CHAPTER 1

System Concepts
 What Is A System?
 A collection of elements that function together
to achieve a desired goal.
 Consists of multiple elements.
 Elements are interrelated and work in
cooperation.
 Exists for the purpose of achieving specific
objectives.
 System Elements
 Who ?
 What ?
 Where ?
 When ?
 How ?
a. Entities
b. Activities
c. Resources
d. Controls
 Entities
 Are items processed through the system such
as products, customers, and documents.
Types:
a. Human or animate (customers, patients, etc.)
b. Inanimate (parts, documents, bins, etc.)
c. Intangible (calls, electronic mail, etc.)
 Activities
 Are tasks performed in the system that are either
directly or indirectly involved in the processing of
entities.
Classes:
a. Entity processes (check-in, treatment, inspection,
fabrication, etc.)
b. Entity and resource movement (forklift travel,
riding of an elevator, etc.)
c. Resource adjustments, maintenance, and repairs
(machine setups, copy machine repair, etc.)
 Resources
 Are the means by which activities are
performed.
Categories:
a. Human or animate (operators, doctors,
maintenance personnel, etc.)
b. Inanimate (equipment, tooling, floor space,
etc.)
c. Intangible (information, electrical power,
etc.)
 Controls
 Dictate how, when, and where activities are
performed.
 Impose order on the system.
 Consist of schedules, plans, and policies (highest
level)
 Take the form of written procedures and machine
control logic (lowest level)
 Provide the information and decision logic for how
the system should operate (all levels)
 System Complexity
 Complex comes from the Latin “complexus”
meaning entwined or connected together.
The principle of bounded rationality says that “the
capacity of the human mind for formulating and
solving complex problems is very small compared
with the size of the problem whose solution is
required for objectively rational behavior in the real
world, or even for a reasonable approximation to such
objective rationality (Simon 1957).
 System complexity is primarily a
function of the following factors:
 Interdependencies between elements so that
each element affects other elements.
 Variability in element behavior that produces
uncertainty.
Therefore, Interdependencies + Variability =
Complexity
 Interdependencies
 Cause the behavior of one element to affect
other elements in the system.

Variability
* A characteristic inherent in any system
involving humans and machinery.
 Examples of System Variability

Type of Variability Examples

Activity times Operation times, repair times, setup times,

move times
Decisions To accept or reject a part, where to direct a
particular customer, which task to perform
next
Quantities Lot sizes, arrival quantities, number of
workers absent
Event intervals Time between arrivals, time between
equipment failures

Attributes Customer preference, part size, skill level

 System Performance Metrics
 Flow time – the average time it takes for an item or
customer to be processed through the system. (cycle
time, throughput time, and lead time)
 Utilization – the percentage of scheduled time that
personnel, equipment, and other resources are in
productive use.
 Value-added time – the amount of time material,
customers, and so forth spend actually receiving
value, where value is defined as anything for which
the customer is willing to pay.
 Waiting time – the amount of time that
material, customers, and so on spend waiting
to be processed.
 Flow rate – the number of items produced or
customers serviced per unit of time (i.e. parts
or customers per hour)
 Inventory or queue levels – the number of
items or customers in storage or waiting areas.
 Yield – the percentage of products completed
that conform to product specs. as a percentage
of the total number of products that entered the
system as raw materials.
 Customer responsiveness – the ability of the
system to deliver products in a timely fashion
to minimize customer waiting time.
 Variance – the degree or fluctuation that can
and often does occur in any of the preceding
metrics.
 System Variables
1. Decision variables – input factors,
independent variables.
2. Response variables – performance or output
or dependent variables
3. State variables – variables that indicate the
status of the system at any specific point in
time.(dependent variables)
 System Optimization

 Finding the right setting for decision variables that

best meets performance objectives.

The Systems Approach

The effective application of scientific and engineering
efforts to transform an operational need into a defined
system configuration through the top-down iterative
process of requirements definition, functional
analysis, synthesis, optimization, design, test and
evaluation (Blanchard 1991).
 Four-Step Iterative Approach to
Systems Improvement

1. Identifying problems and opportunities

2. Developing alternative solutions
3. Evaluating the solutions
4. Selecting and implementing the best solution
 System Analysis Techniques
1. Hand Calculations – use of calculators,
pencil and paper.
2. Spreadsheets – use of MS Excel
3. Operations Research Techniques – use of
Queueing Theory
4. Special Computerized Tools – use of
simulation softwares (PROMODEL, SIM,
etc.)