Operation Process

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Unit 2
Operations Processes
Dr. Prashant B. Kalaskar

Syllabus
2.1: Process Characteristics in Operations: Volume, Variety,
Flows, Types of Processes & Operations System,
continuous flow & intermittent flow system.
2.2: Process Product Matrix: Job production, batch
production, Assembly line & Continuous flow process &
production layout
2.3: Service System Design Matrix: Design of Service
system, Service Blue print
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Process Design
What is Process Design..?
Why Process Design..?
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Process Design
- The objective of organization is to provide products &
services, to satisfy customers & to create value for them.
- A product & service design is based on the customer
feedback and requirement of the market.
Ex: Plane Salted Potato Chips to Spicy Chips or like Kurkure
- Process design is where the product is broken down into
parts, which further can be helpful in the actual
manufacturing process.
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Process Design
- Designing means to conceive the looks, arrangements
and workings of something before it is created.
- It is based on the objectives of design like volume &
variety characteristics etc.
- Process design can be the design of new facilities or it
can be the modification or expansion of existing facilities.
- The design starts at a conceptual level and ultimately
ends in the form of fabrication and construction plans.
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Operations Management
• Operation Management involves two major activities.
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Operations Management
Process Design Process Control
1) Product Development
2) Choice of Technology
3) Manufacturing Process
4) Output Capacity
5) Quality & Cost of Product
1) Effective & Efficient
Utilization of Available
resources
Supported Tasks: Demand Forecasting, Production Planning, Scheduling,
QC, Maintenance Management & SCM

Operation Process
• Operation is a process designed to convert input in to a
valuable product or Service (Transformation).
• Designing a Process may provide competitive advantage
to the firms.
• The Raw Materials, Information, Ideas, capital etc.
becomes the inputs in a Manufacturing Process to result
in desire output i.e. a Product or Service
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Operation Process
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Operation Process
• Improvisation in the process designs adds value & helps
companies to perform better
• Well designed Operation process allows companies to;
- Lower cost of Manufacturing
- Efficiency in Operations
- High Quality Products to deliver higher value
- Reduction in Process time
- Reduction in Lead Time for the Customers
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Selection of Process may result in
Competitive Advantage..
1) Low-cost operations
2) High performance design
3) Consistent quality
4) Fast delivery time
5) On-time delivery
6) Development speed
7) Product customization
8) Volume flexibility
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Process Strategy
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Variety
Low
Medium
High
Volume
Low Medium High
Project
Manufacturing
Cell
Work-center
Assembly
Line
Continuous
Process

Product Process matrix
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Job Shop Production
Batch Production
Mass Production
Continuous
Production
Volume
Variety
Low
Medium
High
Low Medium High

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Process Focus (Job Shop)
- Low volume, high variety, “do it all”
- High amount of flexibility
- Each job is different
- Relatively high cost per unit
- Considerations in Process Selection/Evaluation
- Unit cost decreases as standardization increases, & production
increases.
- Flexibility decreases as volume, standardization increase

Determinants of Process Characteristics
1) Volume:
2) Variety:
3) Flow:
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1) Volume:
- “It is he average quantity of products produced in any
manufacturing system”
- High Volume Production system manufacture large
number of products in a day (Mass Production)
Ex: An auto-parts manufacturer might create thousands of units
exactly the same parts to send to automobile factories.
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1) Volume:
- High Volume manufacturers uses variety of processes to
manufacture high output of materials
- Ex: Assembly lines are another high volume manufacturing
process where goods are put together piece-by-piece by human
workers, machines or a combination of the two.
- Each worker or machine in the assembly performs a specific task,
then passes a unit on to another worker or machine until all the
tasks necessary to create a final product are performed.
- Advantages: High Sales, Cost Efficiency, Faster Production
- Disadvantage: High Space Cost, No Customization of product
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1) Volume:
- Low Volume: Production system manufacture small
number of products in a day
- Small scale business with low demand choose this
method of Manufacturing
Advantages: Space Cost is Low, Low level of Inventory,
Customization of products is possible
Disadvantages: Low volume of Sales, Slower Production Cost of
production high, Less profits
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2) Variety: “Number of Alternative products or Variants
that a company produces”
- A Watch making company Titan is manufacturing
40000+ variants of watches
- TELCO manufactures various varieties of Tata Indica cars
- More the varieties, more will be alternative production
resources & Materials, skilled workers & increases no. of
stages in production
- Ex: A Travel agent is booking Bus, Rail & Air Tickets
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3) Flow: “The materials under the transformation process
to get converted in product has different flows”
- The flow indicates the various stages through which the
Raw Materials (Input) is passing through to get
converted into Finished Product.
- Knowledge flow is also an vital aspect of Production
Process
- More the Volume, Less the Varieties, both influences
the flow
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5 Key Decisions in Process Management
1) Process Choice
2) Vertical Integration
3) Resource Flexibility
4) Customer Involvement
5) Capital Intensity
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1) Process Choice: It is most critical step to select a
process choice in Process Management.
- Manufacturing & service operations can be characterized/
Classified as one of the following:
1) Project
2) Job Shop
3) Batch Flow
4) Line Flow
5) Continuous Flow
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Process Choice
1) Project Process: Examples of a project process are
building a shopping center, running a political
campaign, developing a new technology or product.
- The project process requires a high degree of job
customization
- The sequence of operations and the process involved in
each one are unique to each project, though they may
look similar
- It involves many interrelated tasks must be completed,
requiring a close coordination.
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Process Choice
2) Job Shop Process: Examples are custom metal processing
shop, hospital emergency rooms etc.
- Flexibility needed to produce a variety of products or
services with high degree of customization & low Volume
- Each new order is handled as a single unit as a job
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3) Batch Flow Process: Examples of a batch flow process
are scheduling an air travel, manufacturing garments,
furniture manufacturing etc.
- Volumes are higher because the same or similar products or
services are provided repeatedly
- A narrower range of products or services is provided.
- Some of the components for the final product or service
may be produced in advance.
- Larger quantities per batch, Repetition of Same Products
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Process Choice
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4) Line Flow Process: Examples of Products produced by
line process include automobiles, appliances, personal
computers, toys and fast-food restaurants .
- A line flow process lies between the batch and
continuous processes
- High Volume Production, Standardized Products, hence
resources can be well organized
- Materials move linearly from one operation to the next
according to a fixed sequence
- Repetition of same process with little or no variability
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Process Choice
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4) Line Flow Process: line flow processes often follow a
make-to-stock strategy, with standard products held in
inventory so that they are ready when a customer places
an order.
- Sometimes the Line Flow process is also called as Mass
Production
- The pacing of production may be either machine-paced
or worker-paced.
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Process Choice
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5) Continuous Flow Process: Examples are petroleum
refineries, chemical plants, and plants making beer, steel,
and processed food items.
- Such firms are also referred to as the process industry
- A continuous process is the extreme end of high-volume,
standardized production with rigid line flows
- The process often is capital intensive and operated round
the clock to maximize utilization and to avoid expensive
shutdowns are start-ups.
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Process Choice
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Vertical Integration
• Every Manufacturing organization performs various
processes to provide value to their customers (Value Chain).
• Some of these services the Organization can Outsource
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Inbound Logistics Operations Outbound Logistics Sales & Mktg. After Sales Services
Supplier of Raw Materials

• More the vertical integration, less will be outsourcing.
• These decisions are sometimes called make-or-buy
decisions, with
- Make decision meaning more integration &
- A buy decision meaning more outsourcing.
- Backward & Forward Integration are two types
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• Advantages of Vertical Integration:
1) Expansion in domestic as well international Markets
2) Cost savings due to resource, skills & volume sharing
3) Ensured & better quality & improved delivery time
4) Better utilization of Core Competencies of both parties
5) By integrating with upstream firms, company can
provide better quality products and services to their
customers.
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Resource Flexibility
• For a better competitive advantage, a company needs to
have resource flexibility like employees, facilities, and
equipment
• Employee flexibility is new product (design)
customization using available facilities (resources)
• Another flexibility is capacity flexibility, which is used to
increase or decrease output without affecting
profitability
Ex: A Fast Food Restaurant remaining open for 24 hours in a day
from 12 hours working a day
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• Flexible Work Force: An Operation Manager should give
on & off the job training to their workforce to make them
flexible at point of work station.
• Worker flexibility can be one of the best ways to achieve
reliable customer service and improve capacity holdups.
• Work Flexibility is required when Volume is flexible
Ex: Bank operations have rotational jobs to their
employees so as to manage work force in the peak hours
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• Flexible Equipment: For products with high degree of
Customization & Low volume of output, one should use
Inexpensive & Flexible Equipments.
• Specialized, higher-cost equipment is the best choice
when volumes are high and customization is low.
• Flexible equipments allows to reduce fixed cost
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Customer Involvement
• The fourth significant process decision is the extent to
which customers interact with the process.
• The amount of customer involvement may range from
self-service to customization of product.
• Self Service: Toys, bicycles companies preferred to let the
customer perform the final assembly because production,
shipping, and inventory costs frequently are lower
• Product Customization: Custom-designed and built homes are
the examples where the customers are involved in product
customization
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Capital Intensity
• For either the design of a new process or the redesign of
an existing one, an operations manager must determine
the amount of capital intensity required.
• Capital intensity is the mix of equipment and human skills
in the process; the greater the relative cost of
equipment, the greater is the capital intensity.
• With increase in Production output manager can decide
to go little to semi to full automation of equipments.
• Increasing output lowers the capital intensity
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Types of Processes & Operations System
• The process & Operation system is classified based on
the product flow.
• Product flow is based on capacity availability & utilization
• Two types of Operation Systems are
1) Continuous Flow System
a) Process Industry
b) Mass Production
2) Intermittent Flow System
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Continuous Flow System
• As the name indicates, the production system flows
continuously until the final product is finished.
• All the activities are streamlined & well organized
• The raw materials passes through predefined stages to
get converted into final product
• The process involved are sequential, hence resources
must be organized in systematic manner
• Ex: Manufacturing of Petrochemical, Pharmaceutical,
Cement, Paper Manufacturing, Electricity Generation etc.
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• All the raw materials required to manufacture the final
product are fed in the system & the process begins
• Once the process starts it can not be stopped until final
product stage is finished (Unstoppable/Continuous flow of System)
• Standardized products, Large Volume of Production, the
system can be configured in orderly manner for a
continuous Production System
• Discrete Manufacturing System is where different components are manufactured
separately & then they are combined (assembled) into final product
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Continuous Flow System in Process Industry
• Process industry may involve various stages & may also
involve chemical reactions to produce final product.
• In continuous flow, sometime the process can be
stopped in between to produce byproducts so as to
outsource it to other company to produce final product
Ex: Continuous flow system manufacturing in Paper Industry
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Continuous Flow System in Paper Mfg. Industry
• The paper manufacturing is divided in 3 stages
1) Preparatory Stage
2) Pulp Making Stage
3) Paper making Stage
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Logs & Chips of
Wood Stored
Crushing of Logs &
Chips
Processing of the
Wood
Cleaning & Bleaching
Drying of the wood
Pulp
Refining of the wood
Pulp
Cutting Final Packing
Stretching, Rolling
papers in Presses
Preparatory Stage
Pulp Making Stage
Paper Making Stage
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Continuous Flow System in Process Industry
• Requirements:
1) Balancing of Capacity at all stages of Processing to
maintain even flow of raw materials & finished products
2) Under utilization of capacity should be avoided
3) Productivity (output) is completely dependent on flow
rate of materials
4) Initial capital requirement is high, incremental investment
in later stages is not possible
5) High productivity allows to reduce production cost
6) Good Maintenance facility to avoid frequent stoppage
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• Mass production is characterized as High Volume & Low
Variety
• The resources & equipments can be sequentially
organized for each variant to be manufactured, which
allows a streamlined flow (product line structure)
• The product line structure is also called as Product Layout
Ex: Two wheeler Mfg. unit or Electrical Products like
switches, disposable syringes manufacturing etc.
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Continuous Flow System in Mass Production
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Product A Product B Product C
Pre Manufacturing Activities
Machining Machining Machining
Fabrication Fabrication Fabrication
Assembly Assembly Assembly
Testing Testing Testing
FlowLine
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• Requirement:
1) Capacity balancing at all the levels is important to
maximize productivity
2) Line Stoppage or Breakdown may detriment
Productivity
3) Better maintenance management system is must to
avoid production held ups
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Example

Intermittent Flow System
• Intermittent means something that starts (initiates) and
stops (halts) at irregular (unfixed) intervals (time gaps).
• These goods are produced on a small scale.
• Goods are produced based on customer's orders.
• Products produced of large varieties & of different sizes.
• The design of these products goes on changing.
• The flow of production is intermittent (not continuous).
• Therefore, this system is very flexible.
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•Examples:
•The goldsmith makes goods (Gold Ornaments) on a small-scale basis
as per his customer's requirements. Here, ornaments are not done on
a continuous basis.
• The work of a tailor is also based on the number of orders he gets
from his customers. The clothes are stitched for every customer
independently by the tailor as per one's measurement and size.

• Increasing Competition & Changing Customer Demand
forcing companies to manufacture variety of Products
• Ex: A car manufacturing company manufactures many
variants of Cars (MS WagonR- Lxi, Vxi, Zxi, Vdi, Zdi, Auto)
• Available resource can not be dedicated completely to
each variant
• Resources has to be shared for variants for cost
management.
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• Every variant will have different processing & sequence
• Intermittent flow is also called as Mid Volume or Mid
Variety flow system
• Each variant’s flow system may result in complex flows of
activities or Product Layout
• Such Complexities in flow can be managed by Batch
manufacturing
• One batch One variant, Other Batch, Other Variant
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• Ex: In Food Products manufacturing industry, ingredients
like Preservatives & Additives can be used in different
products.
• When one batch is over, the plant is stopped, made some
modifications in process & changes in raw materials to
produce other variants (In Pharma industry medicines are
manufactured by Batch production method)
• Requirement: Balancing the Capacity Flow not as vigorously
as in case of Continuous Flow System
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Process Flow Diagram
• Every Process boundaries has two points
1) Entry Point of Inputs &
2) Exit Point of Output
• Process Flow Diagram allows to understand the stage of
process using various graphic element
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Inverted Triangle CirclesRectangles Arrows

• Rectangle: It represents a Task
• Arrows: It represents the direction of flow of Materials or
Flow of Information
• Inverted Triangle: It represents storage (inventory). [For
the storage of inventory, bins are used. The inventory can of
Materials, Semi Processed or Finished Products inventory]
• Circle: Represents Storage of Information
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Process Flow Diagram

Some Important Terminologies
• Assemble to Product (ATO): A Product is Made from the
assembling of Stock materials (subassemblies)
• Bottleneck: Something that limits/reduces output/capacity
• Buffering: A area where stages are operating separately
other than routine assembly line (Extra Line to meet Target)
• Cycle Time: It is the average elapsed time between starting
a job & finishing a job
• Engineer to Order: Newly designed product which have not
been previously Engineered.
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• Flow Time: It is the average time that a unit requires to flow
through the process from the start to finishing point
• Lead Time: Time interval between the start & end point of
activity (response time). It can be the time between placing
the order & receipt of order.
• Make to Order (MTO): Previously engineered products
making only after receipt of order
• Make to Stock (MTS): Making of products & stocking it,
until order from the customer arrives
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• Manufacturing Cell: A self sufficient unit, where final
product is manufactured using all family parts
• Process Capacity: Maximum output per unit time
• Multiple Stage Process: Product is manufactured at multiple
stage. Semi products are manufactured at all the stages
which later is combined with next stage Process.
• Throughput Rate (Flow Rate): The average rate at which a
product passes from one assembly point to the other
assembly point
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Layout
Layout planning is determining the best physical
arrangement of resources within a facility
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Machines or Equipments
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Lathe: a machine for shaping wood, metal
Drill: a machine produce (a hole) in something
Grinder: a machine used
for grinding something Punch Press

Why is layout planning important?
• Eliminates unnecessary space costs & materials handling
• Reduces work-in-process inventory (Completes Process)
• Produces goods and services faster
• Reduces distances that workers may travel in the
workplace
• Improves communication and morale
• Improves Overall quality of operations
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Types of Layouts
• Process layouts: Group similar resources together
• Product layouts: Designed to produce a specific product, or
a small number of products efficiently (Different Resources)
• Hybrid layouts: Combine aspects of both process and
product layouts (Example: cellular layout)
• Fixed-Position layouts: Product is too large to move
Examples: building construction, shipyard, Airpane
Resources must be brought to where they are needed
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Process and Product Layouts
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Process Layouts (Functional Layout)
• Based on the process requirement for the Product, the
resources (machines) are arranged in that sequence.
Product A
Product B
Product C
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L L
L L
M M
D D
G G
L: Lathes, M: Milling, G: Grinding, D: Drilling

Process Layouts (Functional Layout)
• In process layout, the single component is required to
move through the machines in the planned order.
• More the number of materials manufactured, there will
be a large number of criss-crossing on the shop floor.
• Material Handling increases, may affect production
control
• Each department has separate functional group i.e. there
will be Drilling in Department, Lathes in Lathe
Department, Grinders in Grinding Department.
• Examples Warehouse, Quality Control, Gym etc.
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Product Layout
• The order in which resources placed are as per the
visitation sequence as dictated by the product.
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L
L
MD G
M D G
L L D M Product C
Product B
Product A

Product Layout
• The resources arranged are as dedicated to each product
• Smooth component flow in each job shop
• Fixed path material handling ensures minimal handling of
materials
• Production control will be effective & simpler
• Quicker dispatch of finished product from final point
• Useful to both Manufacturing as well service sector
Examples: Bank, Restaurant,
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L MD G Product A

Choice of Layout
• When Volume of Production is High
(Mass Production) then Product Layout is
Feasible.
• When Volume of Production is Low
then Process Layout is Feasible
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Example of Product Layout (Bank)
Bank A- Private Sector Bank B- Public Sector
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Layout of Bank Sector
• Resources in bank are organized based on their
functions (Banking Operations)
• A bank will have, a Saving Account Clerk, Current
Account Clerk, a Cashier, a Bank Manager etc.
• Now a days the layout in Bank are either customer
focused or product focused.
• Layout is organized based on customer segments to be
catered.
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Layout of Bank A- Private Sector
• In Bank-A Customer enters in a waiting area first
• Customer Relationship Manager attends that customer
to understand his/her service requirement (May I Help U)
• The customer is directed based on product/service
requirement
• Private Sector banks follow Product Layout
• Advantages: Standardized process, Better control, faster
service
• Disadvantages: Duplication of resources may increase
cost, Less flexibility due to dedicated resources
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Layout of Bank B- Public Sector
• In Bank-B Customer enters in a Bank & depending upon
type of service required, customer will divert himself to
different sections.
• Public Sector banks follow Process Layout
• Advantages: Sharing of Specialized & Costlier Resources,
Flexibility is more,
• Disadvantages: Excess Material Handling, Poorer
Operational control, Unstandardized Processes, Slower
service
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Group Technology Layout
(Cellular Manufacturing)
• Group Technology is useful for Mid-Volume & Mid-Variety
manufacturing
• A similar kind of product, that requires different process,
the resources are clubbed in a specific manufacturing cell
• Available resources are grouped in part families based on
manufacturing similarities.
• For the process, required machines are grouped & arranged
as layout for the process.
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L M D
D L G
M D L
G D L
L D
M L G
L D
L M
Cell-1 Cell-2
Cell-3 Cell-4

• Example:
1) Reliance Industries in Petrochemical industry wanted to
manufacture High Density Poly Ethylene (HDPE) &
Low Density Poly Ethylene (LDPE).
2) They can use one cell for one type of product
manufacturing
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Fixed Position Layout
This type of layout is useful when….
• The product manufactured in one or few in number
• Product is bulkier in size & weight
• Equipment required to manufacture are also large in size
Examples: Hindustan Aeronautics Ltd. to manufacture
Helicopter,
- ISRO for Satellite
- Aero planes or Ships manufacturing at Shipyards
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Service Blue Printing
• Services are intangible components of value creation for
customers
• Designing a service is called as Service Blue Printing
• Service Blue Printing examines complex interactions
between people and their service experiences.
• “Service blueprint is a picture or map that accurately
portrays the service system so that different people
involved in providing it can understand and deal with it
objectively regardless of their individual point of view.”
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• Service blueprints is used to deliver a better successful
customer experience.
• For products: Looking at a building we can read (give)
a description, but to build the building one needs more
than an image or description, we call it as “the
blueprint”
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• Service blueprints clarify the interactions between;
1) Service Users (Customers)
2) Digital Touch Points, and
3) Service Employees,
4) including the Front Stage activities that impact the
customer directly, and
5) The Back Stage activities that the customer does not see.
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Service
Mapping
Process
Points of Contact
Evidence

Usefulness Service Blueprints
• Service blueprints are useful when..
1) You want to improve your service offering
2) You have lost track of how the service gets produced
3) There are many players in the service industry, to
overcome the competition.
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Service Blue Printing Concept
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3 Essential Requirements of Blue Printing
• The line of interaction: This is the point at which customers
and the service providers interact.
• The line of visibility: Beyond this line, the customer can no
longer see into the service.
• The line of internal interaction: This is where the business
itself stops, and partners step in.
• In between these 3 lines, there are 5 main swim lanes…
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5 main swim lanes
• Physical Evidence: These are the props and places that
are encountered along the customer’s service journey.
• Customer Actions: These are the things the customer
has to do to access the service.
• Without the customer’s actions, there is no service at
all.
• Front stage: All of the activities, people, and physical
evidence that the customer can see while going
through the service journey.
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5 main swim lanes
• Backstage: This is all of the things required to produce
the service that the customer does not see.
• Support Processes: Documented below the line of
interaction, these are the actions that support the
service.
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Example of Hotel meant for Stay
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SUPPORTPROCESS
CONTACTPERSON
(BackStage)(OnStage)
CUSTOMER
Actions
Hotel
Exterior
Parking
Cart for
Bags
Desk
Registration
Papers
Lobby
Key
Elevators
Hallways
Room
Cart for
Bags
Room
Amenities
Bath
Menu Delivery
Tray
Food
Appearance
Food
Bill
Desk
Lobby
Hotel
Exterior
Parking
Arrive
at
Hotel
Give Bags
to
Bell person
Check in
Go to
Room
Receive
Bags
Sleep
Shower
Call
Room
Service
Receive
Food
Eat
Check out
&
Leave
Greet and
Take
Bags
Process
Registration
Deliver
Bags
Deliver
Food
Process
Check Out
Take Bags
to Room
Take
Food
Order
Registration
System
Prepare
Food
Registration
System
PHYSICAL
EVIDENCE

For Any Query……
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+919975770407
Email: pbkalaskar@sinhgad.edu
prashantkalaskar007@gmail.com

Operation Process

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