Intended learning outcomes: Present important features and possible values referring to a product. Differentiate between a convergent product structure and a divergent product structure. Disclose the VA analysis within the VAT analysis.
Figure 4.4.2.1 shows the first group of features.
Fig. 4.4.2.1 Important features and possible values referring to the user and the product or product family.
The depth of product structure is defined as the number of structure levels within the total supply chain for the product, whether company-internal or transcorporate.
Product structure and structure level are defined in Section 1.2.2. The depth of product structure is dependent on the product. A deep product structure is usually also “wide”: in each structure level, many components are put together. Such complex products usually entail complex planning & control. The depth of product structure is thus also a measure of the complexity of planning & control in the supply chain (see also [Albe95]). This complexity influences planning & control in each of the companies involved in the supply chain. See the feature depth of product structure in the company in Section 4.4.3.
The orientation of product structure indicates whether in one single production process a certain product is manufactured from various components (symbol ▲, convergent product structure), or whether in one single production process various products are made out of a certain component (symbol ▼, divergent product structure).
- Convergent product structure is often used as a synonym for discrete manufacturing, that is, the production of distinct items such as machines or appliances. It is also called assembly orientation. The triangle pointing up symbolizes a tree (or arborescent) structure, as the product structure, such as that in Figure 1.2.2.2.
- Divergent product structure is often used as a synonym for by-products arising in continuous production (see Section 4.4.3). In chemical or oil production, which are typical examples from the process industry, processing of the basic material yields — in one single process — several active substances as well as waste or by-products. In the food industry, there are by-products that, through recycling, can be used as basic materials in another production process (such as scrap chocolate). The triangle pointing down symbolizes an upside-down, arborescent structure as the product structure. Note that a divergent product structure should not be confused with the multiple use of a component in different products.
- “▲ on ▼”: This is a product with divergent product structure at lower structure levels, and convergent product structure at higher structure levels. The (lower) chemical level of pharmaceutical products, for example, has a divergent product structure, while the (higher) pharmaceutical level has a convergent structure. Other examples are products made from sheet metals. Many semifinished goods arise simultaneously from the sheet metal through pressing or laser cutting, and they are then used for various end products.
Determining the values of this feature corresponds exactly to a part of the VAT analysis (the “VA part”):
VAT analysis determines the general flow of parts and products from raw materials to finished products. A V structure corresponds to the divergent product structure (the letter V has the same shape as the symbol ▼). An A structure corresponds to the convergent product structure (the letter A has the same shape as the symbol ▲). A T structure consists of numerous similar finished products assembled from common assemblies, subassemblies, and parts. See the feature product variety concept below.
A note on “▼ on ▲”: This sometimes symbolizes an end product having many variants and therefore addresses the T structure mentioned above. In the lower structure levels, semifinished items are put together as modules. In assembly, many variants of end products are built from the semifinished goods or subassemblies. This is the case with automobiles. But because final assembly is clearly based on an assembly-oriented, convergent product structure, it should not be represented by the upside-down triangle. It is not the case that several products will arise from a particular semi-processed item. Although the symbol may be used quite commonly for this case, it is used incorrectly. A separate feature for describing the variant structure is the product variety concept. See below.
Continuation in next subsection (4.4.2b).
Course section 4.4: Subsections and their intended learning outcomes
4.4 Characteristic Features Relevant to Planning & Control in Supply Chains
Intended learning outcomes: Produce an overview on principle and validity of characteristics in planning & control. Explain six features in reference to customer, and item or product or product family, five features in reference to logistics and production resources, as well as seven features in reference to the production or procurement order. Describe important relationships between characteristic features of transcorporate logistics in supply chains.
4.4.1 Principle and Validity of Characteristics in Planning & Control
Intended learning outcomes: Describe the characteristic in planning & control in a supply chain. Explain the use of the results of the analysis.
4.4.2 Features in Reference to a Product: Depth and Orientation of the Product Structure, and VAT Analysis
Intended learning outcomes: Present important features and possible values referring to a product. Differentiate between a convergent product structure and a divergent product structure. Disclose the VA analysis within the VAT analysis.
4.4.2b Features in Reference to Customer and Product Family: Frequency of Customer Demand and Product Variety Concept
Intended learning outcomes: Present important features and possible values referring to the customer demand and the product variety concept. Differentiate between continuous demand and discontinuous demand. Explain the product variety concept. Disclose the T analysis within the VAT analysis and its relation to the product variety concept.
4.4.2c Features in Reference to an Item: Unit Cost and Transportability
Intended learning outcomes: Present important features and possible values referring to an item: unit cost and transportability.
4.4.3 Features in Reference to Logistics and Production Resources: Production Environment and Depth of the Product Structure in the Company
Intended learning outcomes: Present important features and their possible values in reference to logistics and production resources. Explain the production environment: make-to-stock, assemble-to-order, make-to-order, and engineer-to-order. Differentiate the depth of product structure in the company from the depth of the product structure within the total supply chain.
4.4.3b Features in Reference to Production Resources: Facility Layout, Flexible Capability, Flexible Workforce, and Flexible Capacity
Intended learning outcomes: Present important features and their possible values in reference to production resources. Describe fixed-position manufacturing, job shop production, as well as single-item-oriented, high-volume and continuous line production. Differentiate flexible capability (of the production equipment), flexible workforce, and flexible capacity.
4.4.4 Features in Reference to the Production or Procurement Order: Reason for Order Release, Frequency of Order Repetition, and Flexibility of the Order Due Date
Intended learning outcomes: Present important features and possible values in reference to production or procurement order. Differentiate between order release according to demand, prediction, and consumption. Differentiate between production (or procurement) without, with infrequent, and with frequent order repetition. Identify the feature flexibility of the order due date.
4.4.4b Features in Reference to the Production or Procurement Order: Blanket Order, Lot Size or Batch Size, Lot Traceability, Loops in the Order Structure
Intended learning outcomes: Present important features and possible values in reference to production or procurement order. Identify the features type of long-term order and blanket order. Explain the concepts of lot size, lot traceability, and loops in the order structure.
4.4.5 Relationship between Facility Layout, Orientation of Product Structure, and (Order) Batch Size, and between Product Variety Concept, Production Environment, and Frequency of Order Repetition
Intended learning outcomes: Identify links among the features facility layout, orientation of product structure, and (order) batch size. Disclose links among the features product variety concept, production environment, and frequency of order repetition.
4.4.5b Relationship between the Frequency of Customer Demand and the Frequency of Order Repetition
Intended learning outcomes: Explain why the features frequency of customer demand and frequency of order repetition do not necessarily need to correspond.
4.4.6 Features of Transcorporate Logistics in Supply Chains
Intended learning outcomes: Present important features, possible values, and increasing complexity of supply chain collaboration, of supply chain coordination, and of the configuration of the supply chain.
