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11Manufacturingprocesses2.pptxManufacturing Processes:
Product-process Matrix, MTO/ATO vs. MTS, Mass Customization
John Wu, Ph.D.
Professor of Supply Chain and Transportation
CSU San Bernardino
1
Manufacturing
Some time in the 1990s, the service sector in the U.S. started to outpace the manufacturing sector
Deindustrialization in the developed world and the rise of manufacturing in the developing world followed
The rise of flexible production systems, automation/robotics, business process outsourcing & downsizing
Latest resurgence of manufacturing in the U.S. or re-shoring or nearshoring
As economy develops, manufacturing that is polluting the environment, uses a lot of manual labor, and adds little value will move to less developed countries while services at higher levels will increase. What are some of these manufacturing industries that are disappearing or have disappeared, and what services are being added in economies like the one in the U.S.?
2
Shares of Manufacturing Value Added
Source: World Bank World Development Indicators, 2011
3
Deindustrialization in Industrialized Countries
The Share of Mfg. may have fallen, but real mfg. output is up in all these countries.
4
U.S. & Canadian
Manufacturing
Belt: about
Two-thirds of
Total
Manufacturing
Employment in
The U.S. and
Canada
Rise of
Maquiladoras –
Border & interior
Mexico
A good
Overview
Of specialized
Versus market
Oriented
manufacturing
Where is California in this map? What role(s) is CA playing in manufacturing?
5
Growth of industrial robots
Introduction to Manufacturing Processes
Principles Of EngineeringTM
Unit 3 – Lesson 3.2 Material Properties
Project Lead The Way, Inc.
Copyright 2009
6
Product Creation Cycle Design → Material Selection → Process Selection → Manufacture → Inspection → Feedback
Typical product cost breakdown
Products and Manufacturing
Introduction to Manufacturing Processes
Principles Of EngineeringTM
Unit 3 – Lesson 3.2 Material Properties
Project Lead The Way, Inc.
Copyright 2009
7
Custom, or make-to-order (MTO), goods and services are designed to meet specific customers’ specifications then produced and delivered as one-of-a-kind or in small quantities.
Examples: ships, weddings, certain jewelry, estate plans, buildings, and surgery.
Option, or assemble-to-order (ATO), goods and services are configurations of standard parts, subassemblies, or services that can be selected by customers from a limited set.
Examples: Dell computers, Subway sandwiches, machine tools, and travel agent services.
Process Choice Decisions –
MTO and ATO
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MTO and ATO are customized but MTO has more flexibility as everything is made from scratch whereas ATO is done with readily available parts. ATO is easier and faster to make at lower costs while presenting something that looks like every bit customized.
Standard, or make-to-stock (MTS), goods and services are made according to a fixed design, and the customer has no options from which to choose.
Examples are appliances, shoes, sporting goods, credit cards, online Web-based courses, and bus service.
Process Choice Decisions –
MTS
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MTS is the most popular product/service out there, mass produced, inexpensive, and ready to be consumed.
Manufacturing Process
A sequence of operations and processes designed to create a specific product or service. The process of turning materials into a product
Introduction to Manufacturing Processes
Principles Of EngineeringTM
Unit 3 – Lesson 3.2 Material Properties
Project Lead The Way, Inc.
Copyright 2009
10
Projects and job shops are flexible and capable of customizing work for individual customers. They may consist of many smaller tasks and activities that must be coordinated and completed to finish on time and within budget.
Characteristics: One-of-a-kind, complex and large scale at times, wide variation in specs and tasks.
Examples: Legal service, construction, customer jewelry, consulting, surgery, hair cut, and software development.
Manufacturing Processes
11
Can you identify 3 different products which are manufactured using job production then explain the costs and benefits of it?
Assembly Lines are organized around a fixed sequence of activities and process steps to produce a limited variety of similar goods or services.
Characteristics: specialized equipment dedicated to producing large quantity of goods or services that are similar, using similar sequence of process steps.
Examples: Assembly lines that produce automobiles and appliances, production of insurance policies and checking account statements, and hospital laboratory work.
Manufacturing Processes
12
Distinguish between assembly line and continuous flow, explain the advantages and disadvantages of batch production.
A continuous flow process creates highly standardized goods or services, usually around the clock in very high volumes.
Characteristics: Very high volumes in a fixed processing sequence, high investment in system, 24-hour/7-day continuous operation, automated, dedicated to almost identical goods or services.
Examples: Chemical, gasoline, electricity, municipal water supply, steel factories.
Manufacturing Processes
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What’s the Difference?
Soccer team car wash
Jiffylube
Shade tree mechanic
Fairway car wash
Vs.
Vs.
List as many similarities and differences as you can between the two types.
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Reengineering is “the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed.”
Process Analysis and Improvement
Value Added
Non-Value Added
Non-Value Added
Value Added
Value Added
Status Quo
Reengineered
Value Added
Non-Value Added
Non-Value Added
Value Added
Value Added
15
Can you think of an example in your life where you have “reengineered” something?
