Example: Receiving goods to warehouse Detailed view Receive Goods Inspect Goods (30) Match order? (10) Supervisor Report (5) Quality Check (45) Accept? (2) Goods 4 pick up Inform Purchasing Yes No Yes No What is the throughput time for good items? What is the capacity of each station? Where is the bottleneck? What is the cycle time? What is the throughput rate? If there are 15 orders coming in an 8 hr day, what would each stations utilization rate be?

Solution – part 1 (single QC station) Throughput Time for good items = 87 minutes Throughput Time for bad orders = 45 minutes Throughput Time for bad quality = 92 minutes Cycle time is 45 minutes Throughput rate for good orders is 10 orders / day Inspection capacity 2 orders/ hr = 16 orders / day (assuming 8 hr day) utilization rate = 15/16 = 94% Matching orders capacity 6 orders / hr = 48 orders / day utilization rate = 15/48 = 31% Supervisor Reports capacity= 12 orders / hr = 96 orders / day MAX utilization rate = 15/96 = 16% Quality Check capacity = 480 / 45 = 10 orders / day MAX utilization rate = 15/10 = 150% Acceptance processing capacity 30 orders / hr = 240 orders / day MAX utilization rate = 15/240= 6% Bottleneck for good orders is quality check Bottleneck for bad orders is inspect goods Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall.

Example: Receiving goods to warehouse Detailed view Receive Goods Inspect Goods (30) Match order? (10) Supervisor Report (5) Quality Check (45) Accept? (2) Goods 4 pick up Inform Purchasing Yes No Yes No If we get 15 orders in an 8 hr day, what would the utilization rate be for each station? Quality Check (45) What is the throughput time for good items? What is the capacity of each station? Where is the bottleneck? What is the cycle time? What is the throughput rate?

Solution – part 2 (Two QC stations) Throughput Time for good items = 87 minutes Throughput Time for bad orders = 45 minutes Throughput Time for bad quality = 92 minutes Throughput rate is 16 orders/ day Cycle time is 30 minutes Inspection capacity 2 orders/ hr = 16 orders / day (assuming 8 hr day) utilization rate = 15/16 = 94% Matching orders capacity 6 orders / hr = 48 orders / day utilization rate = 15/48 = 31% Supervisor Reports capacity= 12 orders / hr = 96 orders / day MAX utilization rate = 15/96 = 16% Quality Check capacity = 480 / 22.5 = 21 orders / day MAX utilization rate for each station = 15/21 = 71% Acceptance processing capacity 30 orders / hr = 240 orders / day MAX utilization rate = 15/240= 6% Bottleneck for ALL orders is inspect goods Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall.