A Note on Process Analysis

A process is a group of related activities that takes inputs and transforms them into outputs. Process analysis is a diagnostic; a measure of the processes ability to meet expectations. Can my manufacturing plant produce the volume needed? Can it meet the quality standards demanded by customers? How many customers can the kitchen of our new restaurant handle during the rush hours of 6-10 pm? Process analysis is often used to identify improvement opportunities in an existing process or, alternatively, to determine if the design of a new process is sufficiently robust to meet customer expectations. The methodologies and language used in process analysis are used in both manufacturing (product) and service industries. Discrete activities found in manufacturing generally result in a more precise analysis. Assembling rear doors on the Honda Accord does not vary from car to car and therefore lends itself to a more precise analysis. Determining capacity in a service environment is generally less precise because of the human element and its influence on task time. The next customer in line at Starbucks may want to tell the Barista about their day; lengthening the time required to complete the customers order. Although we try to manage customer time, we cannot always do so with precision, resulting in a less accurate analysis of task time. Process flow chart A good way to begin analyzing a process is with a diagram of the basic elements of the process. Three things typically included in a process flow chart are tasks, flows, and queues or storage areas. Tasks are typically depicted as boxes to represent the task, flows as arrows, and queues as inverted triangles. Although the specific shapes used can be changed to a users preference, the use of standard symbols improves the readability of the chart. Process flow charts (or diagrams) show the specific sequence of tasks or process steps necessary to create a particular product or service. The diagram may include task times for each step, along with the identification of required human or machine resources. The level of detail and scope of information contained in the process flow diagram will vary based upon the objectives of the chart. If the charts objective is to demonstrate the high-level flow of materials through a manufacturing process or the steps of a service process (e.g., the flow of patients through a dentists office), then the chart will contain few details. However, a chart intended to support the detailed analysis, evaluation and improvement of a process will incorporate a higher level of detail, including task times and the number of resources assigned to each task.

Bill Costello 2009. This note is a compilation of work from those authors noted in the Bibliography.

Consider the example of Porthos Bakery Porthos Bakery is a commercial bread baker located in Cambridge, MA. They supply bread to many Boston area restaurants. The bread making process is described below: Step 1: Mixing. In the mixing stage, all the ingredients are combined to form the dough. Porthos has three automated mixing machines that are operated by three individual workers; one worker attending each machine. Mixing is done in batches of 10 lbs each and requires 10 minutes of mixing time (including load/unload time) per batch. Step 2: Proofing. After mixing, the dough must then rise in a controlled environment called a proofing box or proofing oven; which monitors humidity and temperature. There are 7 proofing ovens. Proofing requires 30 minutes per batch of 10 lbs. Two operators load and unload the ovens. Step 3: Baking. Following the proofing, the bread is formed into loaves and baked. There are four conveyorized baking ovens (tunnels).* Two operators form the loaves and load and unload the ovens. Loaves are in the baking tunnel for 30 minutes. The operators are also responsible for monitoring oven temperature. Each oven has a capacity of 40 lbs. per hour. *a conveyorized baking tunnel is a continuously moving belt. The speed of the belt determines baking
time.

Step 3: Packaging. In the final step, the bread is packaged prior to distribution. There are three packaging machines; each attended by one operator. The capacity of each packing machine is 75 lbs. per hour. Below is the process flow chart for Porthos Bakery:

Mix

Proof

Baking

Pack

Quantitative process analysis After drawing the process flow chart, we are ready to analyze the activities in the process. We utilize the following measures to complete this analysis: Task Time The task time is the time required at a particular process step to complete all activities of that step. The task time is generally expressed in minutes per unit (manufacturing) or minutes per customer (service).

Cycle time The cycle time for a task - or process step - is the average interval between completion of two units of production. If there is only one worker at a step or all workers at the step are simultaneously working on the same item then the task time and the cycle time are identical. However, if there is more than one resource (human or machine) at a process step and each resource can independently complete all of the work for that process step, then the process step time should be divided by the number of resources to obtain the average.

Bottleneck This is the step in the process with the longest cycle time (and therefore lowest output capacity). Since a process or system can only produce as fast as its slowest step, the bottleneck limits the systems output. True enhancement of a facilitys capacity occurs only when bottleneck capacity is increased. The cycle time for the bottleneck step is also called the system cycle time. Capacity Capacity is the amount of work that can be processed per unit of time (e.g., pieces per hour, tons per day, patients per shift, etc.) This may refer to an entire process, or one of the steps in the process. Either machines or labor can constrain capacity. Theoretical (maximum) capacity is the most output a process could generate under ideal conditions. Theoretical capacity for the overall process is calculated by dividing the available processing time (e.g., minutes per day) by the system cycle time (cycle time for the bottleneck step), which we now know is the cycle time of the slowest step in the process. The system cannot produce more output than the capacity of the bottleneck step. To calculate capacity for a specific task (or process step), we calculate capacity by dividing the available processing time by the cycle time of the process step.
Theoretical Capacity of the Process = Total Time Available/ System Cycle Time Theoretical Capacity of a Process Step = Total Time Available/Cycle Time for the Process Step

Capacity seems a straightforward measure. This may be true for a process producing one product or service. Finding relevant capacity measures for a process that produces multiple products or delivers multiple services, however, can be complicated. In many cases, the system capacity will depend on the lot size and mix of products. Product mix, staffing, efficiency and other factors often affect the capacity of an entire process. Therefore, the actual capacity and capacity utilization will depend on how well the process is managed. Actual output or production volume The actual output of a process is the number of units actually produced during a given period of time. We rarely produce at theoretical capacity due to a variety of factors. It is easy to understand how the actual output would be less than theoretical capacity. Would

the actual output ever be greater than the theoretical capacity? Why, and how, might this occur? Capacity Utilization Capacity utilization is the percent of the theoretical capacity being used at a planned or actual production rate. Capacity utilization gives managers a feel for how effectively they are matching available capacity to actual production. Capacity utilization is typically expressed as a percentage. Optimal capacity utilization is situation specific. For instance, under certain economic conditions an oil refinery may wish to operate near 100% capacity utilization but you may not want to manage a hospital emergency room at or near 100% of capacity. Capacity Utilization = Capacity required (demand) / Capacity Available (Theoretical) Work-in-Process (WIP) Work-in-process or WIP is the number of in-process units waiting to be completed within the operation. If each process step contains 2 batches of 10 items each, then WIP is equal to: WIP = # of process steps * 2 * 10 Throughput time Throughput time is the amount of time it takes one specific unit to progress through all steps of the process (the sum of individual task times.) If there are steps in the process that occur simultaneously (e.g., an auto assemble line where people work on each side of the car as it is being assembled), the throughput time of the longest of the simultaneous steps are included in the calculation. Think of throughput time as if you were walking a specific unit through each step in the process. How long would it take? Throughput time does not consider WIP. Lead time Lead time is similar to throughput time but also accounts for WIP and other delays in the process, such as the time taken to move materials from one process step to the next. Therefore, lead time is seldom the sum of individual task times. We can think about lead time as the time needed to get the next unit through the production process, given the current state of the production system. There is a direct relationship between actual cycle time, WIP, and lead time, as shown in the formula below. Lead time = WIP * Actual cycle time
where actual cycle time = actual production time used/actual production quantity

Direct Labor Content The labor content of a product is the total of all direct labor time used to create the product. If there is more than one worker at a process step, you must consider whether

the workers are simultaneously working on the same item, or whether they are each working on their own items. If workers are working simultaneously on the same item, then labor content must account for the activity time of all workers (well have to pay all of them). When calculating the labor time we must account for the total time invested by all direct workers.

Idle time The amount of time a resource (human or machine) is unused during each process cycle. The intent is to minimize the idle time across all workstations and resources, and therefore create a more balanced process. Idle time can exist for one resource in a process step. For example, a worker may load a machine then wait while the machine automatically performs its task.

Balance Maintaining the efficient flow of goods, services, or information through the operating system is a key management concern. The balance of work allocated to various work centers or resources significantly impacts this efficiency. In a process with a line arrangement, where units must pass through each step in the process sequentially, line balance refers to the extent to which individual cycle times are equal. An imbalance leads to idle time for human and/or machine resources.

Selected Bibliography Jacobs, F. Robert, Chase, Richard B., Aquilano, Nicholas J., Operations & Supply Management, 12th Edition, McGraw-Hill Irwin Davis, Mark M., Heineke, Janelle, Operations Management: Integrating Manufacturing and Services, Fifth Edition, McGraw-Hill Irwin Mulligan, Paul and Engelkmeyer, Susan, Process Analysis: A method to improve how you do what you do, Babson College