McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.

4

Process Flow Structures

Job shop (ex. Copy center making a single copy of a student term paper)

Batch shop (ex. Copy center making 10,000 copies of an ad piece for a business)

Assembly Line (ex. Automobile manufacturer)

Continuous Flow (ex. Petroleum manufacturer)

Process Analysis

Process Flowcharting

Types of Processes

Process Performance Metrics

OBJECTIVES

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

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

Other Types of Processes

Make-to-orderOnly activated in response to an actual

orderBoth work-in-process and finished

goods inventory kept to a minimumMake-to-stock

Process activated to meet expected or forecast demand

Customer orders are served from target stocking level

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

Process Performance Metrics (Continued)

Cycle time = Average time betweencompletion of units

Throughput rate = 1 .

Cycle time

Efficiency = Actual output

Standard Output

Process Performance Metrics (Continued)

Productivity = Output

Input

Utilization = Time Activated

Time Available

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?

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.

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.

Process Throughput Time Reduction

Perform activities in parallel

Change the sequence of activities

Reduce interruptions

HighLowVolume

Cu

sto

miz

atio

nHigh

Low

Figure 3.1b

Project process• Real estate process for

leasing and constructing facilities for large insurance company

• Student team’s field project

Job process• Customer service process

at financial services firm• General medical practice

Batch process• Order fulfillment process of

importer/distributor• Placing purchase orders at

public relations agency

Line process• Cafeteria line• Teller line at bank

Continuous process• Power generation plant• Providing telephone line

access

HighLowVolume

Cu

sto

miz

atio

nHigh

Low

Figure 3.1a

Project process• Selecting location for

new plant in Europe• Installing ERP for a

manufacturing firm’s business processes

Job process• Machining precision

metal tubes• Internal consulting team

at manufacturing firm

Batch process• Forging process to make fittings

for pressure vessels access• Producing a batch of textbooks

at R. R. Donnelley’s plant

Line process• Auto assembly• King Soopers

bread line

Continuous process• Oil refining process• Borden’s pasta

making process

Units per year (Q)

Process 2:Process 2:Special-purposeSpecial-purposeequipmentequipment

Process 1:Process 1:General-purposeGeneral-purposeequipment equipment

Break-even quantity

F2

F1

To

tal

cost

(d

oll

ars)

Figure 3.4

HighLowVolume

Less vertical integration

More resource flexibility

More customer involvement

Less capital intensity/automation

More vertical integration

Less resource flexibility

Less customer involvement

More capital intensity/automation

Low volume, make-to-order process

High volume, make-to-stock process

Figure 3.5

Project process• Selecting location for new

plant in Europe• Installing ERP for a

manufacturing firm’s business processes

Job process• Machining precision metal

tubes• Internal consulting team at

manufacturing firm

Batch process• Forging process to make fittings

for pressure vessels access• Producing a batch of textbooks at

R. R. Donnelley’s plant

Line process• Auto assembly• King Soopers bread

line

Continuous process• Oil refining process• Borden’s pasta making

process

Pro

cess

des

ign

ch

oic

es

Pro

cess

des

ign

ch

oic

es

Less vertical integration

More resource flexibility

More customer involvement

Less capital intensity/automation

More vertical integration

Less resource flexibility

Less customer involvement

More capital intensity/automation

Low volume, customized-service process

High volume, standardized-service process

HighLowVolumeFigure 3.6

Project process• Real estate process for leasing

and constructing facilities for large insurance company

• Student team’s field project

Job process• Customer service process

at financial services firm• General medical practice

Batch process• Order fulfillment process of

importer/distributor• Placing purchase orders at public

relations agency

Line process• Cafeteria line• Teller line at bank

Continuous process• Power generation plant• Providing telephone line

access

* = Points critical to the success of the service † = Points at which failure is most often experienced

Customer drops off

car

Mechanic makes

diagnosis*

Discuss needed

work with customer*

Customer departs with car

Collect payment

Notify customer

Checkparts

availability†

Order parts

Repair complete

Figure 3.7

Repair not authorized

Parts available

Service visible to customerRepair authorized

Service not visible to customer

Perform work†

Inspect/ test and repair

Perform corrected

work

Corrective work necessary

Parts not available

To Accompany Krajewski & Ritzman Operations Management: Strategy and Analysis, Seventh Edition © 2004 Prentice Hall, Inc. All rights reserved.

Figure 4.8Figure 4.8

Process: Emergency room admissionSubject: Ankle injury patientBeginning: Enter emergency roomEnding: Leave hospital

Step no.

Time (min)

Distance (ft)

Summary

Number of stepsActivity

Time (min)

Distance (ft)

Step description

Insert Step

Append Step

Remove Step

1 X Enter emergency room, approach patient window 2 X Sit down and fill out patient history3 X Nurse escorts patient to ER triage room4 X Nurse inspects injury5 X Return to waiting room

6 X Wait for available bed 7 X Go to ER bed8 X Wait for doctor9 X Doctor inspects injury and questions patient

10 X Nurse takes patient to radiology

11 X Technician x-rays patient12 X Return to bed in ER13 X Wait for doctor to return14 X Doctor provides diagnosis and advice15 X Return to emergency entrance area

16 X Check out17 X Walk to pharmacy18 X Pick up prescription 19 X Leave the building

0.50 1510.0 -0.75 403.00 -0.75 40

1.00 -1.00 604.00 -5.00 -2.00 200

3.00 -2.00 2003.00 -2.00 -1.00 604.00 -2.00 1804.00 -1.00 20

Transport 9 11 815 Operation 5 23 —

Inspect 2 8 —

Store — — —Delay 3 8 —

Figure 3.8

Process: Emergency room admissionSubject: Ankle injury patientBeginning: Enter emergency roomEnding: Leave hospital

1 0.50 15 X Enter emergency room, approach patient window 2 10.0 - X Sit down and fill out patient history3 0.75 40 X Nurse escorts patient to ER triage room4 3.00 - X Nurse inspects injury5 0.75 40 X Return to waiting room

6 1.00 - X Wait for available bed 7 1.00 60 X Go to ER bed8 4.00 - X Wait for doctor9 5.00 - X Doctor inspects injury and questions patient

10 2.00 200 X Nurse takes patient to radiology

11 3.00 - X Technician x-rays patient12 2.00 200 X Return to bed in ER13 3.00 - X Wait for doctor to return14 2.00 - X Doctor provides diagnosis and advice15 1.00 60 X Return to emergency entrance area

16 4.00 - X Check out17 2.00 180 X Walk to pharmacy18 4.00 - X Pick up prescription 19 1.00 20 X Leave the building

Step no.

Time (min)

Distance (ft)

Summary

Number of stepsActivity

Time (min)

Distance (ft)

Transport 9 11 815 Operation 5 23 —

Inspect 2 8 —

Store — — —Delay 3 8 —

Step description

Insert Step

Append Step

Remove Step

Product-Flow CharacteristicsTypes of Product Flow

Line FlowBatch FlowProject Flow

Characteristics of Flows (see Table 4.1)

WS 1 WS 2 WS 3

WS Task or work station

Product flow

WS 1 WS 3 WS 5

WS Task or work station

Product flows

WS 2 WS 4

Start

Task 1 Task 3

Task Task or activity

Precedence relationship

Task 2 Task 4

End

Classification by Type of Customer OrderMake to Stock (MTS) (Standardisation) (Create Inventory,Push to Market)Make to Order(MTO) ( MKt Pull-No Invent.)

Assemble to Stock (Mass Customisation)Engineer to order (Higher Customisation)MTS >>>>ATS>>>>ETO >Increasing

Customisation

Make to Stock (MTS)Advantages Inventory for PeakDisadvantage Inv.Cost-ObsolescenceKey performance measuresInformation flow (see Figure 4.4)

Process Life Cycle StagesJumbled flow (job shop)Disconnected line flow (batch)Connected line flow (assembly line)Continuous flow

ILow volume-low standardization, one of a kind

CommercialPrinter

HeavyEquipment

Automobileassembly

SugarRefinery

IIMultiple products,low volume

IIIFew major productshigher volume

IIIHigh volume-highstandardization,commodity products

PRODUCT-PROCESS MATRIX (Figure 4.5)PRODUCT STRUCTURE (Product Life Cycle)

PR

OC

ES

S S

TR

UC

TU

RE (

Pro

cess L

ife C

ycle

)

IJumbled flow(job shop)

IIDisconnectedline flow(batch)

IIIConnectedline flow(assemblyline)

IVContinuousflow NONE

NONE

Product Life Cycle StagesLow volume-low standardization, one of a

kindMultiple products, low volumeFew major products, higher volumeHigh volume-high standardization,

commodity product