midterm 1 cheat sheet

# midterm 1 cheat sheet - Bottleneck = slowest resource...

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Bottleneck = slowest resource Utilization rate = Throughput Rate (capacity used) / capacity o Ex. Capacity of cashier = 96 customers per shift o Cashier’s throughput rate = 72 customers per shift o Capacity utilization = 72/96 = .75 (busy 75% of the time) o Utilization rate cannot be greater than 1 o As utilization increases (↑)waiting time will rise exponentially faster Ex. Utilization increases from .60 to .75 and waiting time has increased by 1.5 minutes and if utilization now increases from .75 to .90, the average total time will increase by more than 1.5 minute WIP inventory: # of units in a system at a point in time stored, waiting, or being processed Throughput Time: Average time a unit stays in the system LITTLES LAW: a rule that links various performance measures o Throughput Time = WIP/Throughput rate o Keeping WIP fixed, reducing throughput time results in a higher throughput rate o Roller coaster quiz example 50 people in front of you how long do you expect to wait? (The Throuput time of the

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## This note was uploaded on 02/15/2011 for the course BUAD 311 at USC.

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midterm 1 cheat sheet - Bottleneck = slowest resource...

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