MBA 8452 Systems and Operations Management

1. MBA 8452 Systems and Operations Management Process Analysis

2. Process Analysis Process Analysis Process Analysis Flow charting Types of Processes Process Performance Job Design Work Measurements Incentive Plans

3. What Is A Process? • Process is the basic building block of an operations/production system • A process is a collection of activities that transforms inputs into outputs that are valuable to the customer

4. Process Flowchart • Diagram showing the major elements of a process and their interconnections • tasks or operations • flows of materials or customers • storage areas or queues.

5. Process FlowchartSymbols Storage areas or queues Tasks or operations Flows of materials or customers Decision Points

6. Customer order 1. McDonald’s Finished burgers Finished burgers Chili Raw material Cook Assemble Deliver 2. Burger King Assemble C Custom or Standard? Raw material WIP Cook S Customer order Deliver Customer order 3. Wendy’s Assemble Deliver Raw material Cook Assemble Process FlowchartExamples: Hamburger Making Process

7. Stage 1 Stage 1 Stage 2 Stage 3 Types of Processes • Single-stage vs. Multistage Single-stage Process Multistage Process

8. Buffer Stage 1 Stage 2 Bottleneck Types of ProcessMultistage Process with Buffer • What might happen without buffer? • Blocking • Starving

9. Customer order Finished goods Make Deliver Deliver Make Customer order Types of ProcessMake-to-stock vs. Make-to-order Make-to-stock Process Make-to-order Process

10. 1 Cycle time Throughput time Value-added time “You can not improve something you can’t measure”Process Performance Metrics • Operation time= Setup time + Run time • Throughput time= Average time for a unit to move through the system • Cycle time=Average time between completion of units • Throughput rate= • Velocity (throughput ratio)=

11. Time activated Output Input Time available Actual output Standard output “You can not improve something you can’t measure” Process Performance Metrics (cont.) • Efficiency= • Productivity= • Utilization=

12. Little’s Law Work-in-process Throughput time= Throughput rate

13. 5 min/unit 8 min/unit 3 min/unit Stage 1 Stage 2 Stage 3 Process Performance MetricsExample 1 Cycle time = 8 minutes Throughput rate = 60 units/day Throughput time = 19 minutes (Assume 8-hour working day)

14. 5 min/unit 8 min/unit 3 min/unit Buffer Stage 1 Stage 2 Stage 3 Process Performance MetricsExample 2 Cycle time = 8 min Throughput rate = 60 units/day Throughput time = 5 + 144 + 8 + 3 = 160 min (Assume 8-hour working day)

15. Process Throughput Time Reduction • Perform activities in parallel • Change the sequence of activities • Reduce interruptions