Manufacturing Environments and processes (1)

Every manufacturing business has its own environment and processes that might be shared with other business and therefore classified together based on it. Manufacturing environments and processes are the core to understand how the business’s supply chain is working. In this article we are going to discuss what are the different types of manufacturing environments and processes and the various features for every type.

When planning new manufacturing business, we need to identify which manufacturing environment and process will be chosen. Every environment has its own process type and layout that fits its nature. The manufacturing environment can be defined as the outline in which different manufacturing strategies, i.e. corporate, business unit, functional, and product / process selection and design, are established and executed. The manufacturing process can be defined as the series of actions performed to transform the raw materials into final product. The manufacturing process type and layout is selected based on the selected environment, as well as use and location of inventories.

The most common manufacturing environments are,

·      Engineered-To-Order (ETO): using project manufacturing process which necessitates high customer direction over design, features, and specifications for a unique and exclusive final product. As the final product is big in size, all resources are moving to a fixed location to finalize it. This will require a very long lead time to deliver. Airbus and Boeing are known for such manufacturing environment.

·      Make-To-Order (MTO): waiting for customer’s order to start production a low to medium volume of either standard product or custom designed one using intermittent manufacturing processes, like work center and batch, which require functional layout. The lead time vary from long to medium which depends on the availability of the raw materials for the custom request. This environment can be found in various industries like fashion, food and beverages, and furniture.

·      Assemble-To-Order (ATO): keeping a stock of semi-finished products that are awaiting for simple processing through cellular process layout to reflect the customer’s needs. This will help to diminish the lead time to be medium to short. Common example for this environment is metal can processing, i.e. the manufacturer keeps high volume from the standard designed cans and after receiving the customer order, the cans is been transferred to the process line to make the final assembly which differs from customer to another.

·      Make-To-Stock (MTS): using a product based layout with continuous flow process toward nonstop availability of the final product. This will help to get the lead time to be very short as the manufacturer keeps high volume of stock in warehouses. This will lead to high inventory value on the company’s balance sheet. For example, manufacturing of juice concentrates and purees from fruits when production time is limited to fruit season.  

From the above points, we can note that manufacturing process types vary from project to continuous passing by intermittent and flow types. Every type has its own layout that can fit with. Knowing what the business is going to produce and determining the suitable manufacturing environment and processes, will help to determine possible hitches that might show up and how to deal with them. We will have manufacturing processes in more details in another article.