COMMERCE 2OC3 Chapter Notes - Chapter 7: Mass Customization, Process Design, Product Design
27 Apr 2018
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Operations Textbook
Chapter 7
Process Strategies
Four Process Strategies
- Finding the best way to produce an item
- Process Strategy: An orgs. Approach to transforming resources into gds. And services
- Objective: Create a process that can produce offerings that meet cust. Reqmt. Within
cost and other managerial constraints
- Every gd. Or service is built thru on of these processes
o Process Focus
o Repetitive Focus
o Product Focus
o Mass customization
- Process Focus
o Process Focus: A prod. Facility organized around processes to facilitate low-
volume, high-variety prod.
o Vast majority of global prod. Is built in making low-volume, high-variety
produts i plaes alled jo shops
o Facilities are organized around specific acts. Or processes
▪ Eg. A factory, have certain processes which is devoted to specific acts.
▪ Eg. Office; processes might be A/P, sales, payroll
▪ Eg. Restaurant; bar, grill, and bakery
• These facilities are process focused in terms of eqmt., layout, and
supervision
• Provide high degree of product flexibility as it transfer btwn.
Specialized processes
• Each process is built to handle and perform a variety of acts. And
frq. Changes
o Called intermittent processes
o Many dept. and many routings
o Multiple inputsMultiple outputs
o Eg. Hospital patients (ER, Surgery, Rehab, Pregnancy, etc.)
o High V.Costs w/ extremely low utilization of facilities
- Repetitive Focus
o Utilize modules
o Modules: Parts or components of a product prev. prepared, often in a
continuous process
o Repetitive Process: A product-oriented production process that uses modules
▪ Classic assembly line (automobiles, and household appliances)
▪ More structure and consequently less flexibility than a process-focused
facility
▪ Fast-food firms; allows more customization than prod.-focus
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• Modules (meat, cheese, lettuce, etc.) are assembled to get quasi-
custom product, burger
o Econ. Adv. Of product-focused model (many modules are prepared)
o Low-volume, high variety model
- Product Focus
o Product Focus: A facility organized around products; a product-oriented, high-
volume, low-variety processes
o High-volume, low-variety processes
▪ Also known as continuous processes due to long, continuous prod. Runs
▪ Eg. Rolls of paper, repaired hernias
▪ Lightbulbs; Frito Chips
o The specialization is high fxd. Cost, low V. costs reward high facility utilization
- Mass Customization
o Mass Customization: Rapid, low-cost production that caters to constantly
changing unique cust. desires
o Explosion of varieties took place in cars, movies, cereals, etc.
o It is about what the customer wants and when the cust. Wants it econ.
o Provided by low-volume manufacture (a process focus) at the cost of
standardized high-volume (product-focused)
o Places new demands on opr. Managers who must create and align the processes
that provide this expanding variety of gds./ services
o Making Mass Customz. Work
▪ High-volume system in which products are build-to-order (BTO)
• BTO: Produce to cust. Order rather than to a forecast
• Challenges:
o Product design is imaginative; successful orders have ltd.
product line and modules
o Process design must be flexible and able to accommodate
changes in both design and tech.
▪ Postponement allows for customization late in the
prod. Oricess
o Inv. Mgmt. requires tight control; successful w/ BTO
means avoid being stuck w/ unpopular or obsolete
components
o Tight Schedules that track orders and material from design
thru. Delivery are another reqmt. Of mass customz.
o Responsive partners in the supply chain can yield effective
collaboration
▪ Adv: By meeting the demands of the marketplace, firms win orders and
stay in business; trim costs that exist becuz. Of inaccurate sale forecasting
find more resources at oneclass.com
find more resources at oneclass.com
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Finding the best way to produce an item. Objective: create a process that can produce offerings that meet cust. Or service is built thru on of these processes: process focus, repetitive focus, product focus, mass customization. Process focus: process focus: a prod. Facility organized around processes to facilitate low- volume, high-variety prod: vast majority of global prod. Is built in making low-volume, high-variety produ(cid:272)ts i(cid:374) pla(cid:272)es (cid:272)alled (cid:862)jo(cid:271) shops(cid:863: facilities are organized around specific acts. A factory, have certain processes which is devoted to specific acts: eg. Office; processes might be a/p, sales, payroll: eg. Restaurant; bar, grill, and bakery: these facilities are process focused in terms of eqmt. , layout, and supervision, provide high degree of product flexibility as it transfer btwn. Specialized processes: each process is built to handle and perform a variety of acts. Changes: called intermittent processes, many dept. and many routings, multiple inputs multiple outputs, eg.
