00:00>> >> Your textbook presents a conceptual overview of process choice options necessary
00:25>> to meet different volume and demand characteristics from consumers.
00:31>> From made-to-order burritos and custom screen printing to colorful crayons and major oil
00:37>> and gas production, organizations must choose the process
00:41>> that best meets the needs of their operations.
00:45>> Each process structure is matched to the demand characteristics
00:48>> of the products being produced.
00:51>> Your textbook describes FOUR manufacturing process design choices-Job,
00:57>> Batch, Line and Continuous Flow.
01:03>> To better understand the differences between these structures, let's take a quick look
01:07>> at examples of each one, starting with a JOB process.
01:12>> At SOME BURROS Mexican Restaurant, the kitchen represents a Job Process similar
01:18>> to those found in many manufacturing firms.
01:21>> Each order is different and can be customized
01:24>> to meet specific requirements of every customer.
01:28>> Customers may choose from the extensive menu,
01:31>> but many choose to have the kitchen custom-build their meal.
01:35>> A new order comes to the kitchen every three minutes, on average,
01:38>> and each one must be hand-prepared.
01:42>> For example, as the customer places an order for a burrito, the kitchen gets the request
01:48>> and staff will start to assemble it from the fresh ingredients prepped earlier in the day.
01:54>> Process Divergence is high as each burrito is put together differently
01:58>> at every stage of the process.
02:01>> Even though each burrito is unique, SOME BURROS represents an environment
02:05>> where a job process supports both made-to-order
02:08>> and assemble-to-order strategies.
02:11>> This process is highly labor-intensive, with little mechanization required
02:16>> for making the finished burritos.
02:18>> During peak demand times, additional capacity is added with more labor, not machinery.
02:25>> People are the key to meeting the restaurant's 7-minute order completion goal.
02:29>> A job process, then, is characterized by LOW VOLUME, HIGH RESOURCE FLEXIBILITY,
02:37>> HIGH Customer involvement, and LESS capital intensity.
02:43>> Next is a BATCH PROCESS.
02:47>> Here at WT Graphix custom embroidery and silk screening,
02:51>> each wholesale customer order is considered a single batch, and may consist of a handful
02:56>> of shirts or caps, or larger lots depending on customer needs.
03:01>> The process starts with the development of the customer's graphic design,
03:04>> and then moves into production to make the batch order.
03:08>> Each shirt, for example, follows the same routing as any other customer's shirt order,
03:13>> however the processes must be set for each customer's specific requirements.
03:18>> As customers replenish their stock, repeat orders come in over time,
03:23>> and the batch process is repeated.
03:26>> Flexibility is key, and skill is essential to be sure
03:30>> that finished goods are consistent and meet quality expectations.
03:34>> Demand varies, based upon each customer's order requirements.
03:39>> Once a design is stored in the system, it may be used again
03:42>> for the next batch ordered by the customer.
03:46>> Batch processes can be started and stopped quickly,
03:49>> with moderate flexibility and customization options.
03:52>> Some automation is involved, as you see here
03:55>> with the sewing machines and silk screening machines.
03:58>> But people play a larger role in setting up, monitoring
04:01>> and controlling each batch as it moves to completion.
04:04>> Capacity expansion, such as adding another silk screening press,
04:09>> is easier in such a setting.
04:13>> Compared to a JOB process, a BATCH process has higher volume of each type
04:17>> of product manufactured repetitively, moderate flexibility as batches
04:22>> of other products are also made on the same equipment,
04:26>> moderate degree of customer involvement, and moderate capital intensity.
04:32>> The third process choice is a LINE process.
04:35>> A LINE process produces few highly homogenous products.
04:41>> Here at CRAYOLA, crayons are manufactured
04:44>> in long production runs using a high degree of automation and machinery.
04:49>> Raw materials are pulled into production by the master schedule to meet the demands
04:53>> of its three seasons - back to school, holiday, and spring.
04:59>> The crayon production lines generate 150 crayons per second,
05:03>> or 13 million crayons per year, with human labor used only to add ingredients
05:08>> to the mixing vats at the start of production, and then to scoop the crayons
05:12>> into totes at the end of the line.
05:16>> To summarize the LINE Process, we see high volume, low resource flexibility
05:22>> with line flows, less customer involvement, and high capital intensity.
05:29>> The fourth process choice is CONTINUOUS FLOW.
05:36>> A good example of this manufacturing structure is the oil and gas industry.
05:42>> It is characterized by high-volume standardized production with rigid line flows
05:47>> and the output is considered to be a commodity.
05:50>> Equipment is specialized, and both process flow and workforce have very low flexibility.
05:57>> It differs from a LINE process in that materials will flow
06:00>> through the entire process without stopping for days, weeks or even months.
06:07>> Continuous line flow processes have extremely high volume, very low flexibility,
06:14>> no customer involvement, and very high capital intensity.
06:20>> The product-process matrix in your textbook provides additional detail
06:23>> on how customer involvement, resource flexibility, and capital intensity change
06:29>> with these four manufacturing process choice structures.