Chapter 6

Process Selection
and Facility Layout

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Chapter 6: Learning Objectives
You should be able to:
LO 6.1 Explain the strategic importance of process selection and the
influence it has on the organization and its supply chain
LO 6.2 Name the two main factors that influence process selection
LO 6.3 Compare the four basic processing types
LO 6.4 Explain the need for management of technology
LO 6.5 List some reasons for redesign of layouts
LO 6.6 Describe product layouts and their main advantages and
disadvantages
LO 6.7 Describe process layouts and their main advantages and
disadvantages
LO 6.8 Solve simple line-balancing problems
LO 6.9 Develop simple process layouts

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 Process Selection
 Process- core of OM

 Refers to deciding on the production of goods or

services
 Strategic implications

 organizations strategy- Process strategy

 Supply chain

 Process types –capacity differs

 Changes among the process types is time consuming

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LO 6.1
What ?

vision

Org mission goals

Process
strategy

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Implications
Capacity
planning

Layout of
facilities

Different process types have

different capacity ranges
Equipment

Design of work
systems: efficient
use of resources
and setting up of
standards of
performance

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Drivers
 Process selection occurs:

Due to technological changes-

product/process and
information tech.

When new products or

services are introduced Process
selection

Competitive pressures
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 OM implication
 Equipment and labour requirements
 Operations cost
 Ability to meet demand and respond to variations in
demand

 SC implication
 Degree of flexibility required- suppliers
 Volume and variety of inputs and outputs

6-7
 Process Selection and System Design

Facilities and
Forecasting Capacity Equipment
Planning

Product and Layout

Service Design

Process
Selection
Work
Technological
Design
Change
Different process types – different capacity ranges
6-8
LO 6.1
 Process Strategy leads to process selection
 Key Aspects of Process Strategy:
 Capital Intensity
 The mix of equipment and labor that will be used by the
organization
 Process flexibility
 The degree to which the system can be adjusted to changes in
processing requirements due to such factors as
 Product and service design changes
 Volume changes
 Changes in technology

Organization Process Process

strategy strategy selection

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LO 6.1
 Process Selection
Two key questions in process selection:
1. How much variety will the process need to be able to handle?
2. How much volume will the process need to be able to handle?

Low variety – low flexibility

High variety- high flexibility required

Job
Variety- Separate operations – steady demand Shop
Idle time- Change the requirements every time
Batch

Repeti Conti
tive nuous
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LO 6.2
6-11
Volume – Variety Matrix (by Hayes and Wheelwright, 1979)

Process flexibility
Job variety
Unit cost
Lost opportunities
costly

Job shop :
High unit cost
volume and lost
opportunities
Ongoing operations

6-12
TO) Semi-standardized goods or Standardize
Services goods or
Services
Moderate volume variety
of high variety No requirement of highly flexible equipment WIP low-i
,
varying
quirements
a wide variety Flexibility; easy to add or change products or Low unit cos
services, promotes functional specialization, lower efficient
ty-general lead time than job shop
uipment (Multi-
rinters, 3D
omputer
nd skilled

eas
Moderate cost Low flexibil
per unit, WIP high high cost o
moderate 6-13
scheduling
Tool and die maker

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Process production/ flow production
 Dedicated plants with zero flexibility

 Non discrete product.

 Material handling is fully automated

 Predetermined sequence of operations

6-15
Project
 Customized product- Very high
 Time span –making- High
 Time between the make -high
 High unit cost
 High variable cost
 Labour skills – Low to high
 Fixed place for item to be produced and material flow to it.
 End of the production – resources leave

 Ex: Ship building Construction , Bridge construction, Movie production,

Conference
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Process Characteristics

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Morton Salt - An operations Tour

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Morton Salt
1.Steps in salt production for Morton are:
a.Inject water into salt caverns below the surface and let the salt deposits dissolve in the
water.
b.Pump the resulting brine to the surface.
c.Boil the brine and let the liquid evaporate leaving salt crystals and residual moisture.
d.Dry the salt to remove the residual moisture.
e.Store the salt in silos.
f.Move the salt to dedicated production areas.
g.Produce the cans by forming a cylinder (two sheets of chipboard are glued together).
h.Roll the cylinder into a continuous tube.
i.Cut the tubes into can-size pieces.
j.Assemble and glue the separate pieces constituting the can.
k.Fill the cans with salt.
l.Load the filled cans on pallets and store them in inventory.
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Morton Salt
2.Quality is checked during different stages of the
production process.
a.Check salt for purity using chemical analysis.
b.Ensure appropriate crystal size by forcing the salt
through a scraping screen.
c.Remove the small pieces of metal using magnets at
different stages of the process.
d.Check the weight of the filled cans and check that labels
are aligned properly.
e.Check to make sure that plastic pour spouts are attached
correctly.

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 3.The company may not have updated its
equipment because of the high cost of investment
in new machinery.

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4.Salt production would be a low variety, high volume operation, which
would place it as a repetitive production or continuous flow in the
product-process matrix
5.(3,800,000 cans per year) x (26 ounces of salt per can) = 98,800,000
ounces per year.
(98,800,000 ounces per year) / (16 ounces per pound) = 6,175,000
pounds per year.
(6,175,000 pounds per year) / (2000 pounds per ton) = 3,087.5 tons of
salt per year
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6.Suggested improvements include the following:
a.Application of Statistical Process Control (SPC) to
reduce the cost of quality.
b.Develop a plan to overhaul the existing equipment
and to purchase new equipment as a joint effort among
finance, purchasing, and manufacturing areas.
c.Synchronize production, distribution, and capacity
planning to ensure that there is sufficient capacity in the
silos to handle the incoming salt from brine production.

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Summary
 Job shop: design for customers within prefixed time
and cost

 Batch : Job passes through functional departments in

lots or batches and each lot may have different
routing

 Mass pdt: Manufacturing discrete parts using

continuous process

 Flow production process;

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Sustainable Production of
Goods and Services
 There is increasing pressure for organizations to
operate sustainable production processes
 According to the Lowell Center for Sustainable
Production:
 “Sustainable Production is the creation of goods and
services using processes and systems that are: non-
polluting; conserving of energy and natural resources;
economically efficient; safe and healthful for workers,
communities, and consumers; and, socially and
creatively rewarding for all working people.”

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Process and Information Technology
 Process and Information technology can have a major
impact on costs, productivity and competitiveness:
 Process technology
 Methods, procedures, and equipment used to produce goods and
provide services
 Information technology
 The science and use of computers and other electronic equipment to
store, process, and send information

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 The Need to Manage Technology
 Process technology and information technology
can have a profound impact on:
 Costs
 Productivity
 Competitiveness

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LO 6.4
Automation
 Automation
 Machinery that has sensing and control devices that
enable it to operate automatically
 Fixed automation
 Programmable automation
 Flexible automation

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Programmable Automation
 Programmable Automation
 Involves the use of high-cost, general-purpose equipment
controlled by a computer program that provides both the
sequence of operations and specific details about each
operation
 Computer-Aided Manufacturing (CAM)
 The use of computers in process control, ranging from robots to automated quality
control
 Numerically Controlled (N/C) Machines
 Machines that perform operations by following mathematical processing
instructions
 Robot
 A machine consisting of a mechanical arm, a power supply, and a controller

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Flexible Automation
 Flexible automation
 evolved from programmable automation. It uses equipment
that is more customized than that of programmable
automation. A key difference between the two is that flexible
automation requires significantly less changeover time.
 FMS (Flexible Manufacturing System)
 A group of machines designed to handle intermittent processing requirements and
produce a variety of similar products

 CIM (Computer Integrated Manufacturing)

 A system for linking a broad range of manufacturing activities through an
integrated computer system

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Computer Integrated Manufacturing (CIM)
 CIM
 A system for linking a broad range of manufacturing
activities through an integrated computer system
 Activities include
 Engineering design
 FMS
 Purchasing
 Order processing
 Production planning and control
 The overall goal of CIM is to link various parts of an
organization to achieve rapid response to customer orders
and/or product changes, to allow rapid production and to
reduce indirect labor costs

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