Process OM Analysis
Process any part of an organization that takes inputs and transforms them into outputs that are of greater value to the organization than original inputs. Output can be two things: o 1) Product hamburger o 2) Service healthy patient (doctors + patient) Cycle Time of a repetitive process is the average time between completions of successive units. Utilization the ratio of the time that a resource is actually activated relative to the time that it is available for use. Categorizing A Process: 1) Single stage vs. multi-stage 2) Make to stock vs. Make to order vs. Hybrid 3) Pacing vs. non-pacing Single-stage process Multi-stage process: 1) Buffering: refers to a storage area between stages where the output of a stage is placed prior to being used in a downstream stage. o Allows stages to operate independently. 2) Blocking: when activities in the stage must stop because there is no place to deposit the item just completed. 3) Starving: when activities in a stage must stop because there is no work. 4) Bottleneck: limits the capacity of the process. Make-to-order process: Activated only in response to an actual order.
Inventory (WIP and Finished Goods) is kept to a minimum. Response time is slow. Wendys
Make-to-stock process: Produces standard outputs that can be delivered quickly to customer. Ends with Finished Goods inventory. Target stocking level might be set. Used when demand is seasonal. McDonalds Old Process Hybrid Process: Combines features of make-to-order and make-to-process. Parallel at alternatives the end of the process. Burger King McDonalds New process Pacing refers to the fixed timing of the movement of items through the process. Measuring Process Performance: Benchmarking comparing metrics of one company to another is an important activity. Tell a firm if progress is being made toward improvement. Utilization is most common process metric ratio of the time that a resource is actually being used relative to the time that it is available for use.
Productivity vs. Utilization Productivity ratio of output to input. Total factor productivity is usually measured in $$$ Partial factor productivity measured based on an individual input, labor being the most common. Utilization measures the actual activation of the resource. Efficiency ratio of the actual output of a process relative to some standard. Used to measure loss or gain of a process. Run Time time required to produce a batch of parts. (Time required to produce each unit X batch size) Setup Time time required to prepare a machine to make a particular item. Operation Time Setup Time + Run Time Throughput Time average time for a unit to move through the system Process Velocity (throughput ratio) throughput time / value-added time Cycle Time average time between completion of units Throughput rate 1 / cycle-time Efficiency actual output / standard output Productivity output / input Utilization time activated / time available Littles Law Throughput time = (WIP / Throughput rate)
22/01/2008 00:40:00
22/01/2008 00:40:00