Design and Planning of Production - open book exam summary
Week 1..........................................................................................................................................................2
Manufacturing Strategy.......................................................................................................................... 2
Product/Process Matrix.......................................................................................................................... 4
Resource Based View (RBV)................................................................................................................. 8
Week 2........................................................................................................................................................ 11
Introduction Lean.................................................................................................................................. 11
The Lean Toolbox - 1............................................................................................................................13
Technical aspects of Lean - 2............................................................................................................... 15
Human aspects of Lean........................................................................................................................17
Week 3........................................................................................................................................................20
Batch size and Lean Manufacturing..................................................................................................... 20
Week 4........................................................................................................................................................22
Scheduling............................................................................................................................................22
Week 5........................................................................................................................................................25
Pull production......................................................................................................................................25
Cellular Manufacturing..........................................................................................................................27
Week 6........................................................................................................................................................30
Line balancing...................................................................................................................................... 30
1
,Week 7........................................................................................................................................................34
Smart industry........................................................................................................................................ 3
Design and Planning of Production
Week 1
Manufacturing Strategy
Operations management
OM = management area that focuses on designing and controlling production processes and
improving business operations.
Elements of production system:
● Resources: machines, warehouses
● People: operators, manages
● Products: raw materials, parts, finished products
● Information: demand, stock levels plans
Main question in OM → Why, when, and how do i get from raw material to finished products
OM levels:
1. Strategic level: focus on long-term manufacturing capabilities
2. Design of operation: decide on production approach:
- Product-oriented (production line)
- process -oriented (job shop)
3. Operational control: day-to-day management, scheduling, quality inspection,
production activities
Manufacturing Strategy
Three important scientific articles:
1. Manufacturing Strategy: Defining the Missing Link
○ Explains the role of manufacturing in a company
2. An Empirical Analysis of the Product-Process Matrix
○ Shows that some production decisions do not fit well together
3. A Resource-Based View of Manufacturing Strategy
○ Looks at how resources link to manufacturing performance
○ Companies can gain competitive advantage through unique capabilities that are
hard to copy
2
,Manufacturing strategy = umbrella for the day-to-day decisions.
Key question: What do you choose to be good at? → your competitive priorities. There are
three ways to express this choice:
1. Dominant orientation → what is my identity?
2. Diversification patterns → Which products do I offer in which markets?
3. Strategy for growth → What are my goals and how do I reach them?
Competitive priorities
You can’t be the best in everything at the same time so you have to choose wisely.
Two types:
- Qualifiers → minimum level need to be considered. Don’t invest too
much.
- Winners → What makes you stand out vs. competitors? You must be
on the performance frontier here
Manufacturing strategy - dominant orientation
Know what your focus is: don’t mix different orientations!
Three possible orientations:
● Market orientation: know what your customers want
● Product orientation: be an expert in your product, find new uses
● Technology orientation: use new technologies in products and processes
→ dominant orientation shapes your focus and company culture
Manufacturing strategy - diversification patterns
Key question: Do you stick to your core business or expand?
Options:
- Multiple products in same market (Suitsupply)
- Same product in different markets (Volkswagen)
- Multiple steps in the supply chain (vertical integration) (Netflix Originals)
- Multiple products in different markets (spreading risk) (microsoft)
Manufacturing strategy - Perspective on growth
Opportunities:
- Enter new markets → bv Tesla
- Increase return on investment
Threats:
- Not growing → competitors will
- Fast growth makes it hard to maintain competitive capabilities (quality, efficiency,
flexibility)
3
,Product/Process Matrix
Three basic decisions of production control
When you design a production system, there are three main design choices for production
control:
1. management/control focus → what is the focus of management:
- Product: managing different products
- Process: managing different production steps
2. Direction of flow → how de products move through the factory
- Unidirectional flow: simple, straight-line process
- Multidirectional flow: products may take different paths
3. Physical layout → how is the physical space arranged
- Around the product, docks, processes or operations
management/control focus
In a process focus → you organize the factory around production steps
- The production manager controls the overall system
- The department managers are responsible for managing departments that focus on
specific processes.
- No coordination needed between departments
→ each product moves through the departments based on what it needs. Also called:
functional layout.
Advantages:
- Efficient use of machines and specialists
- Easy to manage similar processes together
Disadvantages
- Complex scheduling: each product must visit different departments
- High coordination effort → more delays and complexity
In a product focus → you organize the factory around products
- The production managers still oversees the system
- Department manager is responsible for a specific product
→ each product is made within its own department, with all needed processes inside that
department.
Advantages:
- Simpler coordination: each department is responsible for one product
- Faster response to customer orders or changes.
Disadvantages:
- Machines may be duplicated across departments
- Less efficient use of specialized equipment
4
, How to choose between product and process focus?
1. Are my machines product-specific or flexible?
- If machines are designed for a single product: product focus may be better
- If machines are flexible: process focus is more efficient
2. Are my machines expensive>
- Yes? → try to maximize utilization and reduce waiting time for machines
3. Do my customers expect short lead times?
- Yes? → organize production to reduce waiting time and increase throughput
(flow of products through the factory)
Direction of flow
Unidirectional flow: flow shop → all products follow the same sequence of operations
(straight-line)
- This is simple to manage, very efficient for high-volume production.
Multidirectional flow: job shop → each product can follow its own unique
sequence of operations
- Complex and flexible
- Job shops are used for customized, low-volume, or complex products
- Because the products go through many different departments, it's
hard to track the progress of an order → coordination becomes a big
challenge.
Physical layout
In a process/functional focus:
- It's practical to group machines that do the same type of work together
In a product focus:
- It's practical to group machines that are used to build a complete product together
If machines are spread out across departments, you will need a lot of coordination and
transportation between them.
→ Even though the physical layout matters, it does not always define the control structure or
the flow of products.
Examples
Sometimes the physical location of machines is determined by practical reasons:
- Big product c→ product may not move, machines move to it
- dangerous/unhealthy operations → machines like welding/painting are separated for
safety.
- Very big machines → machine position fixed, products must move to it.
- Operator as bottleneck → flow depends on availability of operator
→ machine position alone does not define how control or flow is organized.
5
Week 1..........................................................................................................................................................2
Manufacturing Strategy.......................................................................................................................... 2
Product/Process Matrix.......................................................................................................................... 4
Resource Based View (RBV)................................................................................................................. 8
Week 2........................................................................................................................................................ 11
Introduction Lean.................................................................................................................................. 11
The Lean Toolbox - 1............................................................................................................................13
Technical aspects of Lean - 2............................................................................................................... 15
Human aspects of Lean........................................................................................................................17
Week 3........................................................................................................................................................20
Batch size and Lean Manufacturing..................................................................................................... 20
Week 4........................................................................................................................................................22
Scheduling............................................................................................................................................22
Week 5........................................................................................................................................................25
Pull production......................................................................................................................................25
Cellular Manufacturing..........................................................................................................................27
Week 6........................................................................................................................................................30
Line balancing...................................................................................................................................... 30
1
,Week 7........................................................................................................................................................34
Smart industry........................................................................................................................................ 3
Design and Planning of Production
Week 1
Manufacturing Strategy
Operations management
OM = management area that focuses on designing and controlling production processes and
improving business operations.
Elements of production system:
● Resources: machines, warehouses
● People: operators, manages
● Products: raw materials, parts, finished products
● Information: demand, stock levels plans
Main question in OM → Why, when, and how do i get from raw material to finished products
OM levels:
1. Strategic level: focus on long-term manufacturing capabilities
2. Design of operation: decide on production approach:
- Product-oriented (production line)
- process -oriented (job shop)
3. Operational control: day-to-day management, scheduling, quality inspection,
production activities
Manufacturing Strategy
Three important scientific articles:
1. Manufacturing Strategy: Defining the Missing Link
○ Explains the role of manufacturing in a company
2. An Empirical Analysis of the Product-Process Matrix
○ Shows that some production decisions do not fit well together
3. A Resource-Based View of Manufacturing Strategy
○ Looks at how resources link to manufacturing performance
○ Companies can gain competitive advantage through unique capabilities that are
hard to copy
2
,Manufacturing strategy = umbrella for the day-to-day decisions.
Key question: What do you choose to be good at? → your competitive priorities. There are
three ways to express this choice:
1. Dominant orientation → what is my identity?
2. Diversification patterns → Which products do I offer in which markets?
3. Strategy for growth → What are my goals and how do I reach them?
Competitive priorities
You can’t be the best in everything at the same time so you have to choose wisely.
Two types:
- Qualifiers → minimum level need to be considered. Don’t invest too
much.
- Winners → What makes you stand out vs. competitors? You must be
on the performance frontier here
Manufacturing strategy - dominant orientation
Know what your focus is: don’t mix different orientations!
Three possible orientations:
● Market orientation: know what your customers want
● Product orientation: be an expert in your product, find new uses
● Technology orientation: use new technologies in products and processes
→ dominant orientation shapes your focus and company culture
Manufacturing strategy - diversification patterns
Key question: Do you stick to your core business or expand?
Options:
- Multiple products in same market (Suitsupply)
- Same product in different markets (Volkswagen)
- Multiple steps in the supply chain (vertical integration) (Netflix Originals)
- Multiple products in different markets (spreading risk) (microsoft)
Manufacturing strategy - Perspective on growth
Opportunities:
- Enter new markets → bv Tesla
- Increase return on investment
Threats:
- Not growing → competitors will
- Fast growth makes it hard to maintain competitive capabilities (quality, efficiency,
flexibility)
3
,Product/Process Matrix
Three basic decisions of production control
When you design a production system, there are three main design choices for production
control:
1. management/control focus → what is the focus of management:
- Product: managing different products
- Process: managing different production steps
2. Direction of flow → how de products move through the factory
- Unidirectional flow: simple, straight-line process
- Multidirectional flow: products may take different paths
3. Physical layout → how is the physical space arranged
- Around the product, docks, processes or operations
management/control focus
In a process focus → you organize the factory around production steps
- The production manager controls the overall system
- The department managers are responsible for managing departments that focus on
specific processes.
- No coordination needed between departments
→ each product moves through the departments based on what it needs. Also called:
functional layout.
Advantages:
- Efficient use of machines and specialists
- Easy to manage similar processes together
Disadvantages
- Complex scheduling: each product must visit different departments
- High coordination effort → more delays and complexity
In a product focus → you organize the factory around products
- The production managers still oversees the system
- Department manager is responsible for a specific product
→ each product is made within its own department, with all needed processes inside that
department.
Advantages:
- Simpler coordination: each department is responsible for one product
- Faster response to customer orders or changes.
Disadvantages:
- Machines may be duplicated across departments
- Less efficient use of specialized equipment
4
, How to choose between product and process focus?
1. Are my machines product-specific or flexible?
- If machines are designed for a single product: product focus may be better
- If machines are flexible: process focus is more efficient
2. Are my machines expensive>
- Yes? → try to maximize utilization and reduce waiting time for machines
3. Do my customers expect short lead times?
- Yes? → organize production to reduce waiting time and increase throughput
(flow of products through the factory)
Direction of flow
Unidirectional flow: flow shop → all products follow the same sequence of operations
(straight-line)
- This is simple to manage, very efficient for high-volume production.
Multidirectional flow: job shop → each product can follow its own unique
sequence of operations
- Complex and flexible
- Job shops are used for customized, low-volume, or complex products
- Because the products go through many different departments, it's
hard to track the progress of an order → coordination becomes a big
challenge.
Physical layout
In a process/functional focus:
- It's practical to group machines that do the same type of work together
In a product focus:
- It's practical to group machines that are used to build a complete product together
If machines are spread out across departments, you will need a lot of coordination and
transportation between them.
→ Even though the physical layout matters, it does not always define the control structure or
the flow of products.
Examples
Sometimes the physical location of machines is determined by practical reasons:
- Big product c→ product may not move, machines move to it
- dangerous/unhealthy operations → machines like welding/painting are separated for
safety.
- Very big machines → machine position fixed, products must move to it.
- Operator as bottleneck → flow depends on availability of operator
→ machine position alone does not define how control or flow is organized.
5
