311_session_6_little

311_session_6_little - Littles Law BUAD311 Operations...

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Little’s Law BUAD311 Operations Management Session 6 1
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2 Objectives Little’s Law A general rule that links various performance measures
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Measurement Capacity Flow Time (Throughput Time) Flow Rate (Throughput Rate) WIP 3
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Flow Rate (Throughput Rate) Flow Time (Throughput Time) WIP 4 What is the relationship? Time WIP Flow rate is two  unit per unit of time
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5 Flow Time = WIP / Flow Rate Little’s Law
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6 Little’s Law Example: Bank Teller (Average) WIP: 6 customers (Average) Flow rate: 12 customers per hour (Average) Flow time: 6/12 = 0.5 A customer spends (on average) 0.5 hours in the bank Does this mean each customer spends 0.5 hours in the bank? How many customers arrive on average in an hour? How many customers leave on average in an
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7 Implications of Little’s Law Given average WIP and Flow Rate, we can calculate Flow Time Relatively easy to measure WIP and Flow Rate Keeping WIP fixed, reducing Flow Time results in a higher Flow Rate.
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8 Implications of Little’s Law
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311_session_6_little - Littles Law BUAD311 Operations...

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