PROCESS
POSITIONING
Volume-variety considerations
Presented By:
Group 5
01
TEAM MEMBER
Dương Gia Thuận Trầ n Ngọc Yế n
(120604220025) (120604220033)
Lê Nguyễ n Tườ ng Vy Hoàng Thị Phương Linh
(120604220032) (120604220014)
02
TABLE OF CONTENT
I INTRODUCTION
PROCESS
POSITIONING
VOLUME - VARIETY II
III PROCESS TYPE
CASE STUDY IV
03
What is Process
selection?
Process selection can be defined as the strategic
arrangement of production processes within an
organization to achieve optimal efficiency and
effectiveness. It involves selecting the right type of
process (such as job shop, batch, repetitive,
continuous, or project) based on factors like product
variety, volume. Ensure that the workflow is smooth,
Goal resources are utilized effectively, and
the organization can respond quickly
to customer demands.
04
IMPORTANCE OF
Process selection
OPTIMAL RESOURCE UTILIZATION
Process selection is crucial because it helps
organizations "make the best use of time,
materials, and labor to meet business goals"
ENHANCED PERFORMANCE OUTCOMES
By organizing processes effectively,
companies can improve their overall
performance and customer satisfaction.
05
Overview of process
selection
Process Selection: This is about picking
the best way to make a product or provide
a service. There are different types ( job
shop, batch, repetitive, continuous, or
project)
06
Overview of process
selection
Capacity Planning: This is figuring out how much
product you need to make and how much space
and equipment you’ll need to do it. It answers
questions like: How much can we produce? When
do we need to produce it? What kind of setup do
we need?
07
Overview of process
selection
System Design: This is how the whole
production area is arranged, including where
machines go and how workers move around.
The design needs to match the process and
capacity plans.
08
Overview of process
selection
How They Work Together:
Choosing a Process Affects Design: The way you
decide to make something will change how you set up
your workspace. For example, if you choose a job shop
process, you need a flexible layout to handle different
tasks. If you choose a repetitive process, you might set
up a straight line for assembly.
Capacity Planning Affects Design: How much you plan
to produce will also change your setup. If you need to
make a lot of products, you’ll need more machines and
space.
09
VOLUME
- Quantity of products or services produced by an organisation.
- A high-volume business will have a high product and process
repeatability and will have specialised labour, processes, and equipment.
- Low-volume business operations, making a small number of things or
providing a small number of services each year
VARIETY
The number of different “types” of products or services produced and how
different they are from each other. A business may be very specialised, with
next to no variety in the products it makes.
10
II. PROCESS TYPE 1 Job Shop
2 Batch
3 Repetitive
4 Continuous
5 Project
11
JOB SHOP A job shop usually operates on a relatively
small scale.
IT IS USED WHEN A LOW VOLUME OF HIGH-
VARIETY GOODS OR SERVICES WILL BE NEEDED
PROCESSING IS INTERMITTENT
Work includes small jobs, each with somewhat different
processing requirements.
HIGH FLEXIBILITY
Using general-purpose equipment and skilled workers are
important characteristic of a job shop
12
BATCH
Is used when a moderate volume of goods or services is
desired, and it can handle a moderate variety in products or
services
THE EQUIPMENT NO NEED TO BE FLEXIBLE
Processing is still intermittent.
THE SKILL LEVEL OF WORKERS NO NEED TO BE HIGH
There is less variety in the jobs being processed.
13
Example
SYSTEMS PRODUCTS SERVICES
Bakeries, which make bread, Ice cream, soft drinks, beer, Plays, concerts, music
cakes, or cookies in batches magazines, and books. videos, radio and television
Movie theaters, which show pro grams, and public
movies to groups (batches) address announcements.
of people
Airlines, which carry
planeloads (batches) of
people from airport to
airport
14
Repetitive (Assembly)
Definition
Produce large volumes of standardized goods or
services.
The standardized output means only slight flexibility
of equipment is needed and flow are mostly fixed
(like conveyor belts).
The process is repetitive and broken into simple
tasks.
Workers need only basic skills.
15
Repetitive (Assembly)
Example
Examples
for products
Automotive manufacturing Making pencils
16
Repetitive (Assembly)
Example for services
Automatic car wash Cafeteria lines
17
CONTINUOUS
Definition
Used for very high volume and very
standardized products
Operates 24 hours per day to be cost-
effective
Products usually flow continuously (not in
individual units).
Requires highly specialized equipment,
designed for one type of product.
Worker skill levels can be low to high,
depending on system complexity.
18
CONTINUOUS Example for products
Steel products
Petroleum products
19
CONTINUOUS Example for services
Providing Internet Access
Air monitoring
20
Compare four basic processing type
Repetitive/
Job Shop Batch Continuous
Assembly
Flexible, easy to
Handles a wide Low unit cost, Very efficient, high
change products
Advantages variety of work. high volume, volume.
or services.
efficient.
Slow, high cost Moderate cost per Very rigid, lack of
per unit, unit, moderate variety, costly to
Low flexibility, high
Disadvantages complex scheduling change, very high cost
cost of downtime
planning and complexity of downtime
scheduling
21
Project Definition Used for nonroutine work with a unique
set of objectives to be accomplished
within a limited timeframe.
Project processes are temporary, with a
clear start and end, and are tailored to
achieve distinct goals, often requiring
flexible equipment and a range of worker
skills (low to high).
It is designed to manage one-of-a-kind or
highly customized tasks that produce a
specific output, such as a product, service,
The project process influences organizational or result.
activities, including resource allocation,
scheduling, and supply chain management
22
Project
Example: Consider a project to build a bridge
Objective Outcome
Construct a 200-meter A completed bridge, with
pedestrian bridge within the process concluding
12 months. once the project is
delivered and accepted.
Process
The project involves unique tasks like designing the
bridge, securing permits, procuring materials and
coordinating specialized workers . The supply chain must
handle irregular orders and adapt to potential delays.
23
TOYOTA [Link]
Toyota
production
system
LEAN MANUFACTURING
24
INTRODUCTION ABOUT TOYOTA
A Japanese multinational Headquarter: Toyota City,
Founder: Kiichiro Toyoda
automotive manufacturer Aichi, Japan
25
TOTAL VEHICLE
PRODUCTION
Other
5%
North America Japan remains Toyota’s largest production base
25%
Japan serves as Toyota’s global benchmark for
efficiency and innovation
9,263,035
Japan
40% (March 31, 2024) Thailand, Indonesia, and India contribute
Europe
significantly to regional demand and export
10%
North America and Europe play a significant role
Asia (excluding Japan)
20%
26
TOYOTA PRODUCTION SYSTEM
The Toyota Production System (TPS) is the best-known
example of lean processes in action. It has become a model
for competitive manufacturing throughout the world. It has
been evolving within Toyota for decades.
The basic philosophy of the TPS
JIDOKA
“Automation with human touch”: Machines and humans work
together to detect, handle, and prevent defects during the
production process.
JUST-IN-TIME
Making only what is needed, when it is needed,
and in the amount needed.
27
Automatic Detection and Stop
The machine or equipment can detect
JIDOKA
the abnormality and stop automatically
Andon Light System
The use of an Andon light is a key visual
tool in Jidoka. It plays an essential role in
communication, quality control, and quick
PHILOSOPHY
problem response.
Human Intervention
The operator can stop the line by
pulling the stop cord themselves and
addressing immediately.
28
Automatic Detection and Stop
The machine or equipment can detect
the abnormality and stop automatically
JIDOKA
Andon Light System
The use of an Andon light is a key visual
tool in Jidoka. It plays an essential role in
communication, quality control, and quick
problem response.
PHILOSOPHY
Human Intervention
The operator can stop the line by
pulling the stop cord themselves and
addressing immediately.
Reduces Need for Constant Human Monitoring
29
Automatic Detection and Stop
The machine or equipment can detect
the abnormality and stop automatically
JIDOKA
Andon Light System
The use of an Andon light is a key visual
tool in Jidoka. It plays an essential role in
communication, quality control, and quick
Real-Time Problem Signaling
problem response.
PHILOSOPHY
Human Intervention
The operator can stop the line by
pulling the stop cord themselves and
addressing immediately.
Reduces downtime by solving problems early
30
Automatic Detection and Stop
The machine or equipment can detect
the abnormality and stop automatically
JIDOKA
Andon Light System
The use of an Andon light is a key visual
tool in Jidoka. It plays an essential role in
communication, quality control, and quick
problem response.
PHILOSOPHY
Human Intervention
The operator can stop the line by
pulling the stop cord themselves and
addressing immediately.
Eliminating the outflow of defective products
31
JUST-IN-TIME PHILOSOPHY
Making only what is needed
Only make what is needed by the customer
32
JUST-IN-TIME PHILOSOPHY
Making only what is needed, when it is needed
Only make what is needed by the customer
Parts and materials arrive at the factory just
in time for the production process.
33
JUST-IN-TIME PHILOSOPHY
Making only what is needed, when it is needed,
and in the amount needed.
Only make what is needed by the customer
Parts and materials arrive at the factory just
in time for the production process.
Toyota doesn’t produce excess inventory
which may be wasteful and costly.
34
BENEFITS OF Minimize the storage cost
JUST-IN-TIME
Reduce the risk of
inventory becoming
obsolete
Quick response to
customer demand
35
TOYOTA PRODUCTION SYSTEM HOUSE
JUST-IN-TIME
JIDOKA
[Right part, right JIDOKA
[Stop to fix problems]
time, right amount] [Stop to fix problems]
Make problems visible
Reduce inventory to
Make problems visible
surface problems
36
TOYOTA PRODUCTION SYSTEM HOUSE
Best Quality - Lower Cost - Shortest Lead Time - Best Safety - High
Morale through shortening production flow by eliminating waste
JUST-IN-TIME People and Teamwork
JIDOKA
[Right part, right [Stop to fix problems]
time, right amount]
CONTINUOUS IMPROVEMENT
Reduce inventory to
Make problems visible
surface problems Waste Reduction
Stable and standardlized Processes
37
TOYOTA
HIGH VOLUME
38
TOYOTA
A W I D E V A R I E T Y O F V E H I C L E S
TOYOTA SEDAN
39
TOYOTA
A W I D E V A R I E T Y O F V E H I C L E S
TOYOTA SUV
40
TOYOTA
A W I D E V A R I E T Y O F V E H I C L E S
TOYOTA TRUCK
41
TOYOTA
A W I D E V A R I E T Y O F V E H I C L E S
ELECTRIC CAR
42
EUROPE
REGION-CENTERED MANAGEMENT
Style Driving range
TOYOTA ED2 TOYOTA ED2 TOYOTA BZ4X
43
ASIA
REGION-CENTERED MANAGEMENT
Quality Durability
Reliability Affordability
TOYOTA CAMRY TOYOTA HILUX TOYOTA VELLFIRE
44
MERICA
RTH A
NO
REGION-CENTERED MANAGEMENT
Large cars Pickup Trucks
TOYOTA AVALON 2022 TOYOTA TACOMA 2025
45
TOYOTA
HIGH VOLUME HIGH VARIETY
46
MINIGAME
Reinforce your understanding
47
THANK YOU
FOR YOUR
ATTENTION
REFERRENCES
Operations Management, Twelfth Edition (William J.
Stevenson)
Toyota Integrated Report 2024
[Link]
The Toyota Way in Services: The Case of Lean Product
Development (Journal: Production Engineering-research
and development)
48
Question Given that Toyota produces a wide variety of vehicles (sedans, SUVs, trucks, EVs), how does it balance the
tension between high volume and high variety in its production system? Could there be a point where
variety negatively impacts efficiency?
Answer
Toyota’s Toyota Production System (TPS) is renowned for its ability to produce a high volume
of vehicles while maintaining a diverse product portfolio, including sedans, SUVs, trucks, and
electric vehicles (EVs). By leveraging key strategies like Just-in-Time (JIT), Jidoka, modular
design, and region-centered management, Toyota effectively manages the tension between
high volume and high variety. However, excessive variety can challenge efficiency, and there
How Toyota Balances High are critical points where this balance may falter.
Volume and High Variety 1. Just-in-Time (JIT) and Lean Inventory Management:
in Its Production System Impact on Variety and Volume: By maintaining low inventory levels, Toyota avoids
overstocking parts for low-demand variants, which preserves efficiency even when
producing a wide range of vehicles. JIT’s flexibility allows Toyota to dynamically adjust
production to meet fluctuating customer demands for different models, supporting both high
variety and high throughput.
Example: A single assembly line can produce a Corolla sedan followed by a RAV4 SUV, with
parts arriving just-in-time to support each model, ensuring high-volume output without
sacrificing variety.
Answer 2. Jidoka (Automation with a Human Touch)
Impact on Variety and Volume: By catching defects early, Jidoka prevents quality issues
from scaling across high-volume production runs, reducing costly rework. This ensures
that diverse products meet Toyota’s stringent quality standards without disrupting the
efficiency of large-scale manufacturing.
3. Supporting Strategies:
Modular Design and Platform Sharing (TNGA): Toyota’s TNGA platform enables multiple
How Toyota Balances High vehicle types (e.g., Corolla, RAV4, Camry) to share components like chassis and engines,
Volume and High Variety reducing production complexity. This supports high-volume production of standardized
parts while allowing customization for diverse market demands.
in Its Production System
Mixed-Model Production: Toyota’s flexible assembly lines produce various models on the
same line using advanced scheduling. Trained workers and machines handle model
variations, minimizing downtime and ensuring high-volume output with diverse offerings.
Region-Centered Management: Toyota aligns product variety with regional preferences,
focusing on hybrids in Europe and SUVs/trucks in North America. This targeted approach
avoids low-demand variants, maintaining efficiency while meeting diverse regional
needs.
Answer 1. Increased Complexity in Production:
As the number of vehicle variants (e.g., unique models, trims, or customizations) grows,
the complexity of scheduling, assembly, and inventory management increases. For
example, producing too many low-volume variants could require frequent line
changeovers, slowing production and increasing costs.
Tipping Point: If the number of unique configurations exceeds the capacity of mixed-model
Potential Point Where lines or modular platforms, setup times and production costs could rise significantly,
eroding the benefits of high-volume production.
Variety Negatively
Impacts Efficiency
2. Supply Chain Strain:
High variety requires suppliers to produce and deliver a broader range of parts. If variety
becomes too extensive, suppliers may struggle to keep up with JIT demands, leading to
delays or increased inventory costs.
Tipping Point: If suppliers cannot scale their production to match Toyota’s variety without
compromising JIT delivery, production bottlenecks could occur.
Answer 3. Diminishing Returns on Customization:
Offering excessive customization options (e.g., unique features for niche markets) can
lead to low-volume production runs for certain parts or models, which may not justify the
cost of production or inventory management.
Tipping Point: When the cost of producing low-demand variants outweighs their market
value, efficiency and profitability decline.
4. Worker and System Overload:
Potential Point Where High variety requires workers and automated systems to handle more complex tasks,
such as switching between different assembly processes. Excessive variety could
Variety Negatively
overwhelm workers or require costly retraining and system upgrades.
Impacts Efficiency
Tipping Point: If the training or system reconfiguration time becomes too significant, it
could slow down production and increase error rates.
5. Market Demand Misalignment
If Toyota overestimates demand for certain variants, it risks producing vehicles that don’t
sell, tying up resources and inventory. Conversely, underestimating demand for popular
variants could lead to lost sales.
Tipping Point: Excessive variety without accurate demand forecasting could lead to
overproduction of niche models, reducing overall efficiency.