Types of processes

Conversion (ex. Iron to steel)

Fabrication (ex. Cloth to clothes)

Assembly (ex. Parts to components)

Testing (ex. For quality of products)

The product-process matrix is a tool for
analyzing the relationship between the
product life cycle and the technological
life cycle. It was introduced by Robert
H. Hayes and Steven C. Wheelwright in
two classic management articles
published in Harvard Business Review
in 1979, entitled "Link Manufacturing
Process and Product Life Cycles" and
"The Dynamics of Process-Product Life
Cycles." The authors used this matrix to
examine market-manufacturing
congruence issues and to facilitate the
understanding of the strategic options
available to a company.
The matrix itself consists of two
dimensions, product
structure/product life cycle and
process structure/process life
cycle. The production process
used to manufacture a product
moves through a series of stages,
much like the stages of products
and markets, which begins with a
highly flexible, high-cost process
and progresses toward increasing
standardization, mechanization,
and automation,...
Product-process Matrix: shows
relationship between process
structures and volume requirements.
Process product stru-
stru Low Multiple
Few
Major
High
Volume,
Volume, Products, Products, High
One of a Low Higher Standard-
Kind Volume Volume ization
I. Commercial Flexibility (High)
Job Printer Unit Cost (High)
Shop French Restaurant
These are
the major
II. Heavy stages of
Batch Equipment product and
process life
III. cycles
Automobile
Assembly
Assembly
Line Burger King
IV.
Sugar
Continuous Refinery Flexibility (Low)
Flow Unit Cost (Low)
 A standard approach to
choosing among alternative
processes or equipment
 Model seeks to determine the
point in units produced (and
sold) where we will start
making profit on the process or
equipment
 Model seeks to determine the
point in units produced (and
sold) where total revenue and
total cost are equal
Break-Even Analysis
(Continued)
Break-even Demand=

Purchase cost of process or equipment

Price per unit - Cost per unit
or
Total fixed costs of process or equipment
Unit price to customer - Variable costs per unit

This formula can be used to find any of its

components algebraically if the other
parameters are known
 Example: Suppose you want to purchase
a new computer that will cost $5,000. It
will be used to process written orders
from customers who will pay $25 each for
the service. The cost of labor, electricity
and the form used to place the order is
$5 per customer. How many customers
will we need to serve to permit the total
revenue to break-even with our costs?
 Break-even Demand:
= Total fixed costs of process or
equip.
Unit price to customer – Variable
costs
=5,000/(25-5)
=250 customers
Manufacturing Process
Flow Design

 A process flow design can be

defined as a mapping of the
specific processes that raw
materials, parts, and
subassemblies follow as they move
through a plant

 The most common tools to conduct

a process flow design include
assembly drawings, assembly
charts, and operation and route
Chart
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