Fate Design of Production Process08

8/3/2019 Fate Design of Production Process08

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Design of Production

Process/Service Chain

for Participants'

Companies

Presented at the FATEFoundation by Samuel J.

Okoro, CEO Leapfrog AllianceLtd on 31st May 2008



Objectives

At the end of this class participants will beable to:

Have a clear picture of the flow of theproduction/service operations

Create top-level process maps of their

production processes/service chains Make rough-cut estimates of resource

capacity requirements



Purpose of Design

Imagine you went into a shop to buy … a money making machine

How would you decide which of themodels on sale you would choose?



Purpose of Design

You might want to know what “speed” of themachine is. How much money can it make perminute, hour, day, week etc? Throughput

You might be interested in the cost of themachine Investment

You might also be interested in what it wouldcost you to operate the machineOperating expense



Purpose of Design

YOU ALREADY OWN SUCH A MACHINE

… YOUR BUSINESS



Purpose of Design

Maximize throughput(Taichi Ohno of

Toyota) Maximize returns

Reduce costs

Eliminate wastes

Your business is

essentially a money

generation machine

investment

operating cost throughput



The Seven Deadly Wastes

Over production

Over processing

Excessive Work InProcess

Waiting*

Excessive transportation

Excessive movement Defects



Design Steps

Determine theproduct/service

Outline mainprocesses

Determinerequirements/layout

Operate the chain

Adjust capacity/schedulearound leverage point

Select/identifyleverage point



Creation of goods and services takesplace within a value chain

The Value Chain

from supplier To customer



The Value Chain

process process process

This chain is made up of processes



The European Network for Advanced

Performance Studies Model

Product/serviceDevelopment

Obtaining Customer

Commitment Order Fulfillment

Customer Service

Support Processes

EvolutionProcesses

ENAPS Generic Framework

Business Processes Secondary Processes

forward



Product/Service Development

Product/service research

Product/service design

Process design

back



Obtaining Customer

Commitment Market development

Marketing and sales

Tendering

back



Order Fulfillment

Procurement and inbound logistics

Production planning and control

Manufacturing and assembly

Distribution and outbound logistics

Order processing

back



Customer Service

After sales service

Product returns

back



Support

Financial management

HR management

Maintenance

Information management

Health, Safety and Environment

back



Evolution

Continuous business processimprovement

Product research Technology research

Human Resource development

Supplier base development Development of external relations

Strategic planningback



In terms of the ENAPS model, the designof the production process/service chain

falls under “order processing” This is where the physical product is

produced or the service is created and

consumed



Examples

My consulting service

Poultry operation

Other examples



My Consulting Service

Create ServiceOffering

Follow UpEngage ClientBuild

Relationship

Create awareness& Generate

interest

QualifyProspects

Deliver

Service



Poultry Operation (Broilers)

Purchase DayOld Chicks Grow to Target Weight

Purchase Feed & Other Inputs

Create Awareness Among & Get Commitment fromPotential Buyers

Sell

Deliver



Cyber Café/Business Centre

Customer

Café

Assistant

Manager

Biz Center

Operators

Accounts

Officer

walk in

receive

cash

issue

ticket

browse

register

ticket

collate

reports/cash

execute

jobs

issue

receipt

report

trxns



Exercise 1

Draw a map of your production process orservice chain as it is currently or as you

have envisioned it.



Operations - Layout

Properly designed layouts for operations help tominimize two wastes Excessive movement

Excessive transportation

The general approach is to ensure thatsequential operations/activities are in physicalproximity

Materials and tools must be located at or neartheir point of use



Exercise 2

If you are already operating, draw a layoutof your operations

Identify areas of unnecessary movementor transportation

List adjustments you can make to

minimise this waste



Leverage Points and Resource

Capacities The manufacturing operation shown below uses

5 resources

Let their capacities (units per hour) be as shown What is the maximum output we can expect from

the manufacturing line?

450 510 330 275 350 Demand =300/hour



Leverage Points and Resource

Capacities Assuming the red resource (sewing) can

process work at the rate of 10 units per hour,

what should be the capacity of the otherresources?

2 43 51

Cutmaterials

Matchpieces Sew Accessories Press

6

Pack



Resource Capacity Requirements

The slowest resource (also known as the capacityconstraint) dictates the pace of operations – whether ornot this is planned.

The constraint resource must at least be able to meet market demand. Otherwise, there is loss of potential throughput.

All resources before the constraint must, by definition, beable to work faster.

This protects the system against uncertainties byensuring the constraint resource is never starved ofwork.



Managing Around the Leverage

Point The constraint resource is the leverage point in

the production/service operation

Five rules must be followed Identify (or select) the leverage point

Exploit the leverage resource

Subordinate everything else to the above decision

Increase the capacity of the leverage resource

Go back to the first rule




Point Determine the demand

Create a schedule for the leverage resource

based on the demand Determine when materials should enter the

gating operation, in accordance to the scheduleat the leverage resource

Expedite, when materials are not at the leverageresource at the expected times




Point and the Seven Wastes Managing around the leverage point

protects against three out of the seven

deadly wastes:Overproduction

Waiting (at the constraint, which is the only

place where it has any impact)Excessive work in process inventory



Exercise 3

Look at your process again and locateareas where any of the following deadly

wastes occur or might occurOver production

Excessive work in process

Waiting

What can you do to reduce the incidenceof these wastes?



Conclusion

Designing your production/servicechain involves decisions about:

Overall operations sequenceResource capacities

Operations scheduling

Operations layout



Conclusion

A well designed product/service chainwill help you achieve:

Maximum throughputMaximum returns

Minimum costs

Reduced waste



THANK YOUwww.leapfrogalliance.com

[email protected] 629 6415, 01- 741 7683

First Floor Tapa House

4/5 Imam Dauda Street, Off Eric Moore Rd.,

S r lere

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Fate Design of Production Process08