symbiosis om mba ee module 2 nov 9
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CHAPTER
0
Introduction toOperation Management
Prof.G.Purandaran
M.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
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What is Operations Management?
The business functionresponsible for
Planning,
Coordinating, andControlling
the resources needed
to produce a companys
products and services
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Operations Management Definition
Operations management is defined as:
the design,
operat ion, and improvementof the systems
that create and deliver
the firms primaryproductsandservices.
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Why Study Operations Management?
OperationsManagement
Business Education/
Career Opportunities
Systematic Approachto Org. Processes
Increase Competitive
Advantage/Survival
Cross-FunctionalApplications
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Operations Decision Making
People Plants Parts Processes
Planning and Control
Materials &
Customers
Products &
Services
Input Output
Operations Management
Marketing StrategyFinance Strategy
Marketplace
Corporate Strategy
Operations Strategy
The Transformation Process (value adding)
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Quality
Management
Statistical
Process Control
Just in Time
Materials Requirement Planning
Inventory Control
Aggregate
Planning
Operations Management - Overview
Project
Management
Supply Chain
Management
Process Analysis
and Design
Process Control
and Improvement
Waiting Line Analysis and
Simulation
Services
Manufacturing
Operations
Strategy
Facility Layout
Consulting and
Reengineering
Process Analysis
Job Design
Capacity Management
Planning for Production
Supply Chain
Strategy
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Operations Strategy
Customer Needs
Corporate Strategy
Operations Strategy
Decisions on Processes
and Infrastructure
ExampleStrategy Process
More Product
Increase Org. Size
Increase Production Capacity
Build New Factory
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Competitive Dimensions
Cost
Quality and Reliability
Delivery Flexibility Speed Reliability
Coping with Changes in Demand New Product Introduction
Speed Flexibility
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CHAPTER
1
Product Life Cycle
Prof.G.Purandaran
M.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
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Product Life Cycles
May be any length from a few hours
to decades The operations function must be
able to introduce new productssuccessfully
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Product Life Cycles
Negativecash flow
Introduction Growth Maturity Decline
Sales,
cost,andcashflow
Cost of development and production
Cashflow
Net revenue (profit)
Sales revenue
Loss
Figure 5.1
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PLC
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Product Life Cycle
Introductory Phase
Fine tuning may warrant unusualexpenses for
1. Research
2. Product development
3. Process modification andenhancement
4. Supplier development
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.
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Product Life Cycle
Growth Phase
Product design begins to stabilize
Effective forecasting of capacitybecomes necessary
Adding or enhancing capacity maybe necessary
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.
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Product Life Cycle
Maturity Phase
Competitors now established
High volume, innovativeproduction may be needed
Improved cost control, reduction
in options, paring down ofproduct line
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PLC-Maturity/Decline
.
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Product Life Cycle
Decline Phase
Unless product makes a specialcontribution to the organization,must plan to terminate offering
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PLC
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Product Life Cycle Costs
Costs incurred
Costs committed
Ease of change
Concept Detailed Manufacturing Distribution,
design design service,
prototype and disposal
Percentoftotalcost
100
80
60
40
20
0
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Product-by-Value Analysis
Lists products in descending order of
their individual dollar contribution to
the firm Lists the total annual dollar
contribution of the product
Helps management evaluatealternative strategies
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Product-by-Value Analysis
Individual
Contribution ($)
Total Annual
Contribution ($)Love Seat $102 $36,720
Arm Chair $87 $51,765
Foot Stool $12 $6,240Recliner $136 $51,000
Sams Furniture Factory
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CHAPTER
2
Product & Service Design
Prof.G.Purandaran
M.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
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Product & Service Design
The process of deciding on the unique
characteristics of a companys product &
service offerings
Serves to define a companys customer base,
image, competition and future growth
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Products versus Services
Products:
Tangible offerings
Dimensions, materials, tolerances & performance
standards
Services:
Intangible offerings
Physical elements + sensory, esthetic, &psychological benefits
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Strategic Importance
Products & service offerings must support the
companys business strategy by satisfying the
target customers needs & preferences
If not, the company will lose its customer base
and its market position will erode
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Steps in Product Design
Idea Development: A need is identified & a product idea to satisfy it is put
together
Product Screening: Initial ideas are evaluated for difficulty & likelihood of
success
Preliminary Design & Testing Market testing & prototype development
Final Design Product & service characteristics are set
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Idea Development
Existing & target customers Customer surveys & focus groups
Benchmarking
Studying best in class companies from your industry orothers and comparing their practices & performance toyour own
Reverse engineering Disassembling a competitors product & analyzing its
design characteristics & how it was made
Suppliers, employees and technical advances
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Product Screening
Operations: Are production requirements consistent with existing
capacity?
Are the necessary labor skills & raw materials available?
Marketing: How large is the market niche?
What is the long-term potential for the product?
Finance: What is the expected return on investment?
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Break-Even Analysis
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Break-Even Analysis
Total cost = fixed costs + variable costs (quantity):
Revenue = selling price (quantity)
Break-even point is where total costs = revenue:
QVCFTC
QSPR
VCSP
FQor
QSPQVCForRTC
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Break-Even Analysis Example
A firm estimates that the fixed cost of
producing a line of footwear is $52,000 with a
$9 variable cost for each pair produced. They
want to know: If each pair sells for $25, how many pairs must
they sell to break-even?
If they sell 4000 pairs at $25 each, how muchmoney will they make?
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Example Solved
Break-even point:
Profit = total revenuetotal costs
pairsVCSP
FQ 3250
9$25$
000,52$
000,12$
40009$000,52$400025$
QVCFQSPP
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Preliminary Design & Testing
General performance characteristics are
translated into technical specifications
Prototypes are built & tested (maybe offered
for sale on a small scale)
Bugs are worked out & designs are refined
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Final Design
Specifications are set & then used to:
Develop processing and service delivery
instructions
Guide equipment selection
Outline jobs to be performed
Negotiate contracts with suppliers and distributors
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Other Design factors
Design for Manufacture
Product Life Cycle
Concurrent Engineering
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Design for Manufacture (DMF)
Minimize parts
Design parts for
multiply applications Use modular design
Avoid tools
Simplify operations
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Design For Manufacture Benefits
Lower costs:
Lower inventories (fewer, standardized
components)
Less labor required (simpler flows, easier tasks)
Higher quality:
Simple, easy-to-make products means fewer
opportunities to make mistakes
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Concurrent Engineering
A design approach that uses multifunctional
teams to simultaneously design the product &
process
Replaces a traditional over-the-wall approach
where one group does their part & then hands
off the design to the next group
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Sequential Design
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Concurrent Engineering
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Concurrent Engineering Benefits
Representatives from the different groups can better
consider trade-offs in cost & design choices as each
decision is being made
Development time is reduced due to less rework(traditionally, groups would argue with earlier
decisions & try to get them changed)
Emphasis is on problem-solving (not placing blame
on the other group for mistakes)
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Service Design
Service typically includes direct interactionwith the customer
Increased opportunity for customization
Reduced productivity
Cost and quality are still determined at thedesign stage
Delay customization
Modularization
Reduce customer interaction, often throughautomation
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Service Design
Figure 5.12
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Service Design
Figure 5.12
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Application of Decision Trees to
Product Design Particularly useful when there are a
series of decisions and outcomes which
lead to other decisions and outcomes
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Application of Decision Trees to
Product Design
1. Include all possible alternatives and states
of nature - including doing nothing2. Enter payoffs at end of branch
3. Determine the expected value of each
branch and prune the tree to find thealternative with the best expected value
Procedures
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(.6)
Low sales
(.4)
High sales
(.6) Low sales
(.4)High sales
Decision Tree Example
Purchase CAD
Hire and train engineers
Do nothing
Figure 5.14
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(.6) Low sales
(.4)
High sales
Decision Tree Example
Purchase CAD
(.6)
Low sales
(.4)
High sales
Hire and train engineers
Do nothing
Figure 5.14
$2,500,000 Revenue
- 1,000,000 Mfg cost ($40 x 25,000)- 500,000 CAD cost
$1,000,000 Net
$800,000 Revenue- 320,000 Mfg cost ($40 x 8,000)- 500,000 CAD cost
- $20,000 Net loss
EMV (purchase CAD system) = (.4)($1,000,000) + (.6)(- $20,000)
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(.6)
Low sales
(.4)
High sales
(.6) Low sales
(.4)
High sales
Decision Tree Example
Purchase CAD$388,000
Hire and train engineers$365,000
Do nothing $0
$0 Net
$800,000 Revenue- 400,000 Mfg cost ($50 x 8,000)- 375,000 Hire and train cost
$25,000 Net
$2,500,000 Revenue- 1,250,000 Mfg cost ($50 x 25,000)
- 375,000 Hire and train cost
$875,000 Net
$2,500,000 Revenue
- 1,000,000 Mfg cost ($40 x 25,000)- 500,000 CAD cost
$1,000,000 Net
$800,000 Revenue- 320,000 Mfg cost ($40 x 8,000)- 500,000 CAD cost
- $20,000 Net loss
Figure 5.14
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Transition to Production
Know when to move to production
Product development can be viewed as
evolutionary and never complete
Product must move from design to production in atimely manner
Most products have a trial production period to
insure producibility
Develop tooling, quality control, training Ensures successful production
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Transition to Production
Responsibility must also transition as the
product moves through its life cycle
Line management takes over from design
Three common approaches to managingtransition
Project managers
Product development teams
Integrate product development and manufacturingorganizations
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PACCAR
PACCAR is a global technology leader in the: Design,
manufacture and
customer support of premium light-,
medium- and
heavy-duty trucks under the
Kenworth, Peterbilt and
DAF nameplates.
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Paccar Trucks
.
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Paccar Trucks
.
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Caterpillar Product Design
.
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Walking Dragline
.
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Walking Dragline
.
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CHAPTER
3
New Product Development
Prof.G.PurandaranM.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
N P d D l
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New Product Development
.
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New Product Development
.
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Stage 1: Idea Generation
New product ideas have to come from somewhere. But where do organizations get their ideas for NPD?
Sources include:
Market Research
Employees
Consultants
Competitors
Customers Distributors and Suppliers
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Idea Generation
.
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Stage 2: Idea Screening
This process involves shifting through theideas generated above and selecting ones
which are feasible and practical to develop.
Pursing impractical ideas is expensive and awaste of resources.
Idea Screening
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Idea Screening
.
Stage 3: Concept Development and
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Stage 3: Concept Development and
Testing
The organization may have come across what theybelieve to be a feasible idea, however, the idea needsto be taken to the target audience.
What do they think about the idea?
Will it offer the benefit that the organization hopes itwill?
or have they overlooked certain issues?
Will there be a demand for the product?
Note the idea taken to the target audience is not aworking prototype at this stage, it is just a concept.
Concept Development & Testing
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Concept Development & Testing
.
Stage 4: Marketing Strategy and
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Stage 4: Marketing Strategy and
Development
How will the product/service idea be launchedwithin the market?
A proposed marketing strategy will be written
laying out the: marketing mix strategy of the product,
the segmentation,
targeting and
positioning strategy and
expected sales and profits.
Marketing Strategy & Development
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Marketing Strategy & Development
.
Stage 5: Business Analysis
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Stage 5: Business Analysis
The company has a great idea: the marketing strategy seems feasible,
but will the product be financially worth while in
the long run? The business analysis stage looks more deeply intothe CASHFLOWthe product could generate,
what the cost will be,
how much market shares the product may achieve and the expected life of the product.
Business Analysis
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Business Analysis
.
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Stage 6: Product Development
At this stage the prototype is produced.
The prototype will :
undergo a serious tests,
and will be presented to a selection of people
made up of
the target market SEGMENT to see if changes
need to be made.
Product Development
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Product Development
.
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Stage 7: Test Marketing
Test marketing means :
testing the product within a specific geographic
area.
The product will be launched within a particularregion
so the marketing mix strategy can be monitored
and
if needed modified before national launch
Test Marketing
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Test Marketing
.
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Stage 8: Commercialization
If test marketing is successful the product is readyfor national launch.
The following decisions regarding the nationallaunch need to be made:
timing of the launch
how the product will be launched
where the product will be launched
will there be a national roll out or will it be region by region?
Commercialization
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Commercialization
.
l i
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Conclusion
The eight stages of product development may seemlike a long process but they are designed to savewasted time and resources.
New product development ideas and prototypes aretested to ensure that the new product will meet targetmarket needs and wants.
There is a test launch during the test marketing stageas a full market launch is expensive.
Finally the commercialization stage is carefully
planned to maximize product success, a poor launchwill affect product sales and could even affect thereputation and image of the new product.
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CHAPTER
4
Process Design
Prof.G.PurandaranM.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
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Design:
To design refers to the process of originatingand developing a plan for a product, service or
process.
Process:
Is any part of an organization which takes a set
of input resources which are then used totransform something into outputs of products
or services.
Process Design
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Process Design
Processes thatDesign Products
and Services
Concept Generation
Screening
Preliminary Design
Evaluation andImprovement
Prototyping and finaldesign
Processes thatProduce Products
and Services
Supply Network Design
Layoutand Flow
Process
Technology
Job
Design
Process design
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Nature of the design activity:
1) Design is inevitableproducts, services and the
processes which produce them all have to be
designed.
2) Product design influences process design
decisions taken during the design of a product or
service will have an impact on the decisions taken
during the design of the process which producesthose products or services and vice versa.
Product & services design are
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Product & services design are
interrelated to its process design
Decisions taken during the design of the product or service will havean impact on the process that produces them and vice versa
Products and s erv icesshould be des igned insuch a way that they
can be cr eatedeffectively
Processes should be
designed so they cancreate all p rodu ctsand serv ices which
the operat ion is l ikelyto int roduce
Designing theProduct or
Service
Designing theProcesses that
Produce the Productor Service
Process Design and Product/Service Design are Interrelated
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Process Design and Product/Service Design are Interrelated
To commit to the detailed design of a product or service
consideration must be given to how it is to be produced. Design of process can constrain the design of products and
services.
The overlap is greater in the service industry:
Service industry - it is impossible to separate servicedesign and process designthey are the same thing.
Manufacturing industry - it is possible to separate product
design and process design but it is beneficial to consider
them together because the design of products has a major
effect on the cost of making them.
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The design activity is itself a process Finished designswhich are:
High qual ity: Error-free designswhich fulfil their purpose in aneffective and creative way
Speedi ly prod uced: Designswhich have moved fromconcept to detailedspecification in a short time
Dependably del ivered: Designswhich are delivered whenpromised
Produced f lex ib ly: Designs
which include the latest ideasto emerge during the process
Low cost : Designs producedwithout consuming excessiveresources
TRANSFORMEDRESOURCES
Technical informationMarket informationTime information
TRANSFORMINGRESOURCES
Test and designequipment
Design and technicalstaff
THE DESIGNACTIVITY OUTPUTINPUTS
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Designing processes Process mapping
Process mapping symbols
Improving processes
Process performance Throughput, cycle time & work in process
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Process mapping Used to identify different types of activities.
Shows the flow of material, people or
information.
Critical analysis of process maps can improve
the process.
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Operation (an activitythat directly adds value)
Inspection (a check ofsome sort)
Transport (a movementof some thing)
Delay (a wait, e.g. for materials)
Storage (deliberate storage,as opposed to a delay)
Process mapping symbols derivedfrom Scientific Management
Decision (exercising discretion)
Process mapping symbols derivedfrom Systems Analysis
Direction of flow
Input or Output from the process
Activity
Beginning or end of process
Process mapping symbols
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Standard sandwich process
RawMaterials
Assembly StoredSandwiches
Move toOutlets
StoredSandwiches
SellTake
Payment
CustomerRequest
RawMaterials
Assembly TakePayment
CustomerRequest
Customized sandwich old process
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PrepareAssemble as
requiredTake
payment
Bread andBase filling
StoredBases
Fillings
Assemble wholesandwich
Customer
Request
Use standardbase?
Assemble fromstandard base
No
Yes
The operation of making andselling customized sandwiches
The outline process of making andselling customized sandwiches
The detailed process ofassembling customized
sandwiches
Sandwich
materials andcustomers
Customers
assembled tosandwiches
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Customized sandwich improvednew process
Bread andBase filling
Assembly ofsandwich
bases
Stored Bases
Fillings
Assemble wholesandwich
TakePayment
Customer Request
Use standardbase?
Assemble fromstandard base
No
Yes
Two handed process chart
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Left hand Right hand
Pick up base plate
Insert into fixture
Pick up two supports
Locate back plate
Pick up screws
Locate screws
Pick up air driver
Fasten screws
Replace air driver
Pick up centre assembly
Inspect centre assembly
Locate and fix
Switch on timer
Wait to end test
Inspect
Transfer grasp
Put aside
Wait
Hold base plate
Wait
Hold centre assembly
Inspect
Transfer grasp
Wait
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Process performance Process performance can be judge against the
five key performance objective:
Quality
Speed Dependability
Flexibility
Cost
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Throughput, work content, cycle time, and work
in process Throughputthe time for a unit to move through
the process
Work contentthe total amount of work required to
produce a unit of output (measured in time)
Cycle timeThe average time between units of
output emerging form the process
Work in process (WIP)unfinished items in a production process
waiting for further processing e. g. when customers join aqueue in a process they become WIP
throughput = work in process x cycle time
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Project Processes
One-off, complex, large scale, high workcontent products
Specially made, every one customized
Defined start and finish: time, quality and costobjectives
Many different skills have to be coordinated
Fixed position layout
Project Process
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Project Process
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Jobbing Processes
Very small quantities: one-offs, or only a fewrequired
Specially made. High variety, low repetition.
Skill requirements are usually very broad Skilled jobber, or team of jobbers complete
whole product
Fixed position or process layout (routingdecided by jobbers)
Jobbing Process
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Jobbing Process
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Batch Processes
Higher volumes and lower variety than forjobbing
Standard products, repeating demand. Butcan make specials
Specialized, narrower skills
Set-ups (changeovers) at each stage of
production Process or cellular layout
Batch Process
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Batch Process
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Mass Process
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Mass Process
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Continuous Process
Extremely high volumes and low variety: oftensingle product
Standard, repeat products
Highly capital-intensive and automated
Few changeovers required
Difficult and expensive to start and stop the
process Product layout: usually flow along conveyors
or pipes
Continuous Process
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Continuous Process
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VolumeLow High VolumeLow High
Variety
Lo
w
High
Variety
Lo
w
High
Project
Jobbing
Batch
Mass
Contin-
uous
Professionalservice
Service shop
Mass service
Service processtypes
Manufacturing processtypes
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CHAPTER
5
Cross Functional Product Design
Prof.G.PurandaranM.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
Cross Functional Product Design
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Cross Functional Product Design
A cross-functional teamis a group of people with differentfunctional expertise working toward a common goal.
It may include people from
finance,
marketing,
operations, and
human resourcesdepartments.
Typically, it includes employees from all levels of anorganization.
Members may also come from outside an organization (inparticular, from suppliers, key customers, or consultants).
Cross Functional Product Design
http://en.wikipedia.org/wiki/Financial_managementhttp://en.wikipedia.org/wiki/Marketing_managementhttp://en.wikipedia.org/wiki/Operations_managementhttp://en.wikipedia.org/wiki/Human_resource_managementhttp://en.wikipedia.org/wiki/Human_resource_managementhttp://en.wikipedia.org/wiki/Operations_managementhttp://en.wikipedia.org/wiki/Marketing_managementhttp://en.wikipedia.org/wiki/Financial_management -
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Cross Functional Product Design
Cross-functional teamsoften function as self-directed teams assigned to a specific task
which calls for the input and expertise of
numerous departments. Assigning a task to a team composed of multi-
disciplinary individuals increases the level of
creativity and out of the box thinking.
Cross Functional Product Design
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Cross Functional Product Design
Each member offers an alternativeperspective to the problem and potential
solution to the task.
In business today, innovation is a leadingcompetitive advantage and cross-functional
teams promote innovation through a creative
collaboration process.
Cross Functional Product Design
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Cross Functional Product Design
Members of a cross-functional team must bewell versed in multi-tasking as they are
simultaneously responsible for their cross-
functional team duties as well as their normalday-to-day work tasks.
Decision makingwithin a team may depend
on consensus, but often is led by amanager/coach/team leader.
Cross Functional Product Design
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Cross Functional Product Design
Leadership can be a significant challenge withcross-functional teams.
Leaders are charged with the task of directing
team members of various disciplines. They must transform different variations of
input into one cohesive final output.
Cross-functional teams can be likened to theboard of directors of a company.
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Cross Functional Product Design
A group of qualified individuals of variousbackgrounds and disciplines are assembled to
collaborate in an efficient manner in order to
better the organization or solve a problem.
Concurrent Engineering
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Concurrent Engineering
Concurrent engineering can be definedas the simultaneous development ofdesign functions, with open and
interactive communication existingamong all team members for thepurpose of:
reducing time to market
decreasing cost improving quality and reliability
3
Phased versus Overlapping Approach in NewProduct Development
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Designinformation
processing
Activity1
Activity2
Activity3
Information batch size
Single batchtransfer of
info
Phased Approach
Start ofActivity 2
Start ofActivity 3
Elapsedtime
Designinformationprocessing
Activity1
Activity2
Small batch transfer of info Overlapping Approach
Start ofActivity 2
Start ofActivity 3
Elapsedtime
____________________________________________________________
New Product Development: The New Time Wars Joe Blackburn, 1991. 3a
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CHAPTER
6
Design for Manufacture &Assembly
Prof.G.PurandaranM.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
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Introduction to
Design for (Cost Effective)Assembly and
Manufacturing
Purpose Statement
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Purpose Statement
To provide an overview of Design for
Manufacturing and Assembly (DFMA)
techniques, which are used to minimize
product costthrough design and
process improvements.
Objectives
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Objectives
Participants will understand: Differences and Similarities between Design for
Manufacturing and Design for Assembly
Describe how product design has a primary influence
Basic criteria for Part Minimization
Quantitative analysis of a designs efficiency
Critique product designs for ease of assembly
The importance of involving production engineers in DFMA
analysis
Design for Assembly
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g y
Definition: DFA is the method of design of theproduct for ease of assembly.
Optimization
of the part/sy stem
assembly
DFA is a tool used to assist the design teams in the design of
products that will transition to productions at a minimum cost,
focusing on the number of parts, handling and ease of assembly.
Design for Manufacturing
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g g
Definition: DFM is the method of design forease of manufacturing of the collection of
parts that will form the product after
assembly.Optimization of themanufactur ing
process
DFA is a tool used to select the most cost effective material and
process to be used in the production in the early stages of product
design.
Differences
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Design for Assembly (DFA)
concerned only with reducing product
assembly cost minimizes number of assembly operations
individual parts tend to be more complex in design
Design for Manufacturing (DFM)
concerned with reducing overall part
production cost
Similarities
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Both DFM and DFA seek to reduce material,
overhead, and laborcost.
They both shorten the productdevelopment cycle time.
Both DFM and DFA seek to utilize standards
to reduce cost
Terminology
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gy
Design for Manufacturing (DFM) and Design for
Assembly (DFA) are now commonly referred to as
a single methodology, Design for Manufacturingand Assembly (DFMA).
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Design
70 - 80%
Manufacturing
20 - 30%
What Internal Organization has the most
Influence over Price, Quality, & Cycle Time?
Knowledge and Learning
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Time Into the Design Process
Percentag
e
100908070
605040302010
100908070
605040302010
High
Low
Cost of Change
Design Freedom toMake Changes
Knowledge of DesignBehavior
Production
ProcessCapability
Knowledge
DFSSMarketing
Knowledge
g g
Sequence of Analysis
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Concept Design
Design forAssembly
Design forManufacturing
Detailed Design
Optimize Design forPart Count and
Assembly
Optimize Design forProduction Readiness
q y
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Design for Assembly
DFA is a process that REQUIRES
involvement of Assembly Engineers
Design for Assembly Principles
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g y p
Minimize partcount Design parts with self-locating features
Design parts with self-fastening features
Minimize reorientationof parts during assembly
Design parts for retrieval, handling, & insertion
Emphasize Top-Downassemblies
Standardizepartsminimum use of fasteners.
Encourage modulardesign
Design for a base partto locate other components
Design for component symmetry for insertion
DFA Process
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q Product Information: func t ional requirementsq Functional analysisq Identify parts that can be standardizedq Determine part count efficiencies
Step 2
Step 1
q Analyze data for new design
Step 3
q Identify handling(grasp & orientation) opportunitiesStep 4
q Identify insertion(locate & secure) opportunitiesStep 5
Step 6 q Identify opportunities to reduce secondary operations
q Identify quality(mistake proofing) opportunities
Benchmark when possible
q Determine your practical part count
Step 7
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q Product Information: funct ional requirements
qFunctional analysisq Identify parts that can be standardized
q Determine part count efficiencies
Step One
Considerations/Assumptions
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The first part is essential (base part)
Non-essential parts:
Fasteners
Spacers, washers, O-rings
Connectors, leads
Do not include liquids as parts(e.g.. glue, gasket sealant, lube)
Step
One
Part Identification
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List parts in the order
of assembly
Assign/record part
number
So take it apart!
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Count Parts & Interfaces
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List number of parts
(Np)
List number of
interfaces (Ni)
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Your Turn
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List parts in the order of assembly. Assign part number to keep up with the part.
List number of parts (Np)
List number of interfaces (Ni)
Current Consider Other
Determine Theoretical Min. No. of Parts
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CurrentDesign Specification Options
Does the partmove relative
to all otherparts alreadyassembled?
Is the part ofa different
material, or
isolated from,all other parts
alreadyassembled?
Is the partseparate toallow for its
in-serviceadjustment orreplacement?
Is themovement
essential forthe productto function?
Is a differentmaterial or
isolationessential forthe productto function?
Is theadjustment or
replacementessential?
Must the partbe separate
to provide therequired
movement?
Must the partbe separate
to satisfy the
differentmaterial orisolation
requirement?
Must the partbe separate
to enable theadjustment orreplacement?
Y
Y
Y Y
Y
Y
EssentialPart
N N N
N N N
Y
Y
Y
N N N
NonEssential
Part
Movement
Isolation
Adjustmentor
Repla
cement
C D i C id S ifi i Oth O ti
Functional Analysis
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Current Design Consider Specification Other Options
Does the part moverelative to all other
parts alreadyassembled?
Is the part of adifferent material, or
isolated from, allother parts already
assembled?
Is the part separateto allow for its in-
service adjustmentor replacement?
Is the movementessential for the
product to function?
Is a different
material or isolationessential for the
product to function?
Is the adjustment or
replacementessential?
Must the part beseparate to provide
the requiredmovement?
Must the part be
separate to satisfythe differentmaterial or isolation
requirement?
Must the part beseparate to enablethe adjustment or
replacement?
Y
Y
Y Y
Y
Y
EssentialPart
N N N
N N N
Y
Y
Y
N N N
Non EssentialPart
Moveme
nt
Isolation
Adjust
ment
or
Replacement
Determine if Parts Can be Standardized
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Can the current parts be
standardized?:
Within the assembly
station
Within the full assembly
Within the assembly
plant
Within the corporation
Within the industry
Should they be?
(Only put a Y if both
answers are yes)
Theoretical Part Count Efficiency
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Theoretical Part
Count Efficiency
Theoretical Min. No. Parts
Total Number of Parts
Theoretical Part 1
Count Efficiency 10
Theoretical Part
Count Efficiency
=
= * 100
= 10%
* 100
GoalRule of ThumbPartCount Efficiency Goal >
60%
DFA Complexity FactorDefinition
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Cummins Inc. metric for assessing complexityof a product design
Two Factors
NpNumber of parts NiNumber of part-to-part interfaces
Multiply the two and take the square root of the
total
This is known as the DFA Complexity Factor
SNp x SNi
DFA Complexity FactorTarget
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Smaller is better (Minimize Np and Ni)
Let Npt = Theoretical Minimum Number of parts
from the Functional Analysis
Npt = 5
Let Nit = Theoretical minimum number of part to part interfaces
Nit = 2(Npt-1)
Nit = 2(5-1) = 8
Part 2
Part 3
Part 4
Part 5
Part 1
DCF SNp x SNi
DCFt SNpt x SNit
DCFt 5x 8 = 6.32
Determine Relative Part Cost
Levels
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Levels Subjective estimateonly
Low/Medium/High
relative to other parts
in the assembly
and/or product line
Cost Breakdown
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Media paper 21.4%
Centertube 3.6% Endplates (2) 3.0%
Plastisol 2.6%
Inner Seal 4.0%
Spring 0.9%
Shell 31.4%
Nutplate 21.0%
Retainer 4.8%
Loctite 0.3%
End Seal 7.0%
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Step Two
Determine Practical Minimum Part Count
Determine Practical Minimum Part Count
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Team assessment of
practical changes Tradeoffs between part
cost and assembly cost
Th i l N b f
Creativity & Innovation
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Innovation
No. Parts
Current Design
Practical Min.No. Parts
Practical & Achievable
Theoretical Number ofParts...
Theoretical Min.No. Parts
Blue Sky
Cost of Assembly Vs Cost of Part Manufacture
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Part Count Reduction
Assembly Saving(DFA)
Part ManufactureSaving (DFM)
Saving
Optimum
Total Saving
Idea Classification
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Implementation
RiskHighMediumLow
Short
Term
MediumTerm
LongTerm
Step
Two
Dont constrain yourself to incremental improvement
unless you have to!
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This style doesnt tear paper like the claw style and is much cheaper
to produce!
Your Turn...
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Steps
One &
Two
Product Information:funct ional requirements
Functional analysis
Identify parts that can bestandardized
Determine part countefficiencies
Determine your practical part count
Instructions
Fasteners
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A study by Ford Motor Co. revealed
that threaded fasteners were the most
common cause of warranty repairs
This finding is echoed in more recent
survey of automotive mechanics, in
which 80% reported finding loose or
incorrect fasteners in cars they
serviced
StepOne
Component Elimination
Example: Rollbar Redesign
If more than 1/3 of the components in a product are
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24 Parts
8 different parts
multiple mfg. & assembly
processes necessary
2 Parts
2 Manufacturing processes
one assembly step
..If more than 1/3 of the components in a product are
fasteners, the assembly logic should be questioned.
Fasteners: Cummins Engines
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Data from Munroe & Associates October 2002
Engine Type Number of
Components
Number of
Fasteners
Percent
Fasteners
B Series, 6 Cyl 5.9L 1086 436 40%
B Series, 4 Cyl 3.9L 718 331 46%
C Series, 8.3L 1111 486 44%
Standard Bolt Sizes
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Minimize extra sizes to both reduce inventoryand eliminate confusion during assembly
M5 x .8 M6 x 1.0 M8 x 1.25 M10 x 1.5 M11 x 1.25M12 x 1.25M12 x 1.75 M14 x 1.5 M16 x 2.0 Qty Required
12mm 0
14mm 2 2
16mm 3 320mm 4 8 8 20
25mm 6 6 12
30mm 3 8 11
35mm 10 35 45
39.5mm 32 12 10 4 58
40mm 41 27 6 74
45mm 22 9 1 32
50mm 4 9 25 18 12 6860mm 13 8 15 36
70mm 6 6
Required 2 7 93 152 75 16 21 0 1 367
Candidates for elimination
Fastener Cost
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Select the
most
inexpensive
fastening
method
required plastic bending
riveting
screwing
snap fit
General Design Principles
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Self-fastening features
General Design Principles
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Asymmetric Part Symmetry of a partmakes assembly easier
Symmetry eliminates reorientation
General Design PrinciplesTop Down Assembly
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Top-Down Assembly
General Design PrinciplesM d l A bli
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Modular Assemblies
1. Imaging2. Drives
3. Development
4. Transfer/Stripping
5. Cleaning
6. Fusing
7. Charge/Erase
8. Copy Handling9. Electrical Distribution
10. Photoreceptor
11. Input/output Devices
Xerox photocopier
Eliminated Parts are NEVER
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Designed Detailed
Prototyped
Produced Scrapped
Tested
Re-engineered Purchased
Progressed
Received Inspected
Rejected
Stocked
Outdated
Written-off
Unreliable
Recycled
late from the supplier!
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StepThree
Identify quality(mistake proofing)opportunities
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Mistake Proofing Issues
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72 Wiring Harness
Part NumbersCDC - Rocky Mount,
NC
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Step Four
Identify handling (grasp & orientation)opportunities
Quantitative criteria
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Handling Time: based on assembly process andcomplexity of parts
How many hands are required?
Is any grasping assistance needed? What is the effect of part symmetry on assembly?
Is the part easy to align/position?
Handling Difficulty
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Size Thickness
Weight
Fragility
Flexibility
Slipperiness
Stickiness
Necessity for using 1) two hands, 2) optical
magnification, or 3) mechanical assistance
Handling Difficulty
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size slipperiness
sharpness flexibility
Eliminate Tangling/Nesting
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Step Five
Identify insertion (locate & secure)opportunities
Quantitative criteria
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Insertion time: based on difficulty required foreach component insertion
Is the part secured immediately upon insertion?
Is it necessary to hold down part to maintain location?
What type of fastening process is used? (mechanical,
thermal, other?)
Is the part easy to align/position?
Insertion Issues
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Provide self-aligning & self locating parts
Insertion Issues
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Ensure parts do not need to be held inposition
Insertion Issues
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Parts are easy to insert. Provide adequate access & visibility
Insertion Issues
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Provide adequate access and visibility
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Step Six
Identify opportunities to reduce secondaryoperations
Eliminate Secondary Operations
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Re-orientation (assemble in Z axis) Screwing, drilling, twisting, riveting, bending,
crimping.
Rivet
Eliminate Secondary Operations
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Welding, soldering, gluing.
Painting, lubricating, applying liquid or gas.
Testing, measuring, adjusting.
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Analyze All Metrics
Firstconsider:
Reduce part count & type Part Count Efficiency
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& DFA Complexity Factor
Thenthink about:Error Proofing Error Index
Thenthink about:Ease of handling Handling IndexEase of insertion Insertion IndexEliminate secondary ops. 2ndOp. Index
Set Target Values for These Measures
Steps
Your Turn...
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Complete theremaining columns &
calculate yourproductsAssemblabilityIndices
Instructions
Steps
Two -Six
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StepSeven
Analyze data for new design
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In order of importance:
DFA Guidelines
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In order of importance:
Reduce part count & types
Ensure parts cannot be installed incorrectly
Strive to eliminate adjustments
Ensure parts self-align & self-locate Ensure adequate access & unrestricted vision
Ensure parts are easily handled from bulk
Minimize reorientation (assemble in Z axis) &secondary operations during assembly
Make parts symmetrical or obviously
asymmetrical
Consideration of True Production costs and the
Understanding Product Costs
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Bill of Material Costs,Typical Costing Total Cost
Pareto by Part Cost
1. Castings $$2. Forging $$3.--------------------------------
n. Fasteners c
Pareto by Total Cost
1. Fasteners $$$$$2. -----3. --------------------------------------n. Castings $$
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Has the Design Addressed Automation
Selection of ManufacturingMethod
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g
Possibilities?
Is the Product configured
with access for and theparts shaped for theimplementation of
automation?
Part Features that are Critical To the
Understanding ComponentFeatures
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Products Functional Quality
Every Drawing
Call Out is notCritical toFunction and
Quality
Key DFMA Principles
Minimize Part Count
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StandardizeParts and Materials
Create ModularAssemblies
Design for Efficient Joining
Minimize Reorientationof parts during
Assembly and/or Machining
Simplify and Reducethe number of
Manufacturing Operations
Specify Acceptable surface Finishesfor
functionality
References
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1. Assembly Automation and Product Design
G. Boothroyd, Marcell Dekker, Inc. 1992
2. Product Design for Manufacture and Assembly
G. Boothroyd and P. Dewhurst, Boothroyd Dewhurst, Inc. 1989
Marcell Dekker, Inc. 1994
3. Design and Analysis of Manufacturing SystemsProf. Rajan Suri University of Wisconsin 1995
4. Product Design for Assembly: The Methodology Applied
G. Lewis and H. Connelly
5. Simultaneous Engineering Study of Phase II Injector Assembly line
Giddings & Lewis 19976. Design for Manufacturing Society of Manufacturing Engineers,
(VIDEO)
CHAPTER
9
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9
Product and
Service Design
McGraw-Hill/Irwin
Operations Management, Eighth Edition, by William J. StevensonCopyright 2005 by The McGraw-Hill Companies, Inc. All rights reserved.
Major factors in design strategy
Product and Service Design
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Cost Quality
Time-to-market
Customer satisfaction Competitive advantage
Product and service designor redesignshould beclosely tied to an organizations strategy
Translate customer wants and needs into
Product or Service Design Activities
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product and service requirements Refine existing products and services
Develop new products and services
Formulate quality goals Formulate cost targets
Construct and test prototypes
Document specifications
Reasons for Product or Service Design
Economic
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Social and demographic
Political, liability, or legal
Competitive
Technological
Objectives of Product and Service Design
Main focus
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Customer satisfaction Secondary focus
Function of product/service
Cost/profit Quality
Appearance
Ease of production/assembly
Ease of maintenance/service
Taking into account the capabilities of the
Designing For Operations
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organization in designing goods andservices
Legal
Legal, Ethical, and Environmental Issues
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FDA, OSHA, IRS Product liability
Uniform commercial code
Ethical Releasing products with defects
Environmental
EPA
Regulations & Legal Considerations
Product Liability - A manufacturer is liable for
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any injuries or damages caused by a faultyproduct.
Uniform Commercial Code - Products carry an
implication of merchantability and fitness.
Designers Adhere to Guidelines
Produce designs that are consistant with the
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goals of the company Give customers the value they expect
Make health and safety a primary concern
Consider potential harm to the environment
Other Issues in Product and Service Design
Product/service life cycles
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How much standardization
Product/service reliability
Range of operating conditions
Life Cycles of Products or ServicesFigure 4.1
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Time
Introduction
Growth
Maturity
Saturation
Decline
Dema
n
d
Standardization
Standardization
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Extent to which there is an absence of variety ina product, service or process
Standardized products are immediately
available to customers
Advantages of Standardization
Fewer parts to deal with in inventory &
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manufacturing
Design costs are generally lower
Reduced training costs and time More routine purchasing, handling, and
inspection procedures
Advantages of Standardization (Contd)
Orders fillable from inventory
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Opportunities for long production runs andautomation
Need for fewer parts justifies increasedexpenditures on perfecting designs andimproving quality control procedures.
Disadvantages of Standardization
Designs may be frozen with too many
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imperfections remaining. High cost of design changes increases
resistance to improvements.
Decreased variety results in less consumerappeal.
Mass customization:
Mass Customization
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A strategy of producing standardized goods orservices, but incorporating some degree
degree of customization
Delayed differentiation
Modular design
Delayed differentiation is a postponement
Delayed Differentiation
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tactic Producing but not quite completing a product
or service until customer preferences or
specifications are known
Modular Design
Modular design is a form of standardization in
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which component parts are subdivided intomodules that are easily replaced orinterchanged. It allows:
easier diagnosis and remedy of failures
easier repair and replacement
simplification of manufacturing and assembly
Reliability
Reliability: The ability of a product, part, or system
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to perform its intended function under a prescribedset of conditions
Failure: Situation in which a product, part, or
system does not perform as intended
Normal operating conditions: The set ofconditions under which an items reliability is
specified
Improving Reliability
Component design
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Production/assembly techniques
Testing
Redundancy/backup Preventive maintenance procedures
User education
System design
Product Design
Product Life Cycles
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Robust Design
Concurrent Engineering
Computer-Aided Design Modular Design
Robust Design: Design that results in
Robust Design
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products or services that can functionover a broad range of conditions
Degree of Newness
1.Modification of an existing product/service
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2.Expansion of an existing product/service
3.Clone of a competitors product/service
4.New product/service
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Idea Generation
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Ideas Competitor based
Supply chain based
Research based
Reverse Engineering
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Reverse engineeringis thedismantling and inspecting
of a competitors product to discover
product improvements.
Research & Development (R&D)
Organized efforts to increase scientific
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knowledge or product innovation & mayinvolve:
Basic Research advances knowledge about asubject without near-term expectations of
commercial applications. Applied Research achieves commercial
applications.
Developmentconverts results of applied
research into commercial applications.
Manufacturability
Manufacturability is the ease of fabrication
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and/or assembly which is important for: Cost
Productivity
Quality
Concurrent Engineering
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Concurrent engineeringis the bringing together
of engineering design and
manufacturing personnelearly in the design phase.
Computer-Aided Design
Computer-Aided Design (CAD) is product
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design using computer graphics. increases productivity of designers, 3 to 10 times
creates a database for manufacturinginformation on product specifications
provides possibility of engineering and costanalysis on proposed designs
Recycling: recovering materials for future use
Recycling
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Recycling reasons Cost savings
Environment concerns
Environment regulations
Service Design
Service is an act
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Service delivery system Facilities
Processes
Skills Many services are bundled with products
Service Design
Service design involves
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The physical resources needed The goods that are purchased or consumed by
the customer
Explicit services Implicit services
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Tangibleintangible
Differences Between Productand Service Design
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Services created and delivered at the sametime
Services cannot be inventoried
Services highly visible to customers
Services have low barrier to entry
Location important to service
Phases in Service Design
1.Conceptualize
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2.Identify service package components3.Determine performance specifications
4.Translate performance specifications into
design specifications
5.Translate design specifications into delivery
specifications
Service Blueprinting
Service blueprinting
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A method used in service design to describe andanalyze a proposed service
A useful tool for conceptualizing a service
delivery system
Major Steps in Service Blueprinting
1. Establish boundaries
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2. Identify steps involved3. Prepare a flowchart
4. Identify potential failure points
5. Establish a time frame
6. Analyze profitability
Characteristics of Well DesignedService Systems
1. Consistent with the organization mission
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2. User friendly3. Robust
4. Easy to sustain
5. Cost effective6. Value to customers
7. Effective linkages between back operations
8. Single unifying theme
9. Ensure reliability and high quality
Challenges of Service Design
Variable requirements
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Difficult to describe High customer contact
Servicecustomer encounter
Quality Function Deployment
Quality Function Deployment
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Voice of the customer House of quality
QFD: An approach that integrates the voice of the
customer into the product and service development
process.
The House of QualityFigure 4.4
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Correlationmatrix
Designrequirements
Customerrequire-ments
Competitiveassessment
Relationshipmatrix
Specificationsor
target values
X
Correlation:Strong positive
House of Quality Example
Figure 4.5
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Customer
Requirements
Easy to close
Stays open on a hill
Easy to open
Doesnt leak in rain
No road noise
Importance weighting
Engineering
Characteristics
Energyneeded
toclosedoor
Checkforce
onlevel
ground
Energyneeded
toopendoor
Waterresistance
10 6 6 9 2 3
7
5
3
3
2
X
X X
X
PositiveNegativeStrong negative
X*
Competitive evaluation
X = UsA = Comp. AB = Comp. B(5 is best)
1 2 3 4 5
X AB
X AB
XAB
A X B
X A B
Relationships:
Strong = 9
Medium = 3Small = 1Target values
Reducee
nergy
levelto7
.5ft/lb
Reduceforce
to9lb.
Reducee
nergy
to7.5
ft/lb.
Maintain
currentle
vel
Technical evaluation
(5 is best)
54321
B
A
X
BA
X B
A
X
B
X
A
BXABA
X
Doorseal
resistance
Accoust.Trans.
Window
Maintain
currentle
vel
Maintain
currentle
vel
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Shorten Time to Market
1. Use standardized components
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2. Use technology3. Use concurrent engineering
CHAPTER
11
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Value Analysis
Prof.G.Purandaran
M.Tech (I.I.T-Madras)
PGDM (I.I.M-Bangalore)
INTRODUCTION
W h
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The concept of value analysis was developed
during World War II by Lawrence D. Miles of
General Electric Company.
Worth to youValue = ------------------
Price you pay
Value Analysis is an effective tool for cost reduction and the results
li h d f
VALUE ANALYSIS
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accomplished are far greater.
It improves the effectiveness of work.
It is an organised approach to a problem.
It is value applied at the design stage itself.
It reduces unnecessary costs, obvious and hidden which can be
eliminated without adversely affecting quality, efficiency, safety andother customer features.
DEFINITION
V l A l i b d fi d
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Value Analysis can be defined as,
A process of systematic review that is applied to
existing product designs in order to compare the
function of the product required by a customer tomeet their requirements at the lowest cost
consistent with the specified performance and
reliability needed.
APPLICATION OF VALUE ANALYSIS1. Capital goods plant, equipment, machinery, tools, etc.
2. Raw and semi-processed material, including fuel.
i l h dli d i
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3. Materials handling and transportation costs.
4. Purchased parts, components, sub-assemblies, etc.
5. Maintenance, repairs, and operational items.
6. Finishing items such as paints, oils, varnishes, etc.
7. Packing materials and packaging.
8. Printing and Stationery items.
9. Miscellaneous items of regular consumptions.10. Power, water supply, air, steam & other utilities (services).
OBJECTIVES OF VALUE ANALYSIS
1) To provide better value to a product/service.
) T i th titi iti
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2) To improve the companys competitive position.
3) To ensure that every element of Cost (
Labour
Materials
Suppliers and service )
contribute equally to the Function of the product.
4) To Eliminate unnecessary Cost.
STEPS CARRYING VALUE ANALYSIS
Establish the objectives (eg, cost reduction).
Consider a team for marketing, sales, production,
h i t
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purchasing, etc.
Analyse the production process of the supplier company.
Decompose various characteristics of purchased product.
Hold a creative brainstorming session to explore allalternative possibilities.
Sort the ideas to establish the cost of each.
Select the best alternative. Develop a plan for implementing the change.
To understand value analysis it is necessary to understand some key
concepts:
th ti b t f ti f t ti f ti d
How Does It Work
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Value: the ratio between a function for customer satisfaction andthe cost of that function.
Function: the effect produced by a product or by one of its
elements, in order to satisfy customer needs.
Value analysis: methodology to increase the value of an object to
be analysed could be an existing or a new product or process, and it
is usually accomplished by a team following a work plan.
Need: something that is necessary or desired by the customer.
TECHNIQUES OF VALUE ANALYSIS
DESIGN ANALYSIS
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CHECKLIST
BRAINSTORMING
PRICE ANALYSIS
The Value Analysis Process
Value analysis is based on the application of a systematic work plan
that may be divided into various steps:
orientation/preparation
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orientation/preparation
Information
Analysis
Innovation/creativity,
Evaluation and implementation and monitoring.
The application of value analysis only needs to make use of basic
techniques such as matrixes, pareto chart, pert and gantt diagrams, etc.
In reality, a complex number of reasons exists that
necessitate the structured approach of value analysis as a
means of logical cost reduction
Why Use Value Analysis
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means of logical cost reduction.
These reasons can be divided into two
key sources,
1) those that lie within the business and secondly
1) those that are stimulated by the
market for the product or service.
SIX WHATs OF VALUE ANALYSIS
1) What is it ?
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1) What is it ?2) What does it do ?
3) What does it cost ?
4) What is it worth ?5) What else will do the job ?
6) What does that cost ?
THE PHASES OF VALUE ANALYSIS JOBPLAN
SELECTION & ORIENTATION
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ANALYSIS
RECORDING IDEAS
SPECULATION
INVESTIGATION
RECOMMENDATION
IMPLEMENTATION
BENEFITS TO BE ACHIEVED BY VALUEANALYSIS
Better purchasing techniques
Better suppliers & manufacturing methods
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Better suppliers & manufacturing methods
Lower operating costs
Standardisation & re-evaluation
Substitution & packaging
Better material handling
Better inventory control
Lower maintenance & overhead cost
Value analysis is a technique with immense possibilities, and
systematically employed, it can achieve great economies and increased
efficiency.
Although good results have been obtained in several individual cases in
CONCLUSION
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Although good results have been obtained in several individual cases insome industries, only a large scale and systematic application of this
technique in all industries, and in defence production, can result in
substantial economies on a national scale.
To conclude, we can say that benefits of value analysis include,
Reduced production cost,
Materials and distribution cost,
Improved profit margin,
Increased customer satisfaction.
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