Process Analysis

TOPICS
Process Analysis

Process Flowcharting

Types of Processes

Measuring Process Performance

2
Process Analysis
Process
 any part of an organization that takes inputs and
transforms them into outputs

Process Analysis
 Why?
 How detailed?
 Outputs
 Number of customers handled/hr
 Time taken/customer
 Cost
 How to increase capacity

3
Process Analysis Terms
Cycle Time
 repetitive process
 Average time between completions of successive
units
 Units/hr

Utilization
 ratio of the time that a resource is actually
activated relative to the time that it is available for
use
 Linked to cost, price & revenue

4
Process Flowcharting
use of a diagram to present the major elements
of a process

basic elements
 tasks or operations
 flows of materials or customers
 decision points
 storage areas or queues

ideal method to begin analyzing a process

5
Flowchart Symbols
Tasks or operations Examples:
Examples:Giving
Givingan an
admission
admissionticket
tickettotoaa
customer,
customer,installing
installingaaengine
engine
ininaacar,
car,etc.
etc.

Decision Points Examples:

Examples:Custom/
Custom/Standard?
Standard?
Which
Whichtool
toolshould
shouldbe
beused,
used,
etc.
etc.

6
Flowchart Symbols
Storage areas or Examples:
Examples:Sheds,
Sheds,lines
linesofof
queues people
peoplewaiting
waitingfor
foraaservice,
service,
etc.
etc.

Flows of materials or Examples:

Examples:Customers
Customersmoving
moving
customers to
toaaseat,
seat,mechanic
mechanicgetting
gettingaa
tool,
tool,etc.
etc.

7
Example: Flowchart of Student Going to Class

Yes
Walk to
Go to class Get ready class
today?

No

Sleep
off

8
Types of Processes
Single-stage Process

Stage 1

Multi-stage Process

Stage 1 Stage 2 Stage 3

9
Process Terminology
Buffer
a storage area between stages where the output of
a stage is placed prior to being used in a
downstream stage

Multi-stage Process with Buffer

Buffer
Stage 1 Stage 2

10
11
Process Terminology
Blocking
 activities in a stage stops because there is no place to
deposit the item just completed
 if there is no room for an employee to place a unit of
work down, he will hold on to it not able to continue
working on the next unit

Starving
 activities in a stage stops because there is no work
 if an employee is waiting at a work station and no
work is coming to him to process, he will remain idle
until the next unit of work comes

12
Other Process Terminology (Continued)
Bottleneck
Occurs when the limited capacity of a process
causes work to pile up or become unevenly
distributed in the flow of a process

If an employee works too slow in a multi-stage

process, work will begin to pile up in front of that
employee. This employee represents the limited
capacity causing the bottleneck.

13
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
Hybrid
14
15
Other Types of Processes
Paced Processes
Non-paced Processes

Pacing
movement of items through a process
coordinated through a timing mechanism

16
Process performance metrics
Utilization
Productivity
Efficiency
Actual output of a process relative to some standard
Used to measure loss/ gain in a process
Run time
Setup time
Operation time = Setup time + Run time

17
Process performance metrics
Cycle time
Throughput time (Flow time)
Average time for a unit to move through the system
Throughput rate
Output rate that the process is expected to produce over
a period of time
Process velocity (Throughput ratio)
Value-added time /Throughput time
Value-added time

18
Process performance metrics

19
 6-20

Cycle Time Example

Suppose
Supposeyouyouhad
hadto
toproduce
produce600
600units
unitsin
in80
80hours
hoursto
to
meet
meetthe
thedemand
demandrequirements
requirementsof
ofaaproduct.
product.
What
Whatisisthe
thecycle
cycletime
timeto
tomeet
meetthis
thisdemand
demand
requirement?
requirement?

Answer:
Answer:There
Thereare
are4,800
4,800minutes
minutes(60
(60minutes/hour
minutes/hourxx8080hours)
hours)in
in8080hours.
hours. So
So
the average time between completions would have to be: Cycle time =
the average time between completions would have to be: Cycle time =
4,800/600
4,800/600units
units==88minutes.
minutes.

20
Paced assembly line

21
Little’s Law
Throughput time = WIP/ Throughput rate
Assume
Process operating at steady rate

22
Little’s law example
An automobile company makes cars with batteries costing
$45.
They take 12 hrs to make a car in the plant
Assembles 200 cars per 8 hr shift (1 shift per day)
They hold 8000 batteries in raw material inventory as
buffer
What is the total number of batteries in the plant on average
(RM & WIP)
How much are these batteries worth?
How many days of supply are held in raw material inventory
on average?
23
Bread making

24
Process Throughput Time Reduction

Perform activities in parallel

Change the sequence of activities

Reduce interruptions

25
Process as a funnel

26