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Capacity
is the upper limit or ceiling on the load that an operating unit can handle
Capacity Planning Questions
What kind of capacity is needed?
How much is needed to match demand?
When is it needed?
Design Capacity
Maximum designed service capacity or output rate
Effective Capacity
Design capacity minus allowances such as personal time, equipment maintenance, delays due to scheduling problems, and changing the mix of products
Capacity Cushion
Extra capacity used to offset demand uncertainty
Bottleneck Operation
An operation in a sequence of operations whose capacity is lower than that of the other operations
Economics of Scale
If the output rate is less than the optimal level, increasing the output rate results in decreasing the average unit costs
Diseconomics of Scale
If the output rate is more than the optimal level, increasing the output rate results in increasing average unit costs
Constraint
Something that limits the performance of a process or system in achieving its goal
Break-Even Point (BEP)
The volume of output at which total coat and total revenue are equal
Indifference Point
The quantity that would make two alternatives equivalent
Cash Flow
The difference between cash received from sales and other sources, and cash outflow for labor, materials, overhead and taxes
Present Value
The sum, in current value, of all future cash flows of an investment proposal
Project
a nonrepetitive set of activities directed toward a unique goal within a limited time frame
Process Strategy
Capital Intensity & Process Inflexibility
Process Types
Batch, Job Shop, Repetitive, Continuous, Project
Product or Service Profiling
Linking key product or service requirements to process capabilities
Technology Innovation
The discovery and development of new or improved products, services, or processes for producing or providing them
Technology
The application of scientific discoveries to the development and improvement of products and services and operations processes
Automation
Machinery that has sensing and control devices that enable it to operate automatically
Computer Aided Manufacturing (CAM)
The use of computers to process control
Numerically Controlled Machines (N/C)
Machines that perform operations by following mathematical processing instructions
Flexible Manufacturing System (FMS)
A group of machines designed to handle intermittent processing requirements and produce a variety of similar products
Computer Integrated Manufacturing (CIM)
A system for linking a broad range of manufacturing activities through an integrating computer system
3D Printing
A process that creates a three dimensional object by adding successive layers of material
Product Layout
Layout that uses standardized processing operations to achieve smooth, rapid, high-volume flow
Production Line
Standardized layout arranged according to a fixed sequence of production tasks
Assembly Line
Standardized layout arranged according to a fixed sequence of assembly tasks
Process Layouts
Layouts that can handle varied processing requirements
Intermittent Processing
Non-repetitive processing
Fixed-position layouts
Layout in which the product of project remains stationary, and workers, materials, and equipment are moved as needed
Cellular Production
Layout in which workstations are grouped into a cell that can process items and have similar processing requirements
Group Technology
The grouping into part families of items with similar design or manufacturing characteristics
Line Balancing
The process of assigning tasks to workstations in such a way that workstations have approximately equal time requirements
Cycle time
The maximum time allowed at each workstation to complete its set of tasks on a unit
Precedence Diagram
A diagram that shows elemental tasks and their precedence requirements
Balance Delay
Percentage of idle time of a line
