processselection&analysiss
DESCRIPTION
Process Selection, Design, and AnalysisTRANSCRIPT
1OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
PROCESS SELECTION, DESIGN, AND ANALYSIS
DAVID A. COLLIER AND JAMES R. EVANS
2OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISValue chain—a network of processes.
3OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Design – Four Levels of Work
• Task—a specific unit of work required to create an output.
• Activity—a group of tasks (sometimes called a workstation) needed to create and deliver an intermediate or final output.
• Process—a group of activities.
• Value chain—a network of processes.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Choice Decisions – Types of Goods and Services
- Examples include ships, weddings, certain jewelry, estate plans, buildings, and surgery.
• Custom, or make-to-order, goods and services are generally produced and delivered as one-of-a-kind or in small quantities, and are designed to meet specific customers’ specifications.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Choice Decisions – Types of Goods and Services
- Examples are Dell computers, Subway sandwiches, machine tools, and travel agent services.
• Option, or assemble-to-order, goods and services are configurations of standard parts, subassemblies, or services that can be selected by customers from a limited set.
6OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Choice Decisions – Types of Goods and Services
- Examples are appliances, shoes, sporting goods, credit cards, online Web-based courses, and bus service.
• Standard, or make-to-stock, goods and services are made according to a fixed design, and the customer has no options from which to choose.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Five Basic Processes
• Project• Job shop (craft production)• Batch• Repetitive / Assembly line (mass production) • Continuous flow
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Types• Project
–Non-routine, one of a kind.–Limited time frame–Ranging from simple to
complicated? Examples:
Making a motion picture, construction, a homework assignment.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Types• Job Shop (craft production)
– Operates on a relatively small scale– Low volume– High variety– Processing is intermittent– Skilled workers / general tools or
machines? Examples?Doctor’s office, Beauty shop, and Auto repair.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Types• Batch
–Moderate volume–moderate variety–Processing is intermittent–General equipment and skilled
workers? Examples?
Bakeries, Movie theaters, Airlines, and Schools
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Types• Repetitive Manufacturing / Assembly
(mass production)–High volume–Standardized product–Specialized equipment –Do not need skilled workers? Examples?
Production lines and assembly lines: TV sets, pencils, and computers.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Types• Continuous flow
– Very high volume– Highly standardized product/no
variety– Special equipment with no
flexibility– Do not need skilled workers? Examples?
Petroleum products, steel, sugar, flour, salt, electricity, and the Internet!
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Selection TheoryFactors to be considered: Variety in products
Sugar Vs. Precious Jewelry
Expected volume of demand for each kind Sugar Vs. Spaceship
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Variety, Flexibility, & VolumeProductVariety
High Moderate Low Very Low
Equipmentflexibility
High Moderate Low Very Low
LowVolume
ModerateVolume
HighVolume
Very highVolume
JobShopJob Shop
Batch
Repetitiveassembly
ContinuousFlow
16OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Product-Process Matrix
Flexibility-Quality Dependability-Cost
ContinuousFlow
AssemblyLine
Batch
JobShop
LowVolumeOne of aKind
MultipleProducts,LowVolume
FewMajorProducts,HigherVolume
HighVolume,HighStandard-ization
BeautyShop
Schools
TVAssembly
SugarRefinery
Flexibility-Quality
DependabilityCost
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Type?
Why?
• Super market?
• Coca-cola?
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process Type of Meatrix?
Don’t know what the MEATRIX is? Know Movie “the Matrix”?Let’s see together.http://www.themeatrix1.com/
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Flexibility-Quality Dependability-Cost
ContinuousFlow
Repetitive Manufacturing
Batch
JobShop
LowVolumeOne of aKind
MultipleProducts,LowVolume
FewMajorProducts,HigherVolume
HighVolume,HighStandard-ization
Factory Farming
Flexibility-Quality
DependabilityCost
The MEATRIX
Family Farming
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Flexibility-Quality Dependability-Cost
ContinuousFlow
AssemblyLine
Batch
JobShop
LowVolumeOne of aKind
MultipleProducts,LowVolume
FewMajorProducts,HigherVolume
HighVolume,HighStandard-ization
Flexibility-Quality
DependabilityCost
This is the whole meaning of Industry Revolution and scientific and decisional
management.
Emerging of New Industry!
More efficient production!
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
The Incentive for New Revolution
• At first, Ford’s Model T had only one color: black• The black western electric desk telephone went
almost unchanged for 40 years.The long setup/changeover time of the assembly line
makes it hard to produce a variety of products.
The increasingly diversified customer demand.
22OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISThe Modern Production Systems:Breaking Down the Diagonal!
• Lean Production
Flexibility-Quality Dependability-Cost
ContinuousFlow
AssemblyLine
Batch
JobShop
LowVolumeOne of aKind
MultipleProducts,LowVolume
FewMajorProducts,HigherVolume
HighVolume,HighStandard-ization
BeautyShop
Schools
AutomobileAssembly
SugarRefinery
Flexibility-Quality
DependabilityCost
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Lean Production
• Using assembly lines to efficiently produce a variety of products to satisfy diversified customer demand at a “sweet “ price.– Reduce setup time– Flexible machine– Information Management
• We will revisit the issue later
24OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISThe Modern Production Systems:Breaking Down the Diagonal!
• Mass Customization
Flexibility-Quality Dependability-Cost
ContinuousFlow
AssemblyLine
Batch
JobShop
LowVolumeOne of aKind
MultipleProducts,LowVolume
FewMajorProducts,HigherVolume
HighVolume,HighStandard-ization
Tailor’s
Schools
Clothes
SugarRefinery
Flexibility-Quality
DependabilityCost
Tailored Suits
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Mass Customization
Dell
Levi Straus “Personal Pair” women’s jeans Customer measurements are entered at the POS
(point of sale) measurements sent to Tennessee factory 300% increase in sales and a corresponding
reduction in inventory.
“Pioneered in Jeans, Customization Spreads to Shoes and Fragrances,”The Christian Science Monitor, 12/30/96
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFive basic process types• Project• Job Shop• Batch• Repetitive / Assembly• Continuous flow
Trade off between efficiency and variety
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISObtain both efficiency and variety!
• Lean Production
• Mass Customization
Combineefficiency and variety
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
The Service-Positioning Matrix• In the product-process matrix, product volume, the
number of products, and the degree of standardization/customization determine the manufacturing process that should be used. This relationship between volume and process is not found in many service businesses.
• The Service-Positioning Matrix is similar to the product-process matrix in that it suggests that the nature of the customer’s desired service encounter activity sequence should lead to the most appropriate service system design and that superior performance results by generally staying along the diagonal of the matrix.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
The Service-Positioning Matrix• A pathway is a unique route through a
service system. Pathways can be customer- or provider-driven, depending on the level of control that the service firm wants to ensure.
• The service encounter activity sequence consists of all the process steps and associated service encounters necessary to complete a service transaction and fulfill customer’s wants and needs.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Source: Adapted from D. A. Collier and S. M. Meyer, “A Service Positioning Matrix,” International Journal of Production and Operations Management, 18, no. 12, 1998, pp. 1123–1244. Also see D. A. Collier and S. Meyer, “An Empirical Comparison of Service Matrices,” International Journal of Operations and Production Management, 2000 (no. 5–6), pp. 705–729.
Exhibit 7.3
The Service Positioning Matrix
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
The Service-Positioning Matrix• Customer-routed services are those
that offer customers broad freedom to select the pathways that are best suited for their immediate needs and wants, from many possible pathways through the service delivery system. - Examples include searching the
Internet, museums, health clubs, and amusement parks.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
The Service-Positioning Matrix• Provider-routed services constrain
customers to follow a very small number of possible and predefined pathways through the service system. - Examples are a newspaper dispenser
and logging on to a secure online bank account.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout
Facility layout refers to the specific arrangement of physical facilities. Facility-layout studies are necessary whenever: 1. a new facility is constructed, 2. there is a significant change in demand
or throughput volume, 3. a new good or service is introduced to
the customer benefit package, or 4. different processes, equipment, and/or
technology are installed.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout
Purposes of layout studies are to: • minimize delays in materials handling and
customer movement.• maintain flexibility. • use labor and space effectively.• promote high employee morale and
customer satisfaction.• provide for good housekeeping and
maintenance.• enhance sales as appropriate in
manufacturing and service facilities.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout • A product layout is an arrangement
based on the sequence of operations that are performed during the manufacturing of a good or delivery of a service.
• Examples: Winemaking industry, credit card processing, Subway sandwich shops, paper manufacturers, insurance policy processing, and automobile assembly lines.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 8.1 Product Layout for Wine Manufacturer
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout
Product Layout• Advantages: Lower work-in-process
inventories, shorter processing times, less material handling, lower labor skills, and simple planning and control systems.
• Disadvantages: A breakdown at one workstation can cause the entire process to shut down; a change in product design or the introduction of new products may require major changes in the layout, limiting flexibility.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout • A process layout consists of a functional
grouping of equipment or activities that do similar work.
• Examples: Legal offices, shoe manufacturing, jet engine turbine blades, and hospitals use a process layout.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 8.2 Process Layout for a Machine Shop
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout
Process Layout• Advantages: A lower investment in
equipment, the diversity of jobs inherent in a process layout can lead to increased worker satisfaction.
• Disadvantages: High movement and transportation costs, more complicated planning and control systems, longer total processing time, higher in-process inventory or waiting time, and higher worker-skill requirements.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout • In a cellular layout, the design is not
according to the functional characteristics of equipment, but rather by self-contained groups of equipment (called cells), needed for producing a particular set of goods or services.
• Examples: Legal services, such as labor law, bankruptcy, divorce; medical specialties such as maternity, oncology, surgery.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Source: J. T. Black, “Cellular Manufacturing Systems Reduce Set Up time, Make Small-Lot Production Economical,” Industrial Engineering Magazine, Nov. 1983. Used with permission from the author.
Exhibit 8.3 Cellular Manufacturing Layout
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout
Cellular Layout• Advantages: Reduced materials-handling
requirements, quicker response to quality problems, more efficient use of floor space, more worker responsibility increasing morale.
• Disadvantages: Duplication of equipment among cells, greater worker skills requirements.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Facility Layout• A fixed-position layout consolidates the
resources necessary to manufacture a good or deliver a service, such as people, materials, and equipment, in one physical location.
• Examples: The production of large items such as heavy machine tools, airplanes, buildings, locomotives, and ships. Service-providing examples include major hardware and software installations, sporting events, and concerts.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Fixed-Position Layout
• Advantages: Work remains stationary, reducing movement.
• Disadvantages: High level of planning and control required.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 8.4 Comparison of Basic Layout Patterns
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISType of Layouts• Process Layouts• Product Layouts• Cellular Layouts• Fixed Position Layouts
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Content Can Be Found• PPT on Blackboard• Book Chapter 7 section 1 about three types
of products / services (custom, option, and standard), skip process type part.
• Book Chapter 7 section 3• Book Chapter 8 Section 1
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process and Value Stream Mapping• A process map (flowchart) describes the
sequence of all process activities and tasks necessary to create and deliver a desired output or outcome. - Process maps document how work either is, or
should be, accomplished, and how the transformation process creates value.
• A process boundary is the beginning or end of a process. - Makes it easier to obtain management
support, assign process ownership, and identify where performance measures should be taken.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 7.4 The Hierarchy of Work and Cascading Flowcharts for Antacid Tablets
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process and Value Stream Mapping• In service applications, flowcharts generally
highlight the points of contact with the customer and are often called service blueprints or service maps.
• Such flowcharts often show the separation between the back office and the front office with a “line of customer visibility.”
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process and Value Stream Mapping• The value stream refers to all value-added
activities involved in designing, producing, and delivering goods and services to customers.
• A value stream map (VSM) shows the process flows in a manner similar to an ordinary process map; however, the difference lies in that value stream maps highlight value-added versus non-value-added activities and include costs associated with work activities for both value- and non-value-added activities.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Flowchart• A rectangle denotes a task or work activity.• A triangle indicates waiting or inventory• An oval denotes the “start” or “end” • An arrow denotes movement, transfer, and flow to the next
task or activity• A double headed arrow denotes an input or arrival into a
process• A diamond denotes a decision that might result in taking
alternative paths. • Line of customer visibility.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 7.5
Automobile Repair Flowchart
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Process and Value Stream Mapping
Examples of non-value-added activities include:
• Transferring materials between two nonadjacent workstations
• Overproducing• Waiting for service or work to do • Not doing work correctly the first time• Requiring multiple approvals for a low cost
electronic transaction
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 7.6 Restaurant Order Posting and Fulfillment Process
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Exhibit 7.7
Value Stream Map for Restaurant Order Posting and Fulfillment Process
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISThree basic measures of a process
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISProductivity
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISCapacity
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Utilization
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
Break into groups of 3. Each people performs one of the 3 operations above. Use sticky pads and draw with pencils.
When time is called, write down how many cards are in each operation and each inventory area except RMI.
Raw Material Inv.
Work-in-process Finished
goods Inv.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
One P-POINT for the winning team!
Quality Matters: Don’t count the defective ones.
67OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
Card Counts: 1 24 1 0 1 14
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
InputsOutputs
tyProductivi
Productivity Defined
• Inputs: labor, materials, capital, …• Outputs: goods, services
Productivity: a measure of the effective use of resources, usually expressed as the ratio of output to input.
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CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFactor Productivity Measures• Partial productivity (a single input)• Multifactor productivity (more than one input)• Total productivity (all inputs)
…Calculation depends on units used: – Units of output per labor hour– Units of output per dollar spent– Sales ($) per dollar spent
70OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
Card Counts: 1 24 1 0 1 14
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
Productivity of the group: How many faces per person minute?
14 faces in 2 minutes by 3 persons Productivity = output / input = 14 faces / ( 3 *2 minutes) = 2.33 faces/ minute
71OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISCapacityThe upper limit or ceiling on the load that an operating unit can handle.
• No downtime• No maintenance• No breakdown• As fast as possible
72OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Capacity
Card Counts: 1 24 1 0 1 14
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
How many parts did OP1, OP2, and OP3 finish?
OP1: 24+1+1+14=40
OP3: 14
OP2: 1+14=15
73OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
Card Counts: 1 24 1 0 1 14
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
How long it takes each person to do a face?
OP1: 120/40=3 secOP3: ?? Can’t say because of idle time. Let’s assume it is 5 sec for the later analysis
OP2: (120-3)/15 =8 sec
74OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
Card Counts: 1 24 1 0 1 14
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
Bottleneck? The slowest person/equipment that determines the system capacity.
Bottleneck: Second person
75OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Capacity
CT: 3 8 5
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
Capacity of each person?
OP1: 3 sec to finish a job, capacity: 20 circles/minuteOP2: 8 sec to finish a job, capacity: 60/8= 7.5 jobs/minuteOP3: 5 sec to finish a job, capacity: 60/5=12 jobs/minute
76OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Capacity
CT: 3 8 5
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
Capacity of the system/group?
OP2: 8 sec to finish a job, capacity: 60/8= 7.5 jobs/minute
77OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISUtilization Analysis
• UtilizationThe percentage of time of a single person or
machine working on the product or on performing the service.
= Working Time / Total Available Time = Actual output per unit time / Capacity
78OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
CT: 3 8 5
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
Utilization of OP1? OP2? OP3?OP1: Output: 40 in 2 minutes. Utilization=Output rate/capacity=20/20=100%OP2: Output: 15 in 2 minutes. Utilization=Output rate/capacity=7.5/7.5=100%
OP3: Output: 14 in 2 minutes. Utilization=Output rate/capacity=7/12=58.3%
79OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
CT: 3 8 5
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
The average utilization of the group?
System average utilization: (100%+100%+58.3%)/3=86.1%
80OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISFace Game: Example
• How to improve the efficiency of the face drawing process? – Balance the line– Flexible process: people take all the tasks and
they work in parallel.
WIP2
WIP1
RMI
FGI
OP 1 OP 2 OP 3
81OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISMore examples: Productivity• Partial productivity
Output LaborPeriod 1 1000 units 100 hrsPeriod 2 1100 105
Productivity10.0 units / hour10.5 units / hour
How many units we can make per labor hour?
82OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISCalculating Productivity
A company produces 10,000 UnitsUnits are Sold for $10/unitLabor used 500 labor hoursLabor rate $9/hrEnergy $5,000Raw Material: $25,000
Labor Productivity (unit/hour): Total Productivity(Sales($)/$:)
10,000 Units / 500 hours = 20 units/hr
$10/unit * 10,000 Units ‘ $5000 + $25,000 + ($9/hour * 500 hours)= $100,000/$34,500 = 2.899
83OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSISUtilization• If we determine that the capacity of an employee is 25 units/hour, labor utilization of any worker? Assuming all workers are working at the same utilization.
Utilization = output rate / capacity = 20/25 =80%
84OM3 Chapter 7 Process Selection, Design, and Analysis© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 7 PROCESS SELECTION, DESIGN, AND ANALYSIS
Where to find content• PPT on Blackboard• Book Chapter 7 section 4 and 5