Process Design and

Analysis
 Repetitive Manufacturing Works
at Harley Davidson

• Since Harley-Davidson’s founding in Milwaukee in 1903, it has

competed with hundreds of manufacturers, foreign and domestic. The
competition has been tough. Recent competitive battles have been with
the Japanese, and earlier battles were with the German, English, and
Italian manufacturers. But after over 110 years, Harley is the only major
U.S. motorcycle company. The company now has five U.S. facilities and
an assembly plant in Brazil. The Sportster powertrain is manufactured in
Wauwatosa, Wisconsin, and the sidecars, saddlebags, windshields, and
other specialty items are produced in Tomahawk, Wisconsin. The Touring
and Softail bikes are assembled in York, Pennsylvania, while the
Sportster models, Dyna models, and VRSC models of motorcycles are
produced in Kansas City, Missouri.
• As a part of management’s lean manufacturing effort, Harley groups
production of parts that require similar processes together. The result is
work cells. Using the latest technology, work cells perform in one
 Wheel assembly modules are prepared in a work cell for JIT delivery For manufacturers like Harley-Davidson, which produces a large number
to the assembly line. of end products from a relatively small number of options, modular bills
of material provide an effective solution.

Engines are assembled in Memomonee Falls, Wisconsin, and placed in their own
protective containers for shipment to the York facility. Upon arrival in York, engines are It all comes together on the line. Any employee who spots a problem has the authority to stop the line until
placed on an overhead conveyor for movement directly to the assembly line. the problem in corrected. The multicolored “andon” light above the line signals the severity of the problem.
• Each day the York facility produces up to 600 heavy-duty
factory-custom motorcycles. Bikes are assembled with
different engine displacements, multiple wheel options,
colors, and accessories. The result is a huge number of
variations in the motorcycles available, which allows
customers to individualize their purchase. (See www.Harley-
Davidson.com for an example of modular customization.)
• The Harley-Davidson production system works because
high-quality modules are brought together on a tightly
Example: Flowcharts
▶Paper-making process
Example: Flowcharts
▶ Bread-making process
From Product Attribute to Process
Competency
• Strategies for Competitive Advantage

1. Product cost – cheap/affordable

2. Response – more responsive
3. Differentiation – better, or at least different
4. Product Quality – inherent characteristics of an object
fulfils the requirement

The four major strategies for competitive advantage are

differentiation, cost leadership, response and product quality . While it
may be possible to compete on all four at once, most firms focus on
one of these major strategies
Four Dimensions of Process Competency

Product Attribute Process Competency

(External) (Internal)
Price (cost for customer) Cost
Response time Flow time
Variety Flexibility
Quality Quality
 Competitive Priority
Examples

Criteria Definition Processes considerations Example

Quality

1. Top quality Delivering an To deliver top quality, it may Rolex is known for creating
outstanding service require superior product precision timepieces.
or product features, close tolerances,
and greater durability from a
manufacturing process.

2. Consistent Producing products Processes must be designed McDonald’s standardizes

quality or services that and monitored to reduce work methods, staff
meet design errors, prevent defects, and training processes, and
specifications on a similar outcomes over time, procurement of raw
consistent basis regardless of the level of materials to achieve the
quality same consistent product
and process quality from
one store to next. 2-10
 Competitive Priority Examples
Criteria Definition Processes considerations Example
Time
1. Delivery Quickly filling a Designing processes to reduce Netflix engineered its customers
speed customer’s order lead time through keeping backup relationship, order fulfillment, and
capacity cushions, storing supplier relationship processes to
inventory, and using premier create an integrated web-based
transportations options system that allows its customers to
watch multiple episodes of a TV
program or movies in rapid
succession.
2. On-time Meeting delivery- Along with processes that reduce FedEx or DHL uses expertise in
delivery time promises lead time, planning processes logistics and warehousing to make
(forecasting, scheduling, capacity), deliveries in India
are used to increase percent of
customers orders shipped when
promised (95% is the goal)

Flexibility
Variety Handling a wide Processes for variety―capable of Amazon offers more than 25 million
assortment of large volumes stock keeping units to its customers
services or products in India. 2-11
Process Selection
Two key questions in process selection:
1. How much variety will the process need to be able to handle?
2. How much volume will the process need to be able to handle?
 Four Processes Strategy
• A process strategy is an organization’s
Process strategy approach to transforming resources into
An organization’s approach
to transforming resources
into goods and services.
goods and services.
• The objective is to create a process that
can produce offerings that meet customer
requirements within cost and other
managerial constraints.
• Virtually every good or service is made by using some
variation of one of four process strategies:

process
focus

product
focus

mass
repetitive
customiz-
focus
ation
 Process Focus
• The vast majority of global production is
devoted to making low-volume, high-variety
products in places called “job shops.” Such
facilities are organized around specific activities
or processes.
• In a factory, these processes might be
departments devoted to welding, grinding, and
painting. In an office, the processes might be
Process focus
accounts payable, sales, and payroll.
A production facility organized
around processes to facilitate low-
volume, high-variety production.
• In a restaurant, they might be bar, grill,
and bakery. Such facilities are process
focused on terms of equipment, layout,
and supervision.
Advantage
• They provide a high degree of product
flexibility as products move between the
specialized processes. Each process is
designed to perform a variety of activities
and handle frequent changes.
Consequently, they are also called
Repetitive Focus
•Repetitive processes, as we saw in the Global Company
Profile on Harley-Davidson, use modules. Modules are
parts or components previously prepared, often in a
product-focused (continuous) process.
•The repetitive process is the classic assembly line.
Widely used in the assembly of virtually all automobiles
and household appliances, it has more structure and
consequently less flexibility than a process-focused
Modules

facility. Parts or components of

a product previously
prepared, often in a
continuous process.
Repetitive process
A product-oriented
production process
that uses modules.
Fast-food firms are another example of a repetitive
process using modules.
This type of production allows more customizing
than a product-focused facility; modules (for
example, meat, cheese, sauce, tomatoes, onions)
are assembled to get a quasi-custom product, a
cheeseburger.
In this manner, the firm obtains both the economic
advantages of the product-focused model (where
many of the modules are prepared) and the custom
advantage of the low-volume, high-variety model.
Product Focus

•High-volume, low-variety processes are product focused.

The facilities are organized around products. They are
also called continuous processes because they have very
long, continuous production runs. Products such as glass,
paper, tin sheets, lightbulbs, beer, and potato chips are
made via a continuous process.
•Some products, such as lightbulbs, are discrete; others,
such as rolls of paper, are made in a continuous flow.
Product focus
A facility organized around
products; a product-
oriented, high-volume, low-
variety process.
•Frito-Lay's family of products is also produced in a
product-focused facility. At Frito-Lay, corn, potatoes,
water, and seasoning are the relatively few inputs, but
outputs (like Cheetos, Ruffles, Tostitos, and Fritos) vary in
seasoning and packaging within the product family.
•A product-focused facility produces high volume and
low variety. The specialized nature of the facility requires
high fixed cost, but low variable costs reward high facility
utilization.
Mass Customization
• A peek at the rich variety of goods and services that operations managers are
called on to supply is shown in Table.

Mass customization
Rapid, low-cost production
that caters to constantly
changing unique customer
desires.
• Mass customization is the rapid, low-cost
production of goods and services that fulfill
increasingly unique customer desires.
• But mass customization is not just about
variety; it is about making precisely what
the customer wants when the customer
wants it economically.
• Dell Computer has demonstrated
that the payoff for mass
customization can be substantial.
More traditional manufacturers
include Toyota, which recently
announced delivery of custom-
ordered cars in 5 days. Similarly,
electronic controls allow designers in
the textile industry to rapidly revamp
their lines and respond to changes.
• The service industry is also moving toward mass
customization. For instance, not very many years
ago, most people had the same telephone
service. Now, not only is the phone service full of
options, from caller ID to voice mail, but
contemporary phones are hardly phones. They
may also be part camera, computer, game
player, GPS, and Web browser.
 Making Mass Customization Work
Mass customization suggests a high-volume system in which products
are built-to-order. Build-to-order (BTO) means producing to customer Build-to-order (BTO)
Produce to customer
order rather than to a
orders, not forecasts. But high-volume build-to-order is difficult. Some forecast.

major challenges are:

• Product design must be imaginative. Successful build-to-order
designs include a limited product line and modules. Ping Inc., a
premier golf club manufacturer, uses different combinations of club Postponement
heads, grips, shafts, and angles to make 20,000 variations of its golf The delay of any modifications
or customization to a product
as long as possible in the
clubs. production process.

• Process design must be flexible and able to accommodate changes in

both design and technology. For instance, postponement allows for
customization late in the production process. Toyota installs unique
interior modules very late in production for its popular Scion, a
process also typical with customized vans.
• Inventory management requires tight control. To be successful with
build-to-order, a firm must avoid being stuck with unpopular or
obsolete components. With virtually no raw material, Dell puts custom
computers together in less than a day.
• Tight schedules that track orders and material from design through
delivery are another requirement of mass customization. Align
Technology, a well-known name in orthodontics, figured out how to
achieve competitive advantage by delivering custom-made clear plastic
aligners within 3 weeks of the first visit to the dentist’s office (see the
OM in Action box “Mass Customization for Straight Teeth”).
• Responsive partners in the supply chain can yield effective
collaboration. Forecasting, inventory management, and ordering for
JCPenney shirts are all handled for the retailer by its supplier in Hong
Kong.
Align Technology of Santa Clara, California, wants to straighten The clear aligners take the
your teeth with a clear plastic removable aligner. The place of the traditional “wire
company is a mass customizer for orthodontic treatments. and brackets.” Align calls the
Each patient is very custom, requiring a truly unique product; product “complex to make,
no two patients are alike. Based on dental impressions, X-rays, easy to use.” With good OM,
and photos taken at the dentist’s office and sent to Align mass customization works,
headquarters, the firm builds a precise 3-D computer model even for a very complex, very
and file of the patient’s mouth. This digitized file is then sent individualized product, such as
to Costa Rica, where technicians develop a comprehensive teeth aligners.
treatment plan, which is then returned to the dentist for
approval. After approval, data from the virtual models and
treatment plan are used to program 3-D printers to form
molds. The molds are then shipped to Juarez, Mexico, where a
series of customized teeth aligners—usually about 19 pairs— Sources: BusinessWeek (April 30, 2012); Laura Rock Kopezak and M. Eric
are made. The time required for this process: about 3 weeks Johnson, “Aligning the Supply Chain,” Case #6-0024, Dartmouth College,
from start to finish. 2006; and www.invisalign.com.
Mass customization begins with the order. And at ability to order immediately, scan
restaurants from California to Boston, the order now starts coupons, and swipe credit cards at the
with an iPad. Stacked Restaurants lets customers choose table. The instantaneous placement of
ingredients for their sandwiches using an iPad on the table. the order to the kitchen is a significant
Diners also get a great photo of the menu item (which advantage for those restaurants
stimulates sales), a list of ingredients and nutritional pursuing a response strategy.
information (a plus for those with allergies or watching Using iPads means developing a
their diet), and an opportunity to build their own meal new process. iPads are not cheap, but
(mass customization). they are accurate and
Some restaurants, in addition to having the enticing fast, with lots of options. Restaurants using the new process
photo of the meal, find that they can add a description find customer retention, frequency of visits, and average check
and photo of just what a medium-rare steak looks like. size all increasing.
They can further enrich the dining experience by adding a
“recipe” tab or “history" tab with descriptions of the
item’s origins and tradition. Steakhouses, a chain in San
Francisco, Atlanta, and Chicago, finds the tabs great for its
lengthy wine lists. Others program the system to
remember the guest’s meal preferences. And some Sources: New York Times (June 21, 2014) and USA Today (February 16, 2011) and
customers love the (July 25, 2012).