23-09-2016

Process Analysis
Summary

Key Concepts
Lead Time (Flow Time)
How long (eg. 3 hours)?
Cycle Time: Inter-departure time
How often (eg. every 50 sec)?
Throughput Rate (Flow rate)
Generally Demand Rate (if less than capacity) or
Capacity
Work in Process Inventory
Utilization
Usage of machines or humans

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Setup time and Batch Size

At any step if you have a setup time (eg,

Cutting Operation in Executive Shirt)
Capacity of that Step (given the Batch Size) =

Lead Time (Flow Time)

Definition:
The amount of time between the placing of an
order and the receipt of the goods ordered. The
lead time is the time spent by a typical part,
job, (order), or customer in the system.
Total time required to complete one unit of a
product or service.

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Cycle Time
Cycle time is the average time between parts
exiting the process or task (if you were to stand
and observe it). It is the inter-departure time
from a process or a system.
What is the Cycle Time in Kristins Cookie?
What happens if Demand is less than
Capacity?

Throughput Rate
Throughput Rate (or Flow Rate ) is the
number of units that flow through a
specific point of the process per unit time.
Throughput Rate is less than or equal to
Capacity
Throughput Rate = 1/Cycle Time

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Work-in-Process (WIP)
The inventory (of material, documents or
people) between the start and end point of
a process

Littles Law
Average WIP = Throughput rate * Average
Lead Time

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Utilization
Utilization = Demand Rate/Capacity
What is the utilization of oven if demand is 5
dozens/hour?
Labour Utilization =
Labour hours used/Labour Hours available