Irwin/McGraw-Hill 1 Process Analysis Terms Process: Is any part of an organization that takes inputs and transforms them into outputs. Cycle Time: Is the average successive time between completions of successive units. Utilization: Is the ratio of the time that a resource is actually activated relative to the time that it is available for use.

Irwin/McGraw-Hill 2 Process Flowcharting Process flowcharting is the use of a diagram to present the major elements of a process. These basic elements can include: tasks or operations flows of materials or customers decision points storage areas or queues. It is an ideal methodology by which to begin analyzing a process.

Irwin/McGraw-Hill 3 Flowchart Symbols Tasks or Operations Examples: Giving an admission ticket to a customer, installing a engine in a car, etc. Decision Points Examples: How much change should be given to a customer, which wrench should be used, etc.

Irwin/McGraw-Hill 4 Flowchart Symbols (Cont.) Storage areas or queues Examples: Sheds, lines of people waiting for a service, etc. Flows of materials or customers Examples: Customers moving to their seat, mechanic getting a tool, etc.

Irwin/McGraw-Hill 5 Example Flowchart: Student Going to School Yes No Goof off Go to school today? Walk to class Drive to school

Irwin/McGraw-Hill 6 Process Flowchart - Improving the Apartment Rent-Ready Process

Irwin/McGraw-Hill 7 Multistage Processes Stage 1Stage 2Stage 3 Multistage Process with Buffer Stage 1Stage 2 Buffer

Irwin/McGraw-Hill 8 Multi-Stage Processes Buffering Refers to a storage area between stages where the output of a stage is placed prior to being used in a downstream stage. Buffers allow stages to operate independently. Work-in-process (WIP) inventory will accumulate in the buffer. No Buffering Blocking: Occurs when activities in a stage must stop because there is no place to deposit the item just completed. Starving: Occurs when the activities in a stage must stop because there is no work.

Irwin/McGraw-Hill 9 Other Types of Processes Make-to-order Only activated in response to an actual order. Both work-in-process and finished goods inventory kept to a minimum. Make-to-stock Process activated to meet expected or forecasted demand. Customer orders are served from target stocking level.

Irwin/McGraw-Hill 10 Process Performance Metrics Operation time = Setup time + Run time Cycle time = Average time between completion of units Throughput rate = 1/Cycle time Throughput time = Average time for a unit to move through the system* * Note: Little’s Law computes throughput time while in (work-in-process) inventory only

Irwin/McGraw-Hill 11 Cycle Time Example Suppose you had to produce 600 units in 80 hours to meet the demand requirements of a product. What is the cycle time to meet this demand requirement?

Irwin/McGraw-Hill 12 Bread-Making Operation See pp ( in old text). For homework, construct a table, showing the amount baked, amount packed, and WIP for each hour of the day (3 eight hour shifts). Calculate the Throughput Time in WIP Inventory using Little’s Law; then calculate the Total Throughput Time by adding the time in WIP inventory to the baking and packing times.