Operations Management For Competitive Advantage ninth edition 1
CHASE AQUILANO JACOBS
Operations Management
For Competitive Advantage
Chapter 4
Process Analysis
CHASE AQUILANO JACOBS ninth edition
©The McGraw-Hill Companies, Inc., 2001
Operations Management For Competitive Advantage ninth edition 2
Chapter 4
Process Analysis
Process Analysis
Process Flowcharting
Types of Processes
Process Performance Metrics
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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.
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Process Flowcharting
Defined
Process flowcharting is the use of a
diagram to present the major elements of a
process. The basic elements can include
tasks or operations, flows of materials or
customers, decision points, and storage
areas or queues.
It is an ideal methodology by which to begin
analyzing a process.
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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.
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Flowchart Symbols (Continued)
Storage areas or Examples: Sheds,
queues lines of people waiting
for a service, etc.
Flows of Examples: Customers
materials or moving to the a seat,
customers mechanic getting a
tool, etc.
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Example: Flowchart of Student Going
to School
Go to Yes
Drive to Walk to
school school
today? class
No
Goof
off
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Multistage Process
Stage 1 Stage 2 Stage 3
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Multistage Process with Buffer
Buffer
Stage 1 Stage 2
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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 forecast
demand.
– Customer orders are served from target stocking
level.
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Process Performance Metrics
Operation time = Setup time
Run time
Throughput time = Average time for a unit to
move through the system
Velocity = Throughput time
Value-added time
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Process Performance Metrics
(Continued)
Cycle time = Average time between
completion of units
Throughput rate = 1 .
Cycle time
Efficiency = Actual output
Standard Output
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Process Performance Metrics
(Continued)
Productivity = Output
Input
Utilization = Time Activated
Time Available
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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?
Answer: There are 4,800 minutes (60
minutes/hour x 80 hours) in 80 hours. So the
average time between completions would
have to be: Cycle time = 4,800/600 units = 8
minutes.
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Process Throughput Time Reduction
Perform activities in parallel.
Change the sequence of activities.
Reduce interruptions.
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