have a high number of transactions, often involving limited customization, for example mass transportation services, call centres, etc. Productprocess matrix A model derived by Hayes and Wheelwright that demonstrates the natural fit between volume and variety of products and services produced by an operation on one hand, and the process type used to produce products and services on the other.
Key Terms Test

Process mapping Describing processes in terms of how the activities within the process relate to each other (may also be called process blueprinting or process analysis). Process mapping symbols The symbols that are used to classify different types of activity, usually derived either from scientific management or from information systems flowcharting. High-level process mapping An aggregated process map that shows broad activities rather than detailed activities (sometimes called an outline process map).
Key Terms Test

Work content The total amount of work required to produce a unit of output, usually measured in standard times. Throughput time The time for a unit to move through a process. Cycle time The average time between units of output emerging from a process.
Key Terms Test

Work-in-process The number of units within a process waiting to be processed further (also called work-in-progress). Littles Law The mathematical relationship between throughput time, work-in-process and cycle time: Throughput time = work-in-process cycle time

Chapter 4 Process Design

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Chapter 4 Process design

Source: Joe Schwarz, www.joyrides.com

Planning and control

Nature and purpose of the design activity

Design of the Product

Design of the Process

Design of the Service

Design of the Process

Process mapping symbols derived from Scientific Management

Process mapping symbols derived from Systems Analysis

Input or output from the process

Storage (deliberate storage, as opposed to a delay)

Decision (exercising discretion)

Manufacturing process types

Process flow High

Mass Continuous Low Volume High

One-off, complex, large-scale products with high work content

Very small quantities: one-offs, or only a few required

Preparing photolithography materials on a jobbing basis with a typical process map

A batch process in a kitchen together with an illustrative process map

Mass (line) processes Higher volumes than batch

A mass process a packing process

Part of a continuous process and a typical process map

Service process types

A professional service Consultants planning how best to help their client

Source: Royal Bank of Scotland Group

Service operations process types None

Less process flexibility than is needed so high cost

Old process, new product

New process, new product

Custom furniture maker Machine tool maker Automobile factory

Routine / low discretion

Routine / low discretion

Process mapping symbols derived from Scientific Management

Process mapping symbols derived from Systems Analysis

Transport (a movement of something)

Input or output from the process

Storage (deliberate storage, as opposed to a delay)

Decision (exercising discretion)

Customized sandwich old process

Standard sandwich process

Customized sandwich old process

The operation of making and selling customized sandwiches

Outline process of making and selling customized sandwiches

Detailed process of assembling customized sandwiches

Customized sandwich new process

Assemble whole sandwich Assembly of sandwich bases Use standard base?

Bread and base filling Stored bases

Yes Customer request Assemble from standard base

Description of activity Report arrives

Check payment voucher

Reports filed 25 Payment voucher to keying 26 Confirm payment Totals 7 8 5 5 1

Throughput time = ? Throughput time = 10 2 minutes = 20 minutes

Littles law (a really quite useful law)

Throughput (TH) = Work in process (WIP) Cycle time (CT)

Number of markers = Work content = 1 hour = 14.29 Cycle time 0.07

Work content Throughput time

Utilization Utilization = 33.33 50 100 % % %% Utilization= <100 100%

time Process length of queue Average throughput (or inventory)

High utilization but long throughput times

(b) Managing process capacity and/or variability

Key Terms Test