Process Flow Structures

The flow structure of the process used to make or deliver a product or service impacts facility layout, resources, technology decisions, and work methods. The process architecture may be an important component in the firm's strategy for building a competitive advantage.

When characterized by its flow structure, a process broadly can be classified either as a job shop or a flow shop. A job shop process uses general purpose resources and is highly flexible. A flow shop process uses specialized resources and the work follows a fixed path. Consequently, a flow shop is less flexible than a job shop.

Finer distinctions can be made in the process structure as follows:

• Project - Example: building construction
• Job shop - Example: print shop
• Batch process - Example: bakery
• Assembly line - Example: automobile production line
• Continuous flow - Example: oil refinery

These process structures differ in several respects such as:

• Flow - ranging from a large number of possible sequences of activities to only one possible sequence.

• Flexibility - A process is flexible to the extent that the process performance and cost is independent of changes in the output. Changes may be changes in production volume or changes in the product mix.

• Number of products - ranging from the capability of producing a multitude of different products to producing only one specific product.

• Capital investment - ranging from using lower cost general purpose equipment to expensive specialized equipment.

• Variable cost - ranging from a high unit cost to a low unit cost.

• Labor content and skill - ranging from high labor content with high skill to low content and low skill.

• Volume - ranging from a quantity of one to large scale mass production.

It is interesting to note that these aspects generally increase or decrease monotonically as one moves between the extremes of process structures. The following chart illustrates how the process characteristics vary with structure.

Comparison of Process Structures and Characteristics

	Project	Job Shop	Batch Process	Assembly Line	Continuous Flow
Flow	None  Continuous
Flexibility	High  Low
No. of Products	High  Low
Capital Investment	Low  High
Variable Cost	High  Low
Labor Content	High  Low
Labor Skill	High  Low
Volume	Low  High

The following sections describe each of the architectures, highlighting their differentiating characteristics.

Project

• Flow - no flow
• Flexibility - very high
• Products - unique
• Capital investment - very low
• Variable cost - very high
• Labor content and skill - very high
• Volume - one

In a project, the inputs are brought to the project location as they are needed; there is no flow in the process. Technically, a project is not a process flow structure since there is no flow of product - the quantity produced usually is equal to one. It is worthwhile, however, to treat it as a process structure here since it represents one extreme of the spectrum.

Projects are suitable for unique products that are different each time they are produced. The firm brings together the resources as needed, coordinating them using project management techniques.

Job Shop

• Flow - jumbled flow
• Flexibility - high
• Products - many
• Capital investment - low
• Variable cost - high
• Labor content and skill - high
• Volume - low

A job shop is a flexible operation that has several activities through which work can pass. In a job shop, it is not necessary for all activities to be performed on all products, and their sequence may be different for different products.

To illustrate the concept of a job shop, consider the case of a machine shop. In a machine shop, a variety of equipment such as drill presses, lathes, and milling machines is arranged in stations. Work is passed only to those machines required by it, and in the sequence required by it. This is a very flexible arrangement that can be used for wide variety of products.

Batch Process