PRODUCTION MANAGENET PART 1 ENTERPRISE - INTRODUCTION David CHEN LAPS-IMS, Université Bordeaux 1
1. ECONOMIC CONTEXT
EVOLUTION OF PRODUCTION ACTIVITES Activities (France)
(Three principal sectors of activities)
Secondary sector: Production of transformation of raw material Primary sector : production of raw materials (agriculture, fishing, coal,…)
Tertiary sector: production of services (bank, insurance, consultancy …)
Time 1900
1960
1980
2005
EVOLUTION OF PRODUT Range of products
Personalized products
Life cycle
-Wish to sell more products -Technology innovations -Fashions
Standard products
1900
year
- Increasing product variety - Mass production => Small batch production
1990
EVOLUTION OF MARKET Competition
JIT (Just In Time)
* Competition increased Offer > Demand * Produce what is already sold
Forecasting, planning
* Competition started Offer = Demand * Produce what will be sold
Inventory management
Offer < Demand
* No competition * Produce then sell
Time 1900
1960
1980
2000
2. ENTERPRISE
ENTERPRISE DEFINITION An enterprise is a grouping of individuals, structured and organized around technical and financial means with the goal of satisfying needs on a market. Raw materials
Products
Enterprise Finance
Finance
Note : there are other types of flow: personnel, information, communication,…
Humans
Techniques
Finances
Resources Flow product
Goods & services
Receipts and expenses
Flow finance
Enterprise
Extended vs. Virtual Enterprises An Extended Enterprise is a loosely coupled, selforganizing network of firms that combine their economic output to provide products and services offerings to the market.
Extended enterprise Supplier
A Virtual Enterprise is a temporary alliance of enterprises that come together to share skills or core competencies and resources in order to better respond to business opportunities
Enterprise
Customer
enterprise A enterprise B
enterprise C
Virtual enterprise
ENTERPRISE - INTRODUCTION
8
The new reactive enterprise
COMPANY OWNED
COMPANY OWNED IN THE PAST A COMPANY OW NED ALL OF ITS MANUFACTURING
PROCESS COMPANY
COMPANY OWNED STRATEGIC RELATIONSHIP
COMPANY OWNED IN THE FUTURE A COMPANY HAS MANY MORE MANUFACTURING OPTIONS
RECENTLY BOUGHT
PRODUCTION Structure of Production means
ENTERPRISE
Can contain 1 or more
SITE Can contain 1 or more
PRODUCTION UNIT Can contain 1 or more
MANUFACTURING CELL Can contain 1 or more
WORK STATION
Can contain 1 or more
SHOP
Can contain 1 or more
CELL
Can contain 1 or more
PRODUCTION LINE Can contain 1 or more
CELL
ENTREPRISE OBJECTIVE To answer the demand of market, the production must satisfy the three following criteria : COST
DELAY
QUALITY
Optimization of these three criteria makes the enterprise competitive
ENTERPRISE THE COSTS PRIME COST PRICE OF SALE BENEFIT
In the past, the price of sale is fixed by the company: PRICE OF SALE = CALCULATE
PRIME COST + TAKE AS IS
BENEFIT DEFINE
Today, the price of sale is fixed by the market : PRIME COST = OBJECTIVE
PRICE OF SALE IMPOSED
BENEFIT NECESSARY
ENTERPRISE DELAY Commercial delay Production delay Production delay > Commercial delay => Production to forecast => Stock needed Commercial delay Production delay Production delay < Commercial delay => Production to order => No stock needed
PRODUCTION S U P P L I E R S
Stock raw materials
RM
FP
SA production
purchase
assembly
manufacture
purchase + manf. + ass. on forecast purch. + manf. on forecast CD2 CD3 CD4
Stock finished products
Stock sub assemblies
delivery
CD1 delivery to order
ass. + delivery to order
manf. + ass. + delivery to order
purch. + manf. + ass. + delivery to order CD: Commercial Delay
C L I E N T
ENTERPRISE The function in an enterprise
Sales and Marketing
Research and development
Personnel
General Management Production
Finances and accounting Purchasing
Environment
client
3. PRODUCTION
PRODUCTION DEFINITION
The Production consists of a transformation of resources (human or materials) with the aim of the creation of goods or services : • The production of a good is made by a succession of operations consuming resources and transforming the characteristics of material. • The production of a service is made by a succession of operations consuming resources without necessarily the transformation of material.
PRODUCTION • Continue Production - Fluid and automatic transformation process without intermediate stocking - Heavy investments, complex technologies, rate of uses of equipment high => Ex.: Refinery, Steelworks, Electricity, automobile assembly line,..
• Discontinue Production - Called also 'discrete process', divided up to allow the rework of semifinished products - Production by batches with intermediate stocking => Ex.: Mechanical, electronics,…
PRODUCTION Relation between the cost and volume of production Cost of production Discontinue Production
Continue Production
Volume of production
DISCRETE PRODUCTION • Mass production Specialized and (automated) lines per family of products (relatively standardized) => Ex.: Automobile, household appliances,… • Small and medium batch Share of equipments, big number of batches in progress, variety of products => Machine tools, Equipments (Ex. Landing gear ) • One-of-a-kind production Realization of unique and complex products => Nuclear power stations, Space shuttles ,…
DISCRETE PRODUCTION Mass production Increasing scale of production
Batch production
One-of-a-kind production Increasing product variety
Characterization of discrete production types Masse Production
Batch Production
One-of-a-kind Production
Production volumes
High
Medium
Low
Labor skills
Low
Medium
High
Specialized equipment and tooling
High
Medium
Low
DISCRETE PRODUCTION LAUNCHING
Repetitive
No repetitive
TYPES
One-of-a-kind
Small and medium batch Mass production
Motor of missile Pumps for nuclear technology
Machine and tools
Public works Mould for press Sub-contracting (mechanical, electronic) Test batches
Household appliances Automobile
Newspapers Products of fashion
SMALL VERSUS LARGE BATCHE JIT produces same amount in same time if setup times are lowered
Small Lot Approach A
A
B
B
B
C
A
A
B
B
B
C
C
C
Time Small lots also increase flexibility to meet customer demands
Large-Lot Approach A
A
A
A
B
B
B
Time
B
B
B
PRODUCTION STRUCTURE DU PRODUIT MATIERE PREMIERE
acheter Sous-traiter
PIECE
SOUS ENSEMBLE
fabriquer
PIECE
SOUS ENSEMBLE
PRODUIT FINI
Exemple d’illustration
PIECE
PRODUCTION Production transformation process
CONVERGING
- Few finished products - A lot of components - Ex: electric circuits, mechanical products
DIVERGENT
LINEAR
- Few raw - Few finished products materials/components - Few raw materials - Big variety of finished - ex: industry of packing products - ex: milk industry , meat products
PRODUCTION FLOW SHOP - L’ordre de passage des produits sur les machines est imposé. Tous les produits suivent le même chemin. JOB SHOP - L’ordre de passage des produits sur les machines est imposé. Mais les produits ne suivent pas le même chemin. OPEN SHOP - Aucun ordre n’est imposé. SHOP: Terme générique : ligne de production, atelier, cellule
4. PRODUCTION MANAGEMENT
PRODUCTION MANAGEMENT DEFINITION
The production management has as objective to pilot and to organize the flow from suppliers to the customers
Customer orders
Objectives of top management
Production management system Orders
Raw material
Physical system
Follow-up information
Finished products
PRODUCTION The Production Management is a set of methods aiming at producing:
=> in accordance with technical data issued by the R&D department, => in the delay fixed by the commercial department, => at the level of quality required by the quality control service, => at the cost which is acceptable by the accounting department. H. TRON
PUSH VS. PULL
Programme
PULLED FLOW
Manufacturing
Manufacturing
PUSHED FLOW
Demand
PUSH VS. PULL MRP – PUSHED FLOW
Prod. Plan MO Supplier
PO Machine 1
Machine 2
Machine 3
Clients
KANBAN – PULLED FLOW Order
Supplier
kanban
Machine 1
kanban
Machine 2
Order
Machine 3
Clients
PRODUCTION MANAGEMENT Manufacturing to order
PRODUCTION SCHEDULE
suppliers Purchasing
no
orders
client
Parts available in stock? Delivery yes
MANUFACTURE
PRODUCTION MANAGEMENT Manufacturing to forecasts
PRODUCTION SCHEDULE
suppliers
no
Sale forecasts
market
Parts available in stock? yes MANUFACTURE
STOCK
PRODUCTION MANAGEMENT Manufacturing to stock
no
Stock point reached? yes MANUFACTURE OR PURCHASE
STOCK
PRODUCTION MANAGEMENT What is production management and control ? Inventory Pur- Requirement management chase
S U P P L I E R S
M A T E R I A L STOCK P A R T S
Planning and Control
PRODUCTION TRANSFORMATION IN-PROGRESS
Inventory management
STOCK FINISHED PRODUCT
Commercial
D E L I V E R Y
C L I E N T S
Questions?
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