Product-process mix helps us understand why and how manufacturing organizations change their production operations. With changes in products, market requirements and competition, the equipments, processes, procedures and human resources skills also will change. If process changes are not carried out to accommodate process life cycles, products and processes become incompatible, resulting in competitive disadvantage.
As the product shifts to a different stage, the manufacturing process structure also shifts and new manufacturing priorities emerge. Manufacturing flexibility and quality are the competitive priorities in start up and rapid growth stages. Priorities shift towards dependable delivery and competitive cost in the later stages, viz., maturity and decline.
It may be noted that, production systems tend to evolve as products move through their products life cycles. Two principles, fundamental to the concept of process life cycles:
- Product life cycles and process life cycles are interdependent, and each affects the other. The production processes affect production costs, quality and production volume, which in turn affects the volume of products that can be sold.
Similarly, the volume of products that are sold affects the type of production processes that can be justified.
- Seldom do production processes move continuously along the ideal diagonal.
Business strategies are developed for each major product line, the determination of the volume of demand that is expected for each product and the number of product models necessary to appeal to the market are important factors in choosing the type of process design.
- Invites broader thinking about organizational competence and competitive advantage.
- Enables greater involvement during planning, leading to better alignment among departments and the organization as a whole.
- Provides a pathway to more informed predictions and strategic responses to industry shifts and changes.
- Used to identify business opportunities and guide investment decisions.
- Is static with limited product variety.
- Dimensions are too simple.
- Based on current products.
- Job Shop
Tends to be more reactive, focusing on day-to-day issues. Low volume, one-of-a-kind products are the hallmark.
“If you are an organization that falls into the job shop process, it is more than likely that you produce a variety of goods in relatively low production volumes.” (Holland)
The focus here tends to be on productivity enhancement and economies of scale meet standard practice. Competitive differentiation plays a central role. Organizations likely produce multiple products with a low volume.
“A batch process is one that is capable of producing more goods than a job shop, but the volume per good is still not enough to justify dedicated equipment.” (Holland)
- Assembly Line
At this stage, there are fewer major products but higher volume.
“An assembly line process consists of highly similar goods produced in a repetitive manner. Workstations are set up so that products can pass through them in a sequential order that allows the goods to be produced in the most efficient manner.”
- Continuous Flow
Process and product improvements advance past industry standards and result in a sustainable competitive advantage. At this stage, there’s a high product volume along with high standardization.