business notes

business notes - given that no resource can achieve a...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
18:53 2.2 process capacity – how much something can supply in total over a given unit of time the overall process capacity is determined by the resource with the smallest capacity (bottleneck) flow rate – minimum demand constrained – if the demand is lower than supply, the process would produce at the rate of demand, independent of the process capacity supply constrained – if demand exceeds supply 2.3 time to fulfill x units = x/flow rate 2.4 process utilization = flow rate/process capacity why a process might not produce at 100% utilization if demand is less than supply if there is insufficient supply of the input of a process if one or several process steps only have a limited availability bottleneck is the resource with the highest utilization objective of most businesses is to maximize profit, not to maximize utilization
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: given that no resource can achieve a higher utilization than the bottleneck, every process step other than the bottleneck will have a utilization gap relative to the bottleneck process might not always be capacity-constrained, but rather be input or demand constrained (disappears if there is sufficient market demand and full resource availability 2.5 utilization can never exceed 100% implied capacity = capacity requested by demand/available capacity implied capacity over 100% reflects that a resource does not have the capacity available to meet demand over 100% does not make it a bottleneck 2.6 product mix different types of customers flowing through one process work load requested capacity of a resource implied capacity busiest resource...
View Full Document

Page1 / 2

business notes - given that no resource can achieve a...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online