Chapter 4

4.
Chapter 4 Process design
4.1
Slack, Chambers and Johnston, Operations Management, 6th Edition, Nigel Slack, Stuart Chambers, and Robert Johnston 2010
4.2
Key operations questions

In Chapter 4 Process design Slack et al. identify the following key questions: What is process design?
What objectives should process design have? How does volume and variety affect process design?
How are processes designed in detail?
4.2
4.3
To design:
design (v.) 1540s, from Latin designare "mark out, devise, choose, designate, appoint"
from de- "out" (see de-) + signare "to mark," from signum "a mark, sign". Originally in English with the meaning attached to designate; many modern uses of design are metaphoric extensions.
to form or conceive in the mind; to invent, to work out the structure or form of (something), as by making a sketch, outline, or pattern for a specific purpose; to mark out or designate the boundaries and functions of the system
4.3
4.4
Nature and purpose of the design activity

Products, services and the processes which produce them all have to be designed.
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.
Product/service design has an impact on the process design and vice versa.
4.4
4.5
The design of products/services and processes are interrelated and should be treated together
The design of your operations is the mould where your planning is going to be based
Products and services should be designed in such a way that they can be created effectively and efficiently. Effective = doing the right things (goals)
Efficient = doing the right things in the right way (performance)
4.5
4.6
Process mapping symbols

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) Direction of flow Storage (deliberate storage, as opposed to a delay)
Process mapping symbols derived from Systems Analysis

Beginning or end of process
Activity
Input or Output from the process
Decision (exercising discretion)
4.6
4.7
Designing processes A production process transforms resources into products/services (including the customer!) 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 in different volume and variety.
4.7
4.8
Process design Volume-variety and design

The four Vs of operations were volume, variety, variation and visibility. The first two usually go together (high variety usually means low volume, high volume normally means low variety).
Volume and variety determine the way we design performance objectives - quality, speed, dependability, flexibility and cost
4.8
4.9
Manufacturing process types

Process tasks
Diverse/ complex
Process flow High

Intermittent
Project
Jobbing
Variety
Batch
Mass
Continuous Low Volume High
Repeated/ divided
Continuous
Low
4.9
4.10
Project processes
One-off, complex, large scale, high work content products Specially made, every one customized Defined start and finish: time, quality and cost objectives Many different skills have to be coordinated.
4.10
4.11
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, complete whole product.
4.11
4.12
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.
4.12
4.13
Mass (line) processes
Higher volumes than batch Standard, repeat products (runners) Low and/or narrow skills No set-ups, or almost instantaneous ones.
4.13
4.14
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.
4.14
4.15
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
4.15
4.16
Professional service
High levels of customer (client) contact. Clients spend a considerable time in the service process. High levels of customization with service processes being highly adaptable. Contact staff are given high levels of discretion in servicing customers. People-based rather than equipment-based.
4.16
4.17
Service shops
Medium levels of volumes of customers

Medium, or mixed, levels of customer contact
Medium, or mixed, levels of customization

Medium, or mixed, levels of staff discretion.
4.17
4.18
Mass service
High levels of volumes of customers

Low to medium levels of customer contact
Low, or mixed, levels of customization

Low, or mixed, levels of staff discretion.
4.18
4.19
Deviating from the natural diagonal on the productprocess matrix has consequences for cost and flexibility
Manufacturing operations process types Project Jobbing Batch Mass
Less process flexibility than is needed so high cost Volume Variety
Service operations process types None Professional service
More process flexibility than is needed so high cost
Service shop
Continuous None
Mass service
The natural line of fit of process to volume/variety characteristics

4.19
4.20
Customized sandwich old process
Raw materials
Assembly
Stored sandwiches
Move to outlets
Stored sandwiches
Sell
Take payment
Standard sandwich process
Customer request
4.20
4.21
Higher level process map

Prepare Sandwich materials and customers Assemble as required Take payment Customers assembled to sandwiches
The operation of making and selling customized sandwiches
Bread and base filling
Assemble whole sandwich

Use standard base?
The outline process of making and selling customized sandwiches
No Yes
Customer request Assemble from standard base Stored bases Slack, Chambers and Johnston, Operations Management, 6th Edition, Nigel Slack, Stuart Chambers, and Robert Johnston 2010 Fillings
The detailed process of assembling customized sandwiches
4.21
4.22
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
4.22
4.23
Flow process charts for processing expense

1 2 3 4 5 6 Description of activity Report arrives Wait for processing 1 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 expenses report Stamp and date report

Send cash to receipt desk Wait for processing
2 3 4
5 6 7 8 9
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
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
Batch to audit desk Wait for processing

Batch of reports logged Check payment voucher Reports to batch control Batch control number Copy of reports to filing
Before After
Reports filed 25 Payment voucher to keying 26 Confirm payment Totals 7 8 5 5 1
4.23
4.24
Performance objectives
What do these mean for different products and services i.e. architects vs electricity company
architects, the final aesthetic appearance of the building and the appropriateness of its detailed design. electricity supply company, quality is exclusively concerned with error-free service electricity must be constantly available in the correct form (in terms of voltage, frequency, etc.).
Speed
For architects means negotiating a completion date with each client, based on the clients needs and the architects estimates of how much work is involved in each project. Speed in the electricity utility means literally instant delivery. No electricity company could ask its customers to wait for their delivery of electricity
Quality
Dependability
For architects means keeping to each individually negotiated delivery date. In continuous operations, dependability often means the availability of the service. A dependable electricity supply is one which is always there.
Architects: Low economies of scale and high product variability make product more expensive to produce Electricity: High economies of scale and cost variability makes it less expensive to produce
Cost
Flexibility
For architects means the ability to design many different kinds of buildings according to its clients various requirements. With the electricity companys process, the need for product flexibility has disappeared entirely but the ability to meet almost instantaneous demand changes through volume flexibility is vital. Slack, Chambers and Johnston, Operations Management, 6th Edition, Nigel Slack, Stuart Chambers, and Robert Johnston 2010
4.24
4.25
Performance objectives
Quality The meaning of quality has shifted from being concerned primarily with the performance and specification of the product or service towards conformity to a predefined standard, as we move from low volume-high variety operations through to high volume-low variety operations. Speed Speed means an individually negotiated delivery time in low volume-high variety operations, but moves towards meaning instant delivery in some high volume-low variety operations. Dependability Dependability has moved from meaning on-time delivery in low volume-high variety operations to availability in high volume-low variety operations. Flexibility Flexibility has moved from meaning product flexibility in low volume-high variety operations to volume flexibility in high volume-low variety operations. Cost Cost, in terms of the unit cost per product or service, varies with both the volume of output of the operation and the variety of products or services it produces. When variety of products or services in low-volume operations is relatively high, running the operation will be expensive because of the flexible and high skill levels employed. Further, because the volume of output is relatively low, a few products or services are bearing the operations high cost base. Also, and more significantly for the operation, the cost of each product or service is different. At the other end of the scale, high-volume operations usually produce similar products or services, output is high, so that whatever the base cost of the operation, it is shared among a high number of products or services. Cost per unit of output is therefore usually low for operations such as the electricity utility but, more significantly, the cost of producing one second of electricity is the same as the next second. Cost is relatively constant. Slack, Chambers and Johnston, Operations Management, 6th Edition, Nigel Slack, Stuart Chambers, and Robert Johnston 2010
4.25
4.26
Littles law (a really quite useful law)

Throughput (TH) = Work In Process (WIP) x Cycle Time (CT)
Cycle time = 2 mins
WIP = 10
Throughput time = ? Throughput time = 10 2 mins

Throughput time = 20 mins
4.26
4.27
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
4.27
4.28
Throughput time and capacity utilisation
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 % % %%% Q Q Q = = = 0infinity 0 Utilization= =100 <100% Q = >0
High
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
4.28
4.29
Process utilization, waiting time and variability
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 (b) Managing process capacity and/or variability.
(a) Decreasing variability allows higher utilization without long waiting times.
4.29

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4.

Chapter 4 Process design

Key operations questions

How are processes designed in detail?

Nature and purpose of the design activity

Efficient = doing the right things in the right way (performance)

Process mapping symbols

Process mapping symbols derived from Systems Analysis

Input or Output from the process

Decision (exercising discretion)

Process design Volume-variety and design

Manufacturing process types

Process flow High

Higher volumes and lower variety than for jobbing

Standard products, repeating demand. But can make specials

Mass (line) processes

Highly capital-intensive and automated

Service process types

Process flow High

Medium levels of volumes of customers

Medium, or mixed, levels of customization

High levels of volumes of customers

Low, or mixed, levels of customization

Service operations process types None Professional service

More process flexibility than is needed so high cost

The natural line of fit of process to volume/variety characteristics

Customized sandwich old process

Standard sandwich process

Higher level process map

The operation of making and selling customized sandwiches

Bread and base filling

Assemble whole sandwich

The outline process of making and selling customized sandwiches

The 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

Flow process charts for processing expense

Check expenses report Stamp and date report

Batch to audit desk Wait for processing

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

Littles law (a really quite useful law)

Throughput time = ? Throughput time = 10 2 mins

Work content Throughput time

Throughput time and capacity utilisation

time Process length of queue Average throughput (or inventory)

High utilization but long throughput times

Process utilization, waiting time and variability

Average number of units waiting to be processed

Average number of units waiting to be processed

10 20 30 40 50 60 70 80 90 100 Utilization (b) Managing process capacity and/or variability.

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