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Operations TechnologyOperations Technology

Operations ManagementFor Competitive Advantage

CHASE AQUILANO JACOBS

ninth edition

Supplement C

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Supplement C

Operations Technology

Hardware Systems

Software Systems

Formula for Evaluating Robots

Computer Integrated Manufacturing

Technologies in Services Benefits

Risks

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Hardware Systems

Numerically controlled (NC) machines

Machining centers

Industrial robots

Automated material handling (AMH) systems

Automated Storage and Retrieval Systems (AS/AR)

Automate Guided Vehicle (AGV)

Flexible manufacturing systems (FMS)

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Formula for Evaluating a Robot

InvestmentThe payback formula for an investment in robots is:

P = IL E + q(L + Z)

WhereP = Payback period in yearsI = Total capital investment required in robot and accessoriesL = Annual labor costs replaced by the robot (wage and

benefit costs per worker times the number of shifts per day)

E = Annual maintenance cost for the robotZ = Annual depreciationq = Fractional speedup (or slowdown) factor (in decimals).Example: If robot produces 150 % of what the normal worker iscapable of doing, the fractional speedup factor is1.5.

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Example of Evaluating a Robot

InvestmentSuppose a company wants to buy a robot. The bank wantsto know what the payback period is before they will lendthem the $120,000 the robot will cost. You have determinedthat the robot will replace one worker per shift, for a one shiftoperation. The annual savings per worker is $35,000. Theannual maintenance cost for the robot is estimated at $5,000,with an annual depreciation of $12,000. The estimatedproductivity of the robot over the typical worker is 110%.

What is the payback period of this robot?

P = I = 120,000 =1.47yearsLE+q(L + Z) 35,0005,000+1.1(35,000+12,000)

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Software Systems

Computer-aided-design (CAD)

Computer-aided engineering (CAE)

Computer-aided process planning (CAPP)

Automated manufacturing planning andcontrol systems (MP & CS)

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Computer Integrated

Manufacturing (CIM) Product and process design

Planning and control

The manufacturing process

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Technologies in Services

Office automation

Image processing systems

Electronic data interchange (EDI)

Decision support systems & expertsystems

Networked computer systems

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Cost Reduction Benefits from

Adopting New Technologies Labor costs

Material costs

Inventory costs

Transportation or distribution costs

Quality costs

Other costs

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Other Benefits.

Increased product variety

Improved product features and quality

Shorter cycle times

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Risks

Technological risks

Organizational risks

Environmental risks

Market risks