MBA 8452 Systems and Operations ManagementMBA 8452 Systems and Operations Management

Process Process AnalysisAnalysis

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Process Analysis

Process Analysis

Process Analysis

Flow charting

Types of Processes

Process Performance

Job Design

Work Measurements

Incentive Plans

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What Is A Process?

Process is the basic building block of an operations/production system

A process is a collection of activities that transforms inputs into outputs that are valuable to the customer

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Process Flowchart Diagram showing the major

elements of a process and their interconnections

tasks or operations

flows of materials or customers

storage areas or queues.

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Process Flowchart Symbols

Tasks or operations

Decision Points

Storage areas or queues

Flows of materials or customers

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Process Flowchart Examples: Hamburger Making Process

1. McDonald’s

CookRaw

material Assemble

Customer order

Finished burgers Deliver

2. Burger King

CookRaw

material

Assemble

Customer order

Finished burgers

DeliverWIP Custom

or Standard?

Assemble

C

S

3. Wendy’sCustomer

order

CookRaw

material Assemble

Chili

Deliver

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Types of Processes

Single-stage vs. Multistage

Stage 1

Stage 1 Stage 2 Stage 3

Single-stage Process

Multistage Process

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Types of Process Multistage Process with Buffer

Stage 1 Stage 2Buffer

What might happen without buffer? Blocking Starving

Bottleneck

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Types of Process

Make-to-stock vs. Make-to-order

Make DeliverFinishedgoods

Customer order

Make Deliver

Customer order

Make-to-stock Process

Make-to-order Process

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“You can not improve something you can’t measure”

Process Performance Metrics Operation time = Setup time + Run time

Throughput time = Average time for a unit to move through the system

Cycle time = Average time between completion

of units

Throughput rate =

Velocity (throughput ratio) =

1Cycle time

Throughput timeValue-added time

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“You can not improve something you can’t measure” Process Performance Metrics (cont.)

Efficiency =

Productivity =

Utilization =

OutputInput

Time activatedTime available

Actual outputStandard output

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Little’s Law

Throughput time =Work-in-processThroughput rate

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Process Performance Metrics Example 1

5 min/unit 8 min/unit 3 min/unit

Stage 1 Stage 2 Stage 3

Cycle time = 8 minutes

Throughput rate = 60 units/day

Throughput time = 19 minutes

(Assume 8-hour working day)

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Process Performance Metrics Example 2

Stage 1 Stage 2Buffer

5 min/unit 8 min/unit

Stage 3

3 min/unit

Cycle time = 8 min

Throughput rate = 60 units/day

Throughput time = 5 + 144 + 8 + 3 = 160

min

(Assume 8-hour working day)

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Process Throughput Time Reduction

Perform activities in parallel

Change the sequence of activities

Reduce interruptions