Understanding the Supply Process: Evaluating Process Capacity
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Basic Process Vocabulary
• Inventory: the number of flow units in the system
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• Activity times: how long does the worker spend on the task?
• Capacity = 1/activity time: how many units can the worker make per unit of time If there are m workers at the activity: Capacity = m/activity time
• Bottleneck: process step with the lowest capacity
• Process capacity: capacity of the bottleneck
• Flow rate = Minimum{Demand rate, Process Capacity)
• Utilization = Flow Rate / Capacity
• Flow Time: The amount of time it takes a flow unit to go through the process
Process data
• 2 grinders
• 22,000 dogs per
• 5 minutes to load
• 6 mixers
• 22,000 dogs per
• 1/3 hour to mix
• 3 machines
• 2,300 dogs per
minute per machine
Inspection
• 17 inspection stations
• Each inspector requires
only 1/6th of a second to inspect each dog
• 8 peelers
• 700 dogs per minute
per peeler
• Each oven holds
15,000 dogs
• Each dog spends
15 minutes in process
Grind trimmings
Mix ingredients
Cook and flavor
Capacity calculations – grind, mix, stuff
Find the capacity of each process step, which is the maximum flow rate (R) through that process step.
Express each process step’s capacity in the same units
You can choose any time length you want (e.g., dogs / min, dogs / day, lbs / second), but you must be consistent.
We’ll choose dogs / min
Each grinder = 22,000 dogs / 5 min = 4,400 dogs / min
2 grinders x 4,400 dogs / min = 8,800 dogs / min
Each mixer = 22,000 dogs/ (1/3 hour x 60 min / hour) = 1,100 dogs / min
6 mixers x 1,100 dogs / min = 6,600 dogs / min
Capacity calculations – stuff, cook, peel, inspect
3 stuffers x 2,300 dogs / min = 6,900 dogs / min
Cook and flavor:
TofindR,useLittle’sLaw,R=I/T I=15,000dogs,T=15min
5ovens?=?dogs/min
Capacity calculations – stuff, cook, peel, inspect
3 stuffers x 2,300 dogs / min = 6,900 dogs / min
Cook and flavor:
TofindR,useLittle’sLaw,R=I/T
I=15,000dogs,T=15min
R=15,000dogs/15min=1,000dogs/min
5ovensx1,000dogs/min=5,000dogs/min
8peelersx700dogs/min=5,600dogs/min
Inspection
1/6sec/dog=6dogs/sec
17stationsx6dogs/secx60sec/min=6,120dogs/ min
Capacity of the entire process The bottleneck?
The capacity of a process is the minimum capacity of the sub processes:
This process cannot produce any more than 5,000 dogs / min on a
consistent basis.
The sub process that constrains the entire process is called the
bottleneck. 8800 dogs / min
Inspection
6120 dogs / min
5600 dogs / min
5000 dogs / min
Grind trimmings
6600 dogs / min
6900 dogs/ min
Mix ingredients
Cook and flavor
What is the capacity of the entire process: flow rate?
Steps for Basic Process Analysis with Multiple Types of Flow Units
1. For each resource, compute the number of minutes that the resource can produce.
2. Create a process flow diagram, indicating how the flow units go through the process.
3. Create a table indicating how much workload each flow unit is consuming at each resource.
4. Add up the workload of each resource across all flow units.
5. Compute the implied utilization of each resource as:
The resource with the highest implied utilization is the bottleneck.
Note: You can also find the bottleneck based on calculating capacity for each step and then dividing the demand at this resource by the capacity.
Process analysis with different types of flow units
Contact faculty
Consulting
Internship
Three types of job applications need to be processed: “consulting,” “staff,” and “internship”
There are inventory buffers in front of each resource/task (not shown)
Each type of application has its own path through the process and does not necessarily visit all tasks.
Contact prior employers
Decision letter
Benchmark grades
Defining the common flow unit
Contact faculty
Consulting
Internship
Define the common flow unit so that:
(1) The capacity of each task can be expressed in terms of the “flow
unit” per unit of time.
(2) Demand can be expressed in terms of the “flow unit.”
An intuitive and natural flow unit for this process is an “application”:
Given that an “application” is the flow unit …
The capacity of each task should be defined in terms of “applications per unit time”
Demand should be expressed in terms of “applications per unit time”
Contact prior employers
Decision letter
Benchmark grades
Demand and capacity
Demand data (given to us):
Applications per hour
Consulting 3 Staff 11 Internship 4
Staffing and processing time data (given to us) and capacity calculations:
Contact Contact Benchmark Decision faculty employers grades letter
Number of workers (a) 2 3 2 1
Processing time (min/app) (b) 20 15 8 2
Calculations:
Capacity per worker (app/min) (c = 1/b) 0.05 0.07 0.13 0.50
Task’s capacity (app/min) (d = a x c) 0.10 0.20 0.25 0.50
Task’s capacity (app/hour) (d x 60) 6 12 15 30
Evaluating implied utilization
Contact Contact Benchmark Decision faculty employers grades letter
Consulting demand (app/hour) 3 3 0 3
Staff demand (app/hour) 0 11 0 11
Internship demand (app/hour) 0 0 4 4
Calculations
Total Demand (app/hour) (a) 3 14 4 18
Task’s capacity (app/hour) (b) 6 12 15 30
Implied Utilization (a/b) 50% 117% 27% 60%
Evaluate the total workload on each task:
For example, “Contact employers” receives 14 apps/hr.
Implied utilization is the ratio of demand on a task to its capacity.
The task with ? is the bottleneck.
Defining a different flow unit – one minute of work
Contact Contact Benchmark Decision faculty employers grades letter
Consulting demand (app/hour) 3 3 0 3
Staff demand (app/hour) 0 11 0 11
Internship demand (app/hour) 0 0 4 4
Processing time (min/app) (b) 20 15 8 2
Define the flow unit to be “one minute of work”:
Demands and capacity should then be expressed in terms of “minutes of
Consider the “Contact employers” task:
Demand on this task is 14 applications per hour.
Each application requires 15 minutes of work.
So demand on this task each hour is ? minutes of work
Defining a different flow unit – one minute of work
Contact Contact Benchmark Decision faculty employers grades letter
Total Demand (app/hour) (a) 3 14 4 18
Processing time (min/app) (b) 20 15 8 2
Number of workers (c) 2 3 2 1
Calculations
Total Demand (min/hour) (d = a x b) 60 210 32 36
Task’s capacity (min/hour) (e = c x 60) 120 180 120 60
Implied Utilization (d/e) 50% 117% 27% 60%
Defining the flow unit as “one minute of work” yields the same implied utilizations as defining the flow unit as “one application.”
In other words, the implied utilization does not depend on how the flow unit is defined as long as all demands and capacities are defined with the same flow unit.
In a process with a series of tasks:
The bottleneck’s capacity determines the maximum flow rate through
the process.
Adding capacity to the bottleneck will increase the capacity of the total process, but may cause the bottleneck to move to another task/resource.
Line balancing (i.e., reallocating tasks from the bottleneck to another resource) can improve the capacity of the total process without adding resources.
Implied utilization of a resource can be evaluated even if there are different types of flow units.
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