1. OPSM 405 Service Operations Management
Koç University
OPSM 405 Service Operations Management
Class 17:
Wrap-up of process game
Process Analysis
Zeynep Aksin

2. Original process flowchartM M P C P M M C
Task times?
Bottleneck?
Resource utilization?
Cycle time? (Flow time)
Value adding time? (theoretical)

3. Terminology Flow Time (CT or T)
The flow time (also called variously throughput time, cycle time) of a given routing is the average time from release of a job at the beginning of the routing until it reaches an inventory point at the end of the routing.
Flow time 1 2 3 4

4. Terminology Throughput Rate (TH or R)
The average output of a production process per unit time. At the firm level, it is defined as the production per unit time that is sold. 1 2 3 4

5. Critical Path & Critical Activities
Critical Path: A path with the longest total cycle time.
Critical Activity: An activity on the critical path. A B D C

6. X-Ray Service Process 1. Patient walks to x-ray lab
2. X-ray request travels to lab by messenger
3. X-ray technician fills out standard form based on info. From physician
4. Receptionist receives insurance information, prepares and signs form, sends to insurer
5. Patient undresses in preparation of x-ray
6. Lab technician takes x-ray
7. Darkroom technician develops x-ray
8. Lab technician checks for clarity-rework if necessary
9. Patient puts on clothes, gets ready to leave lab
10. Patient walks back to physicians office
11. X-rays transferred to physician by messenger

7. Example: X-Ray 3 7 1 2 9 10 6 12 7 75% 4 5 6 7 8 start end 5 3 2 3 25%11 20 6 20
transport
support
Value added
decision
Measured actual flow time: 154 minutes

8. Consider all possible paths

9. Levers for Reducing Flow Time
Decrease the work content of critical activities
work smarter
work faster
do it right the first time
Move work content from critical to non-critical activities
to non-critical path or to ``outer loop’’
Reduce waiting time.

10. X-Ray revisited Resource Pool Res. Unit Load Load Batch
Theoretical Capacity of Res. unit
No of units in pool
Theoretical capacity of pool
Messenger
40 min/patient 1
1.5 patients/hr 6
9 Patient/hr
Receptionist 5 12
X-ray technician 16
3.75 4 15
X-ray lab
7.5 8 2
Darkroom technician 3
Darkroom
Changing room 10 20

11. Utilizations given an observed throughput of 5.5 patients/hr
Resource pool
Theoretical capacity
Patients/hr
Capacity utilization
Messenger 9
61.11
Receptionist 12
45.83
X-ray technician 15
36.67
X-ray lab 16
34.38
Darkroom technician
Darkroom 8
68.75
Changing room 20
27.50

12. Levers for Increasing Process Capacity
Decrease the work content of bottleneck activities
work smarter
work faster
do it right the first time
change product mix
Move work content from bottlenecks to non-bottlenecks
to non-critical resource or to third party
Increase Net Availability
work longer
increase scale (invest)
increase size of load batches
eliminate availability waste

13. Structuring The Service Enterprise
Example: Automobile’s Driver’s License Office
License Renewal Times
Activity Description Time (Sec)
1 Review application for correctness 15
2 Process and record payment 30
3 Check for violations and restrictions 60
4 Conduct eye test 40
5 Photograph applicant 20
6 Issue temporary license 30

14. Present Flow Diagram Flow time: sec Throughput rate: per hour
Activity
Activity
Activity 30
Activity
Activity 40
Activity 20 30 15 60
/hr
/hr
/hr
/hr
/hr
/hr
sec
sec
sec
sec
sec
sec
Flow time: sec
Throughput rate: per hour
What happens if you hire one more employee?
Activity
flow rate
per hour
time (sec)

15. Throughput rate: per hour
Proposed Flow Diagram
Activity
Activity 1, 55 60
/hr
/hr
sec
sec
Activity
Activity 30
Activity 20 30
/hr
/hr
/hr
sec
sec
sec
Activity
Activity 1, 55 60
/hr
/hr
sec
sec
Flow time: sec
Throughput rate: per hour

16. Throughput rate: per hour
Another Design
165
sec
/hr
Activity
165
sec
/hr
Activity
165
sec
/hr
Activity
Activity 30
/hr
165
sec
/hr
Activity
sec
165
sec
/hr
Activity
Flow time: sec
Throughput rate: per hour
165
sec
/hr
Activity

17. The role of task times: a balanced line
if task times are similar will have a balanced line
in the absence of variability (deterministic) complete synchronization is possible
in a balanced line idleness is minimized, though in the presence of variability full synchronization cannot be achieved

18. The role of task times: an unbalanced line
if average task times are different will have an unbalanced line
will have idleness
in unbalanced case, slowest task determines output rate
bottleneck is busy
idleness in other stages

19. The role of variability
6/hr
6/hr
4 or 8/hr
4 or 8/hr
2 or 10
2 or 10
0 or 12
0 or 12
As variability increases, throughput (rate) decreases

20. Compounding effect of variability and unbalanced task times
6/hr
4/hr
4/hr
3.5/hr
4 or 8/hr
2 or 6/hr
2 or 10
0 or 8
2.5/hr

21. Resource interaction effects
In a serial process downstream resources depend on upstream
resources: can have temporary starvation (idleness)
6/hr
6/hr
6/hr
6/hr
6/hr
6/hr
4 or 8/hr
4.5/hr
4 or 8/hr
4 or 8/hr
2 or 10
2 or 10
3/hr
6/hr
2 or 10
6/hr
0 or 12
0 or 12
1.5/hr
0 or 12
As variability increases, the impact of resource interaction increases

22. Want to eliminate as much variability as possible from your processes: how?
specialization in tasks can reduce task time variability
standardization of offer can reduce job type variability
automation of certain tasks
IT support: templates, prompts, etc.
incentives

23. Want to reduce resource interference in your processes: how?
smaller lotsizes (smaller batches)
better balanced line
by speeding-up bottleneck (adding staff, changing procedure, different incentives, change technology)
through cross-training
eliminate steps
buffers
integrate work (pooling)

24. The impact of task integration (pooling)
balances utilization...
reduces resource interference...
...therefore reduces the impact of temporary bottlenecks
there is more benefit from pooling in a high utilization and high variability process
pooling is beneficial as long as
it does not introduce excessive variability in a low variability system
the benefits exceed the task time reductions due to specialization

25. Examples of pooling in business
Consolidating back office work
Call centers
Single line versus separate queues

26. Summary of fundamental process principles
identify and eliminate bottlenecks
reduce as much variability as possible
eliminate handoffs, improve communication to minimize resource interference
for high utilization processes build-in more slack