3 EO - 702 EMBA-2, BUP M. ASAD Process capacity - of the process is its maximum output rate, measured in units produced per unit of time. The capacity of a series of tasks is determined by the lowest capacity task in the string. Capacity utilization - the percentage of the process capacity that actually is being used. Cycle time - the time between successive units as they are output from the process. Idle time - time when no activity is being performed. Process Analysis Terms
4 EO - 702 EMBA-2, BUP M. ASAD Process Analysis Process analysis generally involves the fol tasks: Define the process boundaries Construct a process flow diagram Determine the capacity of each step Identify the bottleneck Evaluate further limitations Analyze, make decisions and to improve process. Process Flowcharting Process flowcharting is the use of a diagram to present the major elements of a process
5 EO - 702 EMBA-2, BUP M. ASAD Other Types of Processes Make-to-order -Only activated in response to an actual order. Here both work-in-process and finished goods inventory kept to a minimum Make-to-stock-Process activated to meet expected or forecast demand, Here, customer orders are served from target stocking level Hybrid -Combines the feature of both make-to-order and make-to-stock.
6 EO - 702 EMBA-2, BUP M. ASAD Other Types of Processes
7 EO - 702 EMBA-2, BUP M. ASAD Types of Processes 1.Single-stage Process – 2.Multi-stage Process – Blocking - occurs when an activity becomes idle because the next downstream activity is not ready to take it. Starvation - occurs when a downstream activity is idle with no inputs to process because of upstream delays. Both starvation and blocking can be reduced by adding buffers that hold inventory between activities. Buffer- refers to a storage area between stages where the output of a stage is placed prior to being used in a downstream stage Bottleneck -occurs when the limited capacity of a process causes work to pile up or become unevenly distributed in the flow of a process
8 EO - 702 EMBA-2, BUP M. ASAD Measuring Process Performance Setup time: The time required to prepare the equipment to perform an activity on a batch of units. Set-up time can be reduced on a per unit basis by increasing the batch size. Run time : Time require to produce a batch of parts. Operation time = Setup time + Run time Throughput time ( or Flow time or lead time) - the average time that a unit requires to flow through the process from the entry point to the exit point. The flow time is the length of the longest path through the process. Throughput rate (also known as flow rate ) - the average rate at which units flow past a specific point in the process. The maximum throughput rate is the process capacity.
9 EO - 702 EMBA-2, BUP M. ASAD Measuring Process Performance Throughput rate = 1 / cycle time Pacing -Refers to the fixed timing of the movement of items through the process Value-added time – The time in which useful work is actually being done on the unit. Process Velocity or Throughput Ratio = Throughput time / Value-added time
10 EO - 702 EMBA-2, BUP M. ASAD Measuring Process Performance Littles Law Throughput time = WIP / Throughput Rate Estimates a mathematical relationship between Throughput rate, Throughput time and amount of work in process (WIP) inventory. Assumption : process is operating at steady rate. Usefulness : help to diagnosis the performance of process.
11 EO - 702 EMBA-2, BUP M. ASAD Process Improvement Improvements in cost, quality, flexibility, and speed are commonly sought. Add additional resources to increase capacity of the bottleneck. Improve the efficiency of the bottleneck activity Minimize non-value adding activities - decreases cost, reduces lead time. Change the sequence of activities. Redesign the product for better manufacturability - can improve several or all process performance measures. Flexibility can be improved by outsourcing certain activities.
12 EO - 702 EMBA-2, BUP M. ASAD Midterm-1 On Next Saturday 20 Feb 2010 At 0630 p.m.