Quiz 6: Processes and Technology
Important issues in process design include types of processes, process planning, analysis and innovation, and technology decisions. Process planning determines how a product will be produced or a service provided. It decides which components will be made in-house and which will be purchased from a supplier, selects processes, and develops and documents the specifications for manufacture and delivery. The type of production process selected depends primarily on demand volume and degree of product standardization. Projects are produced one at a time to customer order. Batch production is used to process a variety of low- volume jobs. Mass production produces large volumes of a standard product for a mass market. Continuous production is used for very high-volume commodity products. Several quantitative techniques are available for selecting a process. One that bases its decision on the cost trade-offs associated with demand volume is break-even analysis. The components of break-even analysis are volume (the level of production), cost (both fixed and variable), revenue (the price at which an item is sold), and profit (the difference between total revenue and total cost).
Process analysis is the systematic examination of all aspects of a process to improve its operation. The basic tools of process analysis are process flowcharts, diagrams, and maps. The classic process flowchart looks at the manufacture of a product or delivery of a service from a broad perspective. By incorporating non-productive activities as well as productive activities, process flowcharts may be used to analyze the efficiency of a series of processes and to suggest improvements. They also provide a standardized method for documenting the steps in a process and can be used as a training tool. Process maps are so named because they map out the activities performed by various people in the process. They often include a time scale as well.
Sometimes a process needs to be completely redesigned, which is referred to as process innovation. These types of projects are typically chartered in response to a breakthrough goal for rapid, dramatic improvement in process performance. The first step in this process is establishing the goals for process performance. After the general concept of redesign is agreed on, a detailed map is prepared for each subprocess or block in the high-level map-blocks are added only if an activity can contribute to the output goal. The detailed map guides decisions on allocation of resources and work methods. When the team is satisfied that the performance objective can be reached with the new design, a pilot study is conducted. After a successful pilot study, full-scale implementation can begin.