Capacity

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is the upper limit or ceiling on the load that an operating unit can handle.

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Capacity

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maximum output rate or service capacity an operation, process, or facility is designed for

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Design capacity

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Design capacity minus allowances such as personal time, maintenance, and scrap

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Effective capacity

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* rate of output actually achieved--cannot & exceed effective capacity.

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Actual output

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- builds capacity when demand exceeds current capacity.

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Following strategy

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is similar to a following strategy, but it adds capacity in relatively small increments to keep pace with increasing demand

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Tracking strategy

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builds capacity in anticipation of future demand increases.

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Leading capacity strategy-

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- extra demand intended to offset

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Capacity cushion

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* If the output rate is less than the optimal level, increasing output rate results in decre

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Economies of scale

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* If the output rate is more than the optimal level, increasing the output rate results in increasing average unit costs

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Diseconomies of scale

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- the difference between cash received from sales and other sources, and cash outflow for labor, material, overhead, and taxes

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Cash Flow

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- the sum, in current value, of all future cash flows of an investment proposal.

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Present Value

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-the length of time it will take for an investment to return its original cost.

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Payback

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• refers to deciding on the way production of goods or services will be organized.

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Process Selection

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: The mix of equipment and labor that will be used by the organization.*

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Capital Intensity

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The degree to which the system can be adjusted to changes in processing requirements due to such B factors as changes in product or service design, changes in volume processed, and changes in technology.

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Process Flexibility:

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are inversely related; a higher level of one means a lower level of the other.

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Volume and variety

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The need for flexibility of personnel and equipment is directly related to the level of variety that the process will need to handle: The lower the variety, the less the need for flexibility, while the higher the variety, the greater the need for flexibility.

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Volume and variety

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means either having dedicated operations for each different product or service, or having to get equipment ready every time there is the need to change the product being produced or the service being provided.

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Variety

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processing is used when a moderate volume of goods or services is desired, and it can handle a moderate variety in products or services.

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Batch

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The equipment need not be as flexible as in a job shop, but processing is still intermittent.

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Batch

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The skill level of workers doesn't need to be as high as in a job shop because there is less variety in the jobs being processed.* Example of batch systems include bakeries, which make bread, cakes, or cookies in batches.

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Batch

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•When higher volumes of more standardized goods or services are needed, repetitive processing is used.

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Repetitive

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•The standardized output means only slight fexibility of equipment is needed•Skill of workers is generally low.

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Repetitive

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•Examples of this type of system include production lines and assembly lines.This type of process is sometimes referred to assembly.Familiar products made by these systems include automobiles, television sets, pencils, and computers.

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Repetitive

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When a very high volume of non-discrete, highly standardized output is desired, a continuous system is used.

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Continuous

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* These systems have almost no variety in output and hence, no need for equipment flexibility.* Workers' skill requirements can range from low to high, depending on the complexity of the system and the expertise workers need.

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Continuous

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* Generally, if equipment is highly specialized, worker skills can be lower.* Examples of non-discrete product made in continuous systems include petroleum products, steel, sugar, f bur, and salt.

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Continuous

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is used for work that is non-routine, with a unique set of objectives to be accomplished in a limited time frame.Examples range from simple to complicated, including of activities such things as putting on a play, consulting, making a motion picture, launching a new product or services, publishing a book, building a dam, and building a bridge.Equipment fexibility and worker skills can range from low to high.

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Project

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linking key product or service requirements to process capabilities.* It can be used to avoid any inconsistencies by identifying key product or service dimensions and then selecting appropriate processes.* Key dimensions often relate to the range of products or services that will be processed, expected order sizes, pricing strategies, expected frequency of schedule changes, and order-winning requirements.

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Product or service profling

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" is the creation of goods and services using processes and systems that are: non-polluting; conserving of energy and natural resources; economically ef tient; safe and healthful for workers, communities, and consumers; and socially and creatively rewarding for all working people."

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Sustainable Production

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* One principle of particular interest here is waste reduction, which relates to sustainability objectives.

inventory and f bor space; quicker response times and shorter lead times; reduced defects, rework, and scrap; and increased productivity.

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Lean Process Design

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also focuses on variance reduction in workload over the entire process to achieve level production and thereby improve process flow.* Successful lean design results in reduced

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Lean Process Design

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refers to the discovery and development of new or improved products, services, or processes for producing or providing them.

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Technological innovation

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is the science and use of computers and other electronic equipment to store, process, and send information.

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Information technology (IT)

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includes methods, procedures, and equipment used to produce goods and provide services. This not only involves processes within an organization, it also extends to supply chain processes.

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Process technology

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is machinery that has sensing and control devices that enable it to operate automatically.Automation can range from factories that are completely automated to a single automated operation.

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Automation

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is the least flexible. Ko• It uses high-cost, specialized equipment for a fed sequence of operations.Low cost and high volume are its primary advantages;Minimal variety and the high cost of making major changes in either product or process are its primary limitations.

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Fixed automation

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- involves the use of high-cost, general-purpose equipment controlled by a computer program that provides both the sequence of operations and specific details about each operation.

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Programmable automation

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This type of automation has the capability of economically producing a fairly wide variety of low volume products in small batches.

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Programmable

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machines and some robots are applications of programmable automation.

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Numerically controlled

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machines are machines that perform operations by following mathematical processing instructions.

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Numerically controlled (N/C)

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refers to the use of computers in process control, ranging from robots to automated quality control.

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Computer-aided manufacturing (CAM)

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Individual machines often have their own computer; this is referred to as

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computerized numerical control (CNC).

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One computer may control a number of N/C machines, which is referred to as

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direct numerical control (DNC).

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- evolved from programmable automation.* It uses equipment that is more customized than that of programmable automation.

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Flexible automation

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is a group of machines that include supervisory computer control, automatic material handling, and robots or other automated processing equipment.

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flexible manufacturing system (FMS)

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is a system for linking a broad range of manufacturing activities through an integrating computer system.

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Computer-integrated manufacturing (CIM)

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is a type of industrial robot that is controlled using computer assisted design (CAD).

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A 3D printer

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, also known as additive manufacturing, involves processes that create three-dimensional objects by applying successive layers of materials to create the objects

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3D printing

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refers to a wide range of techniques such as extrusion (the deformation of either metal or plastic forced under pressure through a die to create a shape) and sintering (using heat or pressure or both to form a solid material from powder without causing it to liquefy).neness

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3D printing

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Customers can create unique designs for standard goods

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Mass customization:

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- The process of assigning tasks to workstations in such a way that the workstations have approximately equal time requirements.

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Line balancing

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- The maximum time allowed at each workstation to complete its set of tasks on a unit.

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Cycle time

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: To obtain task groupings that represent approximately equal time requirements

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Goal

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Process layouts are common in services due mainly to the high degree of variety in customer processing requirements.
Examples include hospitals, supermarkets and department stores, vehicle repair centers, and banks.

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Service Layouts

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* As is the case with manufacturing, service layouts can often be categorized as product, process, or fixed-position layouts.* In a fixed-position service layout (e.g., appliance repair, roofing, landscaping, home remodeling, copier service), materials, labor, and equipment are brought to the customer's residence or office.

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Service Layouts

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organized sequentially, with all customers or work following the same or similar sequence, as it is in a car wash or a cafeteria line, a product layout is used.

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Service Layout

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Groupings are determined by the operations needed to perform work for a set of similar items, or part families, that require similar processing.The cells become, in effect, miniature versions of productlayouts.

• The cells may have no conveyorized movement of parts between machines, or they may have a f bw line connected by a conveyor (automatic transfer).chess

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Cellular Layouts

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is a type of layout in which workstations are grouped into what is referred to as a cell.

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Cellular production

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* The three basic layout types are ideal models, which may be altered to satisfy the needs of a particular situation.

* It is not hard to find layouts that represent some combination of these pure types.

* Ideally, a system is flexible and yet ef tient, with low unit production costs.

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Combination Layouts

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, the item being worked on remains stationary, and workers, materials, and equipment are moved about as needed.
Almost always, the nature of the product dictates this kind of arrangement: Weight, size, bulk, or some other factor makes it undesirable or extremely difficult to move the product.*

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Fixed-Position Layouts

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are used in large construction projects (buildings, power plants, dams), shipbuilding, and production of large aircraft and space mission rockets.

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Fixed-position layouts

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: Local 3D printing centers that can produce goods on demand for pickup

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Distributed manufacturing

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: Rapid fabrication of a scale model of a physical part or assembly

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Rapid prototyping

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: Inexpensive production of one or a small number of items

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Rapid manufacturing

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: Tools and parts can be made on the international space station as needed instead of the cost and time needed to transport them from earth

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Space exploration

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: Automotive parts, and replacement parts at repair shops; airplane parts and spare parts; also, combine multiple parts into a single part

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Vehicles

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are remotely-controlled unmanned aircraft, usuallysmall.

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Drones

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: Architectural scale models

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Construction

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: Candy, chocolate, crackers, and pasta

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Food products

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An important beneft is providing an "eye-in-the-sky" to obtain visual detail in places that are hazardous to humans or that are not readily accessible.

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Drone

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An important beneft is providing an "________" to obtain visual detail in places that are hazardous to humans or that are not readily accessible.

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eye-in-the-sky

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* Flexible systems and equipment are often more expensive and not as efficient as less flexible alternatives.

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Process Strategy

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In certain instances, flexibility is unnecessary because products are in mature stages, requiring few design changes, and there is a steady volume of output.

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Process strategy

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, the lines are referred to as production lines or assembly lines, depending on the type of activity involved.

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Manufacturing environment

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* is a standardized layout arranged according to a fixed sequence of production tasks.

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Production line

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is a standardized layout arranged according to a fixed sequence of assembly tasks.

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Assembly line

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the term line may or may not be used.

It is common to refer to a cafeteria line as such but not a car wash, although from a conceptual standpoint, the two are nearly identical.

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Service process

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has a number of advantages that make it worthy of consideration.
One disadvantage of a long, straight line is that it interferes with cross-travel of workers and vehicles.

is more compact; it often requires approximately half the length of a straight production line.

permits increased communication among workers on the line because workers are clustered, thus facilitating teamwork

line minimizes material handling.

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U SHAPE LINE

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* Process layouts are layouts that can handle varied processing requirements.

* Process layouts (functional layouts) are designed to process items or provide services that involve a variety of processing requirements.

* Intermittent processing- means non-repetitive processing.

* The layouts feature departments or other functional groupings in which similar kinds of activities are performed.

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Non-repetitive Processing

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are designed to process items or provide services that involve a variety of processing requirements.

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Process layouts (functional layouts)

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1. Impacts ability to meet future demands2. Affects operating costs3. Major determinant of initial costs4. Involves long-term commitment5. Affects competitiveness6. Affects ease of management7. Globalization adds complexity8. Impacts long range planning

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Importance of Capacity Decisions

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Importance of Capacity Decisions

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1. Impacts ability to meet future demands2. Affects operating costs3. Major determinant of initial costs4. Involves long-term commitment5. Affects competitiveness6. Affects ease of management7. Globalization adds complexity8. Impacts long range planning

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Capacity PlanningDeterminants of Effective Capacity

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* Facilities* Product and service factors* Process factors* Human factors* Operational factors* Supply chain factors* External factors

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Strategy FormulationThree primary strategies:

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* Leading capacity strategy* Following strategy * Tracking strategy

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Key Decisions of Capacity Planning

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1. Amount of capacity needed2. Timing of changes3. Need to maintain balance4. Extent of flexibility of facilities

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Make or Buy

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1. Available capacity2. Expertise3. Quality considerations4. Nature of demand5. Cost6. Risk

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Financial Analysis

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* Cash Flow - * Present Value - .* Payback -

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Key aspects include:*

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Capital Intensity Process Flexibility

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There are five basic process types:

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* Job Shop* Batch* Repetitive* Continuous, and* Project

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Three Kinds of Automation

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1. Fixed automation- 2. Programmable automation- 3. Flexible automation