PROCESS STRATEGY

Lesson 3.1
Learning Outcomes

At the end of this lesson, the student will be able to:

• Describe four process strategies
• Identify recent advances in production technology
Process Strategy
• a process strategy is an organization’s approach to
transforming resources into goods and services. Its
objective is to create a process that can produce
offerings that meet customer requirements within cost
and other managerial constraints. (Heizer, Render, &
Munson, 2017),
• The process selected will have a long-term effect on
efficiency and flexibility of production, as well as on
cost and quality of the goods produced.
• A major decision for an operations manager is finding
the best way to produce so as not to waste our planet’s
resources.
1. a customer places an order.
2. The pizza is assembled
3. The pizza is placed in an oven
to bake
4. The pizza is inspected for
quality and order correctness.
5. The pizza is either boxed and
delivered.
 Pizza is assembled

The pizza is placed in an oven to bake

The pizza is inspected for quality and order

correctness.

The pizza is either boxed and

delivered.
Four Process Strategy
Process Focus- low volume, high variety production
• Job shops -Such facilities are organized around
specific activities or processes
• In a factory, these processes might be departments
devoted to welding, grinding, and painting.
• In a factory, these processes might be departments
devoted to welding, grinding, and painting.
• In an office, the processes might be accounts
payable, sales, and payroll.
• In a restaurant, they might be bar, grill, and bakery.
Repetitive Focus

• Under the repetitive process, facilities are organized

as assembly lines. It uses modules with parts and
assemblies made previously. These modules may be
combined for many output options.
• Modules - are parts or components previously
prepared, often in a product focused (continuous)
process.
• Household appliances and automobiles are some of
the products that use assembly lines.
• Fast-food firms are another example of a repetitive
process using modules.
• This type of production allows more customizing than a
product-focused facility; modules (for example, meat,
cheese, sauce, tomatoes, onions) are assembled to get
a quasi-custom product, a cheeseburger.
• In this manner, the firm obtains both the economic
advantages of the product-focused model (where many
of the modules are prepared) and the custom advantage
of the low-volume, high-variety model.
 Product Focus
• Product-focused facilities involves high-volume, low-variety
processes. These are organized around products.
• They are also called continuous processes because they
have very long, continuous production runs
• Products such as glass, paper, tin sheets, lightbulbs, beer,
and potato chips are made via a continuous process. Some
products, such as lightbulbs, are discrete; others, such as
rolls of paper, are made in a continuous flow.
• Such an organization has an inherent ability to set standards
and maintain a given quality, as opposed to an organization
that is producing unique products every day, such as a print
shop or general-purpose hospital.
• requires high fixed cost, but low variable costs
Mass customization
• It is the rapid, low-cost production of goods and services
that fulfill increasingly unique customer desires.
• In mass customization, the products are built to order
which means producing to customer orders, not forecasts.
• Thus, mass customization is difficult to achieve because it
requires sophisticated operational capabilities.
• not just about variety; it is about making precisely what
the customer wants when the customer wants it
economically
• The link between sales, design, production, supply chain,
and logistics must be tight
• Ex. Dell Computer has demonstrated that the payoff for
mass customization can be substantial. Toyota, which
recently announced.
• Ex. Bikes; Milk Tea; coffee (less sugar; with
pearls/sago; cream topping, etc.); Telephone (caller ID;
voice mail); Life Insurance (with add ons like coverage
for accidents, hospitalization, etc.);
• Mass customization/build-to-order is the new
imperative for operations. There are advantages to
mass customization and building to order:
• first, by meeting the demands of the marketplace, firms
win orders and stay in business; in addition,
• they trim costs (from personnel to inventory to facilities)
that exist because of inaccurate sales forecasting.
Four Process Options with an Example of Each
Comparison of the Characteristics of Four Types of
Processes
 Focused Processes
• In order to improve efficiency, firms shift to
specialization. The more focused the firm is, the
better is its efficiency. Focus means specialization,
simplification, and concentration which yields
efficiency.
•
•
Changing Processes
• With the rapid technological change and short
product life cycles, the firm which has flexibility in its
production process has the competitive advantage.
Production Technology
• Advances in technology that enhance production
and productivity are changing how things are
designed, made, and serviced around the world.
Nine technologies that can improve employee safety,
product quality, and productivity:
CNC - Computer numerical control –
Machinery with its own computer and memory.
• New advances in machinery suggest that rather than
removing material as has traditionally been done,
adding material may in many cases be more efficient

• Additive manufacturing - the production of physical

items by adding layer upon layer, much in the same
way an inkjet printer lays down ink.

• Additive manufacturing or, as it is commonly called,

3D printing, is frequently used for design testing,
prototypes, and custom products.
 Ex. CNC Milling Machine

• One of the most common types of CNC machines, a CNC mill utilizes
computer controls to cut various materials. Mills can translate specific
programs of numbers and letters in order to move the spindle in various
ways.
• Many mills use what is known as G-code, which, as mentioned, is a
standardized programming language recognized by most CNC machines. A
CNC mill can have a wide array of functions, such as face milling, shoulder
milling, tapping, drilling and turning. Most CNC mills come in three to six-
axis configurations.
Automatic identification system (AISs)
• A system for transforming data into electronic form, for
example, bar codes.

• Ex. - Radio frequency identification (RFID)- A wireless

system in which integrated circuits with antennas send radio
waves.
• With RFID, a cashier could scan the entire contents of a
shopping cart in seconds.
RFID in Tollways
Vision Systems
 Robots

• A flexible machine with the ability to hold, move, or grab

items. It functions through electronic impulses that
activate motors and switches.
Automated Storage and Retrieval Systems
(ASRSs)
Automated Guided Vehicles (AGVs)
Computer-integrated manufacturing (CIM)

A manufacturing system
in which CAD, FMS,
inventory control,
warehousing, and
shipping are integrated
Thank you!