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Chapter 5

Production Technology:
Selection and Management

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Overview

 Introduction
 Proliferation of Automation
 Types of Automation
 Automated Production Systems
 Factories of the Future
 Automation in Services
 Automation Issues
 Deciding Among Automation Alternatives
 Wrap-Up: What World-Class Producers Do

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Introduction

 In the past, automation meant the replacement of


human effort with machine effort.
 Today, automation means integrating a full range of
advanced information and engineering discoveries
into production processes for strategic purposes.

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Advanced Production Technology

 Types of Automation
 Automated Production Systems
 Factories of the Future
 Automation in Services
 Automation Issues
 Decision Approaches

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Types of Automation

 Machine Attachments - one operation


 Numerically Controlled (N/C) - reads computer or
tape inputs
 Robots - simulates human movements
 Automated Quality Control - verifies conformance to
specifications
 Auto ID Systems - automatic acquisition of data
 Automated Process Control - adjusts processes per set
parameters

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Automated Production Systems

 Automated Flow Lines (Fixed Automation)


 Automated processes linked by automated material
transfer
 Automated Assembly Systems
 Automated assembly processes linked by
automated material transfer
 Flexible Manufacturing Systems (FMS)
 Groups of processes, arranged in sequence,
connected by automated material transfer, and
integrated by a computer system

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Volume & Variety of Products
Volume & Variety Low Volume High Repetitive High Volume Low
of products Variety Process process Variety Process
(Intermittent) (modular) (Continuous)
One or very few Project Poor strategy
units per lot (Fixed costs and
cost of changing
to other products
Very small runs, Job shop are high)
high variety
Modest runs, Disconnected
modest variety Repetitive
Long runs, Connected
modest variations Poor Strategy Repetitive
Very long runs, (High variable Continuous
changes in costs)
attributes
Equipment 5%-25% 20%-75% 70%-80%
utilization
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Process Design Depends on
Product Diversity and Batch Size

Product This is an area of today’s


Focused, automation programs
Dedicated
Systems
Batch Size

Product
Focused,
Batch
System
Cellular
Manufacturing
Process-Focused,
Job Shop

Number of Product Designs


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Flexible Manufacturing System
Products

General
purpose
1000
Work cells
CIM

100 Flexible
Manufacturing Focused
System automation
10
Dedicated
automation
1
1 10 100 1000 10000 100000 1000000
Volume

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Design Products for Automation

 Reduce amount of assembly required..fewer parts


 Reduce number of fasteners needed
 Design parts to be automatically delivered/positioned
 Design for layered assembly... base to top
 Design parts to self-align
 Design parts into major modules
 Increase quality of components to avoid jams

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Material-Handling Automation

 Automated Storage & Retrieval System (ASRS)


 Receive orders, pick parts, maintain inventory
records
 Benefits: increase storage density and throughput,
reduce labor costs, improve product quality
 Drawbacks: added maintenance costs
 Automated Guided Vehicle (AGVS)
 Follows wire or track in floor. Newer versions use
sensors placed around the factory to figure out
where they are.

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Material Handling (continued)

 Don’t build monuments to manage inventory!


 Most factories moving towards point-of-use stocks
 Receiving docks built all around the exterior of
buildings

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Computer-Based Systems

 Computer-Aided Design (CAD) - Use of computer in


interactive engineering drawing and storage of
designs
 Computer-Aided Manufacturing (CAM) - Use of
computers to program, direct and control processes
 CAD/CAM - merger and interaction between the two
systems

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Computer Integrated Manufacturing (CIM)

 Incorporates all manufacturing processes

ASRS
AGV

Automated
NC
Assembly
Machining

Order Entry
CAD/CAM

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Characteristics of Factories of the Future

 High product quality


 High flexibility
 Fast delivery of customer orders
 Changed production economics
 Computer-driven and computer-integrated systems
 Organization structure changes

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Automation in Services

 Trend developing toward more-standardized services


and less customer contact.
 Service standardization brings trade-offs:
 Service not custom-designed for each customer
 Price of service reduced, or at least contained
 Banking industry is becoming increasingly automated
 Service firm can have a manual/automated mix:
 Manual - “front room” operations
 Automated - “back room” operations

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Automation Issues

 Not all automation projects are successful.


 Automation cannot make up for poor management.
 Economic analysis cannot justify automation of some
operations.
 It is not technically feasible to automate some
operations.
 Automation projects may have to wait in small and
start-up businesses.

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Automation Questions

 What level of automation is appropriate?


 How would automation affect the flexibility of an
operation system?
 How can automation projects be justified?
 How should technological change be managed?
 What are some of the consequences of implementing
an automation project?

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Watch Out For !!!

 Success .... many projects are not... high tech skills


required to manage advanced technologies
 Technical feasibility.... There always are bugs with
new technology
 Economic analysis ... include both qualitative and
quantitative

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Managing Technological Change

 Have a master plan for automation.


 Recognize the risks in automating.
 Establish a new production technology department
 Allow ample time for completion of automation.
 Do not try to automate everything at once.
 People are the key to making automation successful.
 Don’t move too slowly in adopting new production
technology; you might loose your competitive edge.

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Deciding Among Automation Alternatives

Three approaches commonly used in industry:


 Economic Analysis

 Rating Scale Approach

 Relative-Aggregate-Scores Approach

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Economic Analysis

 Provides an idea of the direct impact of automation


alternatives on profitability.
 Break-even analysis and financial analysis are
frequently used.
 Focus might be on:
 cash flows
 variable cost per unit
 annual fixed costs
 average production cost per unit

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Rating Scale Approach

Automation alternatives are rated using, say, a five-


point scale on a variety of factors such as:
 Economic measures

 Effect on market share

 Effect on quality

 Effect on manufacturing flexibility

 Effect on labor relations

 Amount of time required for implementation

 Effect on ongoing production

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Relative-Aggregate-Scores Approach

 Similar to Rating Scale Approach, but weights are


formally assigned to each factor which permits the
direct calculation of an overall rating for each
alternative.

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Wrap-Up: World-Class Practice

 World-Class producers utilize the latest


technologies/practices. For example:
 Design products to be automation-friendly
 Use CAD/CAM for designing products
 Convert fixed automation to flexible automation
 Move towards smaller batch sizes
 Plan for automation
 Build teams to develop automated systems
 Justify automation based on multiple factors

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