DAO2703 OTM

Week 3
Process Analysis

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 Course Structure
Introduction to OTM;
Managing the Overview
Transformation Process

Process Types; Advanced Recognizing

Operations Technologies;
Process Analysis the Plant
Aggregate
Production Planning

Planning for
Inventory Material Require-
the Plant;
Management ments Planning
PP&C Cycle
Operations Waiting Line
Scheduling Management

Quality Improving the

Lean Operations
Management Plant
Operations Strategic
Strategies Considerations
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 Process Analysis
A process is any part of an organization that takes inputs and
transforms them into outputs ideally of greater value to the
organization than the original inputs
A single-stage process: all the activities could be collapsed and
analyzed using a single cycle time to represent the speed of the
process

Process

A multiple-stage process: one that has multiple groups of activities that

are linked through flows

Stage 1 Stage 2 Stage 3

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 Process Analysis: Capacity
Nova Cruz, Inc. is a producer of high-end kick
scooter, known as the Xootr
Components
Finished
Stage 1 Stage 2 Stage 3 Goods

13 minutes 11 minutes 8 minutes

Flow unit: the basic unit of analysis considered in

process analysis (Xootr, customer, patient, etc.)
Activity/process time at each stage/station/step:
amount of time spent on the activity/process,
including changeover/setup and run time
Process capacity: the maximum number of flow
units (Xootrs) that move through the process in a
given unit of time
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 Process Analysis: Resource Capacity
Components
Finished
Stage 1 Stage 2 Stage 3 Goods

13 minutes 11 minutes 8 minutes

Resource: the entity (stage/station/step) of a process that the flow unit (Xootr) has
to visit as part of its transformation from input to output
Resource capacity: the number of flow units (Xootrs) that move through each
stage/station/step in a given unit of time
Stage 1: 1 unit/13 mins = 0.077 units/min
Stage 2: 1 unit/11 mins = 0.091 units/min
Stage 3: 1 unit/8 mins = 0.125 units/min
min. capacity, it
Process capacity = min(Resource capacity 1, …, Resource capacity n)
takes longest Process capacity = min(0.077, 0.091, 0.125) units/min = 0.077 units/min (or 4.62 units/hr)
time Resource with the lowest capacity (i.e., Stage 1) is the bottleneck that decides the
process capacity
Bottleneck: the resource with the lowest capacity and thus limits the capacity of the
process
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 Process Analysis: Bottleneck
Starving occurs when the activities in a resource must stop because there
is no work
stage 2 need to wait 2 min everytime complete its work.

Stage 1 Stage 2 Stage 3

13 minutes 11 minutes 8 minutes

Which stage(s) is(are) “starved?”

2 and 3
Blocking occurs when the activities in a resource must stop because there
is no place (if no buffer is available) to deposit the item just completed

Stage 1 Stage 2 Stage 3

140 minutes 180 minutes 120 minutes
stage 3 starved by stage 2
stage 1 blocked by stage 2
Which stage(s) is(are) “blocked” or “starved?”
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 Process Analysis: Flow Rate
Components
Finished
Stage 1 Stage 2 Stage 3 Goods

13 minutes 11 minutes 8 minutes

Flow Rate (FR), also known as throughput: the number of flow units that
move through the process in a given unit of time
FR = min(process capacity, demand) assuming sufficient supply of inputs
If demand ≥ process capacity, production would be set to run at full speed
FR = process capacity (1 unit/13 mins = 0.077 units/min)
The process is process-constrained (or process-controlled)
If demand < process capacity, production would be set to run at the speed of
demand
FR = demand rate (< 0.077 units/min)
The process is demand-constrained (or demand-controlled)

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 Process Analysis: Cycle Time
Steady state: A process is said to be at steady state when it is not
affected by either the start-up, changeover, or the shut-down activities

Stage 1 Stage 2 Stage 3

2 minutes 2 minutes 2 minutes

Process capacity = 1 unit/2 mins (or 0.5 units/min), and if it is process-

constrained, FR = 0.5 units/min?
Not for the first 6 minutes at the start of the workday (the process has just started)
Not the last 6 minutes (or more) before the end of the workday
Other than the above, the process is at steady state, and thus it does produce one
flow unit in every 2 minutes
Cycle time (CT): the time between the completion of successive flow
units at steady state
1
CT =
FR
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 Process Analysis: Flow Time
Flow time (FT): the time a flow unit spends in the process, which
includes the time it is worked on at various resources as well as any
time it spends in the Work in process (WIP) inventory
What are the FT’s of the following processes (assuming process-constrained)?
Stage 1 Stage 2 Stage 3
5 minutes 4 minutes 3 minutes

Stage 1 Stage 2 Stage 3

5 minutes 5 minutes 5 minutes

Stage 1 Stage 2 Stage 3

5 minutes 3 minutes 4 minutes

Stage 1 Stage 2 Stage 3

4 minutes 3 minutes 5 minutes
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 Process Analysis: Gantt Chart
Gantt chart: a graphical way to illustrate the durations of activities as
well as potential dependencies between them

Stage 1 Stage 2 Stage 3 sum of process time

4 minutes 3 minutes
12min
5 minutes

Activity

Stage 1
Stage 2
Stage 3

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Time

Unit 1 Unit 2 Unit 3

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 Process Analysis: Gantt Chart
Stage 1 Stage 2 Stage 3
4 minutes 3 minutes 5 minutes

4+3 + 5+ 2=14
Activity

Stage 1
Stage 2
Stage 3

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 Time

Unit 1 Unit 2 Unit 3 Unit 4 Unit 5

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 Process Analysis: Capacity Utilization
Capacity utilization: the extent to which a resource/process uses its
capacity when supporting a given flow rate
FR
Process capacity utilization =
Process capacity
FR
Resource capacity utilization =
Resource capacity
Components
Finished
Stage 1 Stage 2 Stage 3 Goods

13 minutes 11 minutes 8 minutes

If process-constrained, FR = process capacity and thus process capacity utilization

is 100%
Resource capacity utilization of Stage 1 = 1/13 / 1/13= 100% stage 1 is bottleneck. just need to keep w
Resource capacity utilization of Stage 2 = 1/13 / 1/11= 84.62%
Resource capacity utilization of Stage 3 = 1/13 / 1/8= 61.54%
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 Process Analysis: Capacity Utilization
Capacity utilizations of other resources (with assumptions):

Components
Finished
Stage 1 Stage 2 Stage 3 Goods

13 minutes 11 minutes 8 minutes

13+11+8 min/unit
Labor content
Labor utilization = = / = 82.05%
Labor content+Total Idle Time (13+11+8)+ (0+2+5) min/unit
Machine utilization =
Implications:
Available labor and equipment are not utilized efficiently
Fairness issues may arise since some employees work harder than others
The process is not completely balanced (or synchronized)

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 Improvement Using Line Balancing
Time Components Finished
Task Activity Stage 1 Stage 2 Stage 3 Goods
(secs)
1 Prepare Cable 32
2 Move Cable 25 13 minutes 11 minutes 8 minutes
3 Assemble Washer 100
4 Apply Fork, Threading Cable End 66 Before Line Balancing
13 minutes • FR = 0.077 units/min
5 Assemble Socket Head Screws 114
11 minutes • CT = 13 mins
6 Steer Pin Nut 49 • Resource Utilization:
7 Brake Shoes, Spring, Pivot Bolt 66 • Stage 1 = 100%
8 Insert Front Wheel 100 8 minutes
• Stage 2 = 84.62%
9 Insert Axle Bolt 30 • Stage 3 = 61.54%
10 Tighten Axle Bolt 43
11 Tighten Brake Pivot Bolt 51
12 Assemble Handle and Cap 118
13 Assemble Brake Lever and Cable 110
14 Trim and Cap Cable 59 Stage 1 Stage 2 Stage 3
15 Place First Rib 33
After Line Balancing
16 Insert Axles and Cleats 96
• FR = 0.091 units/min
17 Insert Rear Wheel 135
11 minutes • CT = 11 mins
18 Place Second Rib and Deck 84 11 minutes 10 minutes • Resource Utilization:
19 Apply Grid Tape 56
• Stage 1 = 100%
20 Insert Deck Fasteners 75
• Stage 2 = 90.91%
21 Inspect and Wipe Off 95 • Stage 3 = 100%
22 Apply Decal and Sticker 20
23 Insert in Bag 43
24 Assemble Carton 114
25 Insert Xootr and Manual 94
26 Seal Carton 84 Stage 1 Stage 2 Stage 3
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 Line Balancing: Heuristic 1
Incremental utilization heuristic (demand-constrained):
1
Set FR = demand, then determine CT = 𝐹𝑅 Text
Total activity time (𝑇𝐴)
Determine the number of stages required, n = 𝐶𝑇
Arrange the tasks to each stage (by trial and error) to maximize each stage’s
resource utilization
Xootr example: suppose that demand = 0.06 units/min (< process capacity)
1 1
FR = demand = 0.06 units/min; CT = = = 1000 seconds/unit
𝐹𝑅 0.06 units/min
Total activity time (𝑇𝐴) 1892 seconds
n= = = 1.892 ≈ 2 (round up to next higher integer)
𝐶𝑇 1000 seconds/unit
Arrange the tasks to each of the two stages (by trial and error), we get

Components Finished
Stage 1 Stage 2
Goods
(Tasks 1 – 14) (Tasks 15 – 26)

963 seconds 929 seconds

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 Line Balancing: Heuristic 2
Longest activity time heuristic (process-constrained):
Set CT = longest activity time among all activities
Total activity time (𝑇𝐴)
Determine the number of stages required, n = 𝐶𝑇
Arrange the tasks to each stage (by trial and error) to maximize each stage’s
resource utilization
Xootr example: suppose that demand > process capacity = 0.077 units/min
CT = 135 seconds/unit
Total activity time (𝑇𝐴) 1892 seconds
n= = = 14.0148 ≈ 15
𝐶𝑇 135 seconds/unit
By trial and error, 19 stages are required in order for CT to be not more than 135
seconds at each stage

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 Improvement Using Batch Production
Components Finished
Stage 1 Stage 2 Goods

Setup time = 8 minutes No setup is required

Runtime = 2 minutes Runtime = 3 minutes

Non-batch production: Batch production (batch size, Q = 8):

8 1
Stage 1 is the bottleneck Process capacity = = units/min
1 8+ 8×2 3
Process capacity = = 0.1 units/min same batch..
Resource capacity at Stage 1 =
1
units/min
8+2
make the speed the same 3
FT = (8 + 2 + 3) = 13 minutes (per unit) Resource capacity at Stage 2 =
1
units/min
3
Assuming process-constrained Line is (perfectly) balanced
FR = process capacity = 0.1 units/min FT = (24 + 24) = 48 minutes (per batch)
1 1
CT = = = 10 minutes/unit Assuming process-constrained
𝐹𝑅 0.1
1
FR = process capacity = units/min
3
1
© Copyright National University of Singapore. All Rights Reserved. CT = = 3 minutes/unit (24 minutes/batch)
𝐹𝑅
 Process Analysis: Buffer & Inventory
Inventory: the (average) number of flow units that are in the process (WIPs)
Buffer: a storage area between stages where the output of a stage is
placed prior to being used in a downstream stage (another word for
inventory, which is used if the role of buffer is to maintain a certain level of
flow rate (throughput)

Components
Finished
Stage 1 WIP WIP Goods
Stage 2 Stage 3

13 minutes 15 minutes 8 minutes

A buffer would have to contain enough flow units to avoid starvation of the
downstream resource
It should have enough space to prevent the upstream resource from being
blocked
Buffers help to improve the flow rate (throughput)
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 Process Analysis: Little’s Law
Little’s Law: when a process is at steady state,
Inventory = Flow Rate × Flow Time (i.e., I = FR × FT)
Xootr example:
Components
Finished
Stage 1 Stage 2 Stage 3 Goods

13 minutes 11 minutes 8 minutes

FR= 1/13 unit/min FT= 32min, assuming process-constratined (average ) inventory

I= FR x FT = 1/ 13 units/min x 32min = 2.46units

Implication:
Out of the three fundamental process performance measures (inventory, flow rate,
and flow time), two can be chosen by management, the other is GIVEN by the Little’s
Law (nature)
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 Process Analysis: Batch Production
Components Finished
Stage 1 WIP Stage 2 Goods

Setup time = 8 minutes No setup is required

Runtime = 2 minutes Runtime = 3 minutes

Non-batch production: Inventory Resource capacity at Stage 1

Resource capacity at Stage 2 Process capacity
I = FR × FT = 0.1 × 13 = 1.3 units
0.50 100
Batch production (Q = 8): 0.45 90
1 0.40 80
I = FR × FT = × 48 = 2 batches (or 16 units) 0.35 70
24

Invenotry
Capacity
0.30 (8, 0.3333) 60
Why choose a batch of size, Q = 8? 0.25 50
0.20 40
Q > 8, same process capacity; higher inventory 0.15 30
Q<8 lower process capacity, lower inventory 0.10 20
0.05 10
0.00 0
1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49
Batch Size, Q
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 Process Analysis: Batch Production
A Bread-Making Operation

Mix Proof Bake

Process Time: Process Time: Process Time:

Raw ¾ hour/100 loaves ¾ hour/100 loaves 1 hour/100 loaves
Materials Finished
WIP Pack Goods

Process Time:
¾ hour/100 loaves
Mix Proof Bake

Process Time: Process Time: Process Time:

¾ hour/100 loaves ¾ hour/100 loaves 1 hour/100 loaves

Initial assumptions:
The bakery sells only white bread
Two parallel baking lines, each equipped with a mixer, a proofer, and an oven
The two baking lines share a single packaging line
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 Process Analysis: Batch Production
A Bread-Making Operation
Mix Proof Bake

Raw Process Time: Process Time: Process Time:

Finished
Materials ¾ hour/100 loaves ¾ hour/100 loaves 1 hour/100 loaves WIP Pack Goods

Process Time:
Mix Proof Bake ¾ hour/100 loaves

Process Time: Process Time: Process Time:

¾ hour/100 loaves ¾ hour/100 loaves 1 hour/100 loaves

Which resource is the bottleneck within each baking line?

Mix Proof Bake
Process time ¾ hr ¾ hr 1 hr
(100 loaves)

What is the cycle time of the 1st baking line? 2nd baking line?
- CT of the 1st baking line= 1hr/ 100 loaves
- Same
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 Process Analysis: Batch Production
Mix Proof Bake
Raw
Materials Cycle Time: 1 hour/100 loaves WIP Pack Finished
Goods

Process Time:
Mix Proof Bake ¾ hour/100 loaves

Cycle Time: 1 hour/100 loaves

What is the cycle time for the entire baking-line operation?

CT of the entire baking-line operation = 1 hour/ 100 loaves + 1hour/ 100 loaves
= 1 hour/200 loaves or 1/2 hours/100 loaves

What is the cycle time for the entire bread-making process?

Both Baking Lines Pack
Process time ½ hr ¾ hr
(100 loaves)
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 Process Analysis: Batch Production
Mix Proof Bake

Raw Process Time: Process Time: Process Time:

Finished
Materials ¾ hour/100 loaves ¾ hour/100 loaves 1 hour/100 loaves WIP Pack Goods

Process Time:
Mix Proof Bake ¾ hour/100 loaves

Process Time: Process Time: Process Time:

¾ hour/100 loaves ¾ hour/100 loaves 1 hour/100 loaves

Suppose that the bakery is considering replacing some of its existing

equipment with more advanced and faster equipment. The choice is
between:
(i) purchasing two new ovens that are each capable of baking a batch of 100
loaves in ¾ hour, or
(ii) replacing the packaging line with a new one that is capable of packaging a
batch of 100 loaves in ½ hour
Which option would allow the greatest increase in the bakery’s overall
capacity?
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 Process Analysis: Batch Production
Mix Proof Bake
Raw
Finished
Materials WIP Pack Goods

Process Time:
Mix Proof Bake ¾ hour/100 loaves

Cycle Time: ½ hour/100 loaves

Cycle Time: ¾ hour/100 loaves

(i) purchasing the two new ovens will reduce the bottleneck time for the entire
baking line operation from ½ hour/100 loaves to 3Τ8 hour/100 loaves but will not
increase the bakery’s overall capacity since the baking line operation is not the
bottleneck
(ii) with the new packaging line, the bottleneck time for the entire bread-making
process
Both Baking Lines Pack
Process time ½ hr ½ hr
(100 loaves)
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 Process Analysis: Batch Production
Croissant Manufacturing
RM: WIP:
Dough Mix Proof Roll & Cut Dough

Process Time: Process Time: Process Time:

5 min/50 croissants 15 min/50 croissants 5 min/50 croissants
Finished
Fill & Fold Bake Pack
Goods
Process Time: Process Time: Process Time:
RM: WIP: 5 min/50 croissants 20 min/50 croissants 10 min/50 croissants
Filling Mix Filling
Filling
Process Time:
10 min/50 croissants

Initial assumptions:
Making dough and mixing filling are done separately
Both tasks (making dough and mixing filling) must be completed before
croissants can be filled, folded, baked, and packed
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 Process Analysis: Batch Production
Croissant Manufacturing
What is the cycle time of the dough-making line?

RM: WIP:
Dough Mix Proof Roll & Cut Dough

Process Time: Process Time: Process Time:

5 min/50 croissants 15 min/50 croissants 5 min/50 croissants
Finished
Fill & Fold Bake Pack
Goods
Process Time: Process Time: Process Time:
RM: WIP: 5 min/50 croissants 20 min/50 croissants 10 min/50 croissants
Filling Mix Filling
Filling
Process Time:
10 min/50 croissants

Mix Proof Roll & Cut

Process time (50 CROIS) 5 mins 15 mins 5 mins
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 Process Analysis: Batch Production
Croissant Manufacturing
What is the cycle time of the combined dough-making and mix-filling
operations?
RM: WIP:
Dough Mix Proof Roll & Cut Dough

Process Time: Process Time: Process Time:

5 min/50 croissants 15 min/50 croissants 5 min/50 croissants
Finished
Cycle Time (Dough-Making): 15 min/50 croissants Fill & Fold Bake Pack
Goods
Process Time: Process Time: Process Time:
RM: WIP: 5 min/50 croissants 20 min/50 croissants 10 min/50 croissants
Filling Mix Filling
Filling
Process Time:
10 min/50 croissants

Dough Making Mix Filling

Process time (50 CROIS) 15 mins 10 mins
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 Process Analysis: Batch Production
Croissant Manufacturing
What is the cycle time of the entire croissant-making process?

RM: WIP:
Dough Mix Proof Roll & Cut Dough

Process Time: Process Time: Process Time:

5 min/50 croissants 15 min/50 croissants 5 min/50 croissants

Cycle Time (Dough-Making): 15 min/50 croissants Finished

Fill & Fold Bake Pack
Goods
Process Time: Process Time: Process Time:
RM: WIP: 5 min/50 croissants 20 min/50 croissants 10 min/50 croissants
Filling Mix Filling
Filling
Process Time:
10 min/50 croissants

Cycle Time (Dough-Making & Mix-Filling): 15 min/50 croissants

Dough-Making & Mix-Filling Fill & Fold Bake Pack

Process time (50 CROIS) 15 mins 5 mins 20 mins 10 mins
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 Process Analysis: Batch Production
Croissant Manufacturing
What is the flow time for the entire croissant-making process?

RM: WIP:
Dough Mix Proof Roll & Cut Dough

Process Time: Process Time: Process Time:

5 min/50 croissants 15 min/50 croissants 5 min/50 croissants
Finished
Fill & Fold Bake Pack
Goods
Process Time: Process Time: Process Time:
RM: WIP: 5 min/50 croissants 20 min/50 croissants 10 min/50 croissants
Filling Mix Filling
Filling
Process Time:
10 min/50 croissants

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