# Mgt 203—Operations Management

HBR Process Fundamentals HBR Capacity Analysis

Definitions
Process flow diagram Traces the flow of materials through a process (assembly line). Capacity Maximum rate of output from the process, and is measured in units of output per unit of time Bottleneck An operation that has the lowest effective capacity of any operation in the production system and thus limits the system’s output. Cycle time (at a station) The time to produce a given number of units at that station (e.g. 1 hour for 5 cars). Manufacturing lead time The time it takes one unit (or batch) of product to go through the entire empty assembly line from start to finish. Utilization Is the ratio of the input the process actually used in creating the output to the amt of that input available for use. Capacity Utilization Is ratio of capacity actually used (i.e., the output of the process) to the total capacity available

Which process is the bottleneck within each baking line? 2. and an oven.Example 1—Bread Making on Two Lines Initial Assumptions     The bakery sells only white bread. Two parallel baking lines. 8-hour work day Figure 1 Process Flow Diagram and Cycle Times for Bread-Making with Two Parallel Lines Mix Raw Materials Cycle Time: 3/4 hour/ 100 loaves Mix Cycle Time: 3/4 hour/ 100 loaves Proof Cycle Time: 3/4 hour/ 100 loaves Proof Cycle Time: 3/4 hour/ 100 loaves Bake Cycle Time: 1 hour/ 100 loaves Bake Cycle Time: 1 hour/ 100 loaves Work in Process Finished Goods Pack Cycle Time: 3/4 hour/ 100 loaves 1. The two baking lines share a single packaging line. a proofer. each equipped with a mixer. What is the cycle time of the 1st baking line? The 2nd? .

Figure 2 Cycle Times for each Bread-Making Line Mix Raw Materials Proof Bake Cycle Time: 1 hour/100 loaves Mix Proof Bake Work in Process Pack Cycle Time: 3/4 hour/ 100 loaves Finished Goods Cycle Time: 1 hour/100 loaves 1. What is the overall daily capacity of the bread-making operation? Options: The bakery is considering replacing some of its existing equipment with more advanced and faster equipment. What is the cycle time for the entire baking line operation? 2. or (ii) purchasing a new packaging line that is capable of packaging a batch of 100 loaves in ½ hour. What is the cycle time for the entire bread-making process? 3. The choice is between: (i) purchasing two new ovens that are each capable of baking a batch of 100 loaves in ¾ hour. Which option would allow the greatest increase in the bakery’s overall capacity? What is the new overall daily capacity? .

and packed. What is the manufacturing lead time of the croissant making process? .  8-hour work day Figure 4 Process Flow Diagram and Cycle Times(CT) for Croissant-Making Raw Materials: Dough Mix CT: 5 min/50 croissants Proof CT: 15 min/50 croissants Roll & Cut CT: 5 min/50 croissants Work in Process: Filling Work in Process: Dough Fill & Fold CT: 5 min/50 croissants Finished Goods Bake CT: 20 min/50 croissants Pack CT: 10 min/50 croissants Raw Materials: Fillings Mix Filling CT: 10 min/50 croissants 1. folded.  Both making dough and mixing filling must be finished before croissants can be filled.Example 2—Croissant Manufacturing Assumptions  Making dough and mixing filling are done separately. What is the cycle time of the combined dough making and mixing filling operations? 3. baked. What is the cycle time of the dough making line? 2. What is the overall daily capacity? 5. What is the cycle time of the entire croissant making process? 4.

Figure 5 Gantt Chart for Croissant Making Mix Proof Roll & Cut Mix Filling Fill & Fold Bake Pack 5 10 20 30 40 TIME 50 60 70 80 Batch #1 Batch #2 What if we had started Batch #2 immediately after Batch #1 was mixed? .

Choose the largest.Capacity Analysis Summary Example To find the cycle time: 1. Bottleneck? 2. Choose the largest./unit Line 2 1. 2. Manufacturing Lead Time? . To find the manufacturing lead time: 1. Adjust for any parallel processes./unit Drilling 12 min./unit Drilling 12 min. Cycle Time? 3./unit Finishing 2 min. Calculate time through every path in the system (ignore parallel processes). Sawing 10 min./unit Sanding 4 min. 2./unit Line 1 Sawing 10 min./unit Sanding 4 min./unit Measuring 8 min.