Process Analysis II. © The McGraw-Hill Companies, Inc., 2004 Operations -- Prof. Juran2 Outline Types of Processes Kristin Benihana Scientific Management.

Process Analysis II

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 2

Outline

• Types of Processes • Kristin• Benihana• Scientific Management

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 3

IV.Continuous

Flow

III.Assembly

Line

II.Batch

I.Job

Shop

LowVolume,One of a

Kind

MultipleProducts,

LowVolume

FewMajor

Products,HigherVolume

HighVolume,

HighStandard-

ization

CommercialPrinter

French Restaurant

HeavyEquipment

AutomobileAssembly

Burger King

SugarRefinery

Flexibility (High)Unit Cost (High)

Flexibility (Low)Unit Cost (Low)

These are the major stages of product and process life cycles

These are the major stages of product and process life cycles

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 4

Process Flow Structures

• Continuous Flow (ex. Petroleum manufacturer) • Assembly Line (ex. Automobile manufacturer)• Batch shop (ex. Copy center making 10,000

copies of an ad piece for a business)• Job shop (ex. Copy center making a single

copy of a student term paper)• Extreme Case: Project (ex. Legal Counsel for a

Criminal Trial)

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 5

Kristin’s CookiesOrder Entry

Wash Bowl, Mix Ingredients Resource: Self

Capacity: 3 Cycle Time: 6 minutes

Fill Tray Resource: Roommate

Capacity: 1 Cycle Time: 2 minutes

Bake Resource: Oven

Capacity: 1 Cycle Time: 9 minutes

Start Oven Resource: Roommate, Oven

Capacity: 1 Cycle Time: 1 minute

Remove Resource: Roommate

Capacity: 1 Cycle Time: 0 minutes

Cool Resource: none

Capacity: 1 Cycle Time: 5 minutes

Pack, Collect Money Resource: Roommate

Capacity: 1 Cycle Time: 3 minutes

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 6

1. How long will it take for you to fill a rush order?

Assuming this order is for one dozen cookies, we will need to do the following:

Activity Resource Cycle Time Start Time Finish Time Order Entry E-mail 0 minutes 00:00 00:00

Wash Bowl, Mix Self 6 minutes 00:00 06:00 Fill Tray Self 2 minutes 06:00 08:00

Prepare Oven Roommate 1 minute 08:00 09:00 Bake Oven 9 minutes 09:00 18:00

Remove Roommate 0 minutes 18:00 18:00 Cool None 5 minutes 18:00 23:00

Pack, Collect Money Roommate 3 minutes 23:00 26:00 Therefore, the minimum time to fill an order is 26 minutes.

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 7

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 8

2. How many orders can you fill in a night, assuming you are open four hours each night?

Here is a Gantt chart for two batches of one dozen cookies each. It doesn't take twice as long to produce two batches as it does to produce one batch, because you can start mixing the second batch without having to wait for the whole first-batch process to be completed (you can start washing out the bowl as soon as you finish filling the tray). It is possible to produce two batches in 36 minutes.

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Operations -- Prof. Juran 9

In general, a formula for the number of minutes to produce n one-dozen batches is given by this expression:

n1016

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© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 10

3. How much of your own and your roommate's valuable time will it take to fill each order?

For yourself:

Activity Cycle Time Wash Bowl, Mix 6 minutes Fill Tray 2 minutes Total 8 minutes

For your roommate:

Activity Cycle Time Prepare Oven 1 minute Remove 0 minutes Pack, Collect Money 3 minutes Total 4 minutes

This is assuming all orders are for one dozen cookies.

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 11

4. Because your baking trays can hold exactly one dozen cookies, you will produce and sell cookies by the dozen. Should you give any discount for people who order two dozen cookies, three dozen cookies, or more? If so, how much? Will it take any longer to fill a two-dozen cookie order than a one-dozen cookie order?

First, let's consider costs. The cost of ingredients and the box are the same, no matter how many dozen you bake. So the only resource that might differ with the size of the batch is labor.

One Dozen

Activity Resource Cycle Time Start Time Finish Time Order Entry E-mail 0 minutes 00:00 00:00

Wash Bowl, Mix Self 6 minutes 00:00 06:00 Fill Tray Self 2 minutes 06:00 08:00

Prepare Oven Roommate 1 minute 08:00 09:00 Bake Oven 9 minutes 09:00 18:00

Remove Roommate 0 minutes 18:00 18:00 Cool None 5 minutes 18:00 23:00

Pack, Collect Money Roommate 3 minutes 23:00 26:00

Self 8 Roommate 4 Total Labor Minutes 12

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© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 12

Two Dozen

Activity Resource Cycle Time Start Time Finish Time Order Entry E-mail 0 minutes 00:00 00:00

Wash Bowl, Mix Self 6 minutes 00:00 06:00 Fill Tray 1 Self 2 minutes 06:00 08:00 Fill Tray 2 Self 2 minutes 08:00 10:00

Prepare Oven 1 Roommate 1 minute 08:00 09:00 Bake 1 Oven 9 minutes 09:00 18:00

Remove 1 Roommate 0 minutes 18:00 18:00 Cool 1 None 5 minutes 18:00 23:00

Prepare Oven 2 Roommate 1 minute 18:00 19:00 Bake 2 Oven 9 minutes 19:00 28:00

Remove 2 Roommate 0 minutes 28:00 28:00 Cool 2 None 5 minutes 28:00 33:00 Pack 1 Roommate 2 minutes 23:00 25:00 Pack 2 Roommate 2 minutes 33:00 35:00

Collect Money Roommate 1 minute 35:00 36:00

Self 10 Roommate 7 Total Labor Minutes 17

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Operations -- Prof. Juran 13

Three Dozen

Activity Resource Cycle Time Start Time Finish Time Order Entry E-mail 0 minutes 00:00 00:00

Wash Bowl, Mix Self 6 minutes 00:00 06:00 Fill Tray 1 Self 2 minutes 06:00 08:00 Fill Tray 2 Self 2 minutes 08:00 10:00 Fill Tray 3 Self 2 minutes 06:00 08:00

Prepare Oven 1 Roommate 1 minute 08:00 09:00 Bake 1 Oven 9 minutes 09:00 18:00

Remove 1 Roommate 0 minutes 18:00 18:00 Cool 1 None 5 minutes 18:00 23:00

Prepare Oven 2 Roommate 1 minute 18:00 19:00 Bake 2 Oven 9 minutes 19:00 28:00

Remove 2 Roommate 0 minutes 28:00 28:00 Cool 2 None 5 minutes 28:00 33:00

Prepare Oven 3 Roommate 1 minute 28:00 29:00 Bake 3 Oven 9 minutes 29:00 38:00

Remove 3 Roommate 0 minutes 38:00 38:00 Cool 3 None 5 minutes 38:00 43:00 Pack 1 Roommate 2 minutes 23:00 25:00 Pack 2 Roommate 2 minutes 33:00 35:00 Pack 3 Roommate 2 minutes 43:00 45:00

Collect Money Roommate 1 minute 45:00 46:00

Self 12 Roommate 10 Total Labor Minutes 22

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© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 14

Let's assume your time is worth $12 per hour. Your labor costs would be:

# Cookies in Batch Minutes Cost Cost per Dozen 1 dozen 12 $2.40 $2.40 2 dozen 17 $3.40 $1.70 3 dozen 22 $4.40 $1.47

It looks like you could afford to give a discount for two- and three-dozen orders. A two-dozen order doesn't cost twice as much as a one-dozen order.

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Operations -- Prof. Juran 15

5. How many food processors and baking trays will you need?

The food processor is only used in the mixing stage, and we ought to be able to see that the processor is idle for long periods of time, and that the real bottleneck is the oven. Buying another food processor won't improve the productivity of the system at all.

The number of baking trays ought to equal the maximum number of trays you will be using at any one time. Three is probably enough.

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Operations -- Prof. Juran 16

6. Are there any changes you can make in your production plans that will allow you to make better cookies or more cookies in less time or at lower cost? For example, is there a bottleneck operation in your production process that you can expand cheaply? What is the effect of adding another oven? How much would you be willing to pay for an additional oven?

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© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 17

Benihana Restaurant

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Operations -- Prof. Juran 18

Important parameters:

• How many chefs and waitresses there are

• How frequently customers arrive at the restaurant

• How quickly customers are seated, either in the bar or in the dining area

• How frequently the customers order and consume drinks

• How quickly drinks are served

• How long it takes to prepare the meal at the grill

• How long it takes for the customers to eat their meal

• How long it takes for customers to pay and leave the dining area.

Benihana: Process Analysis

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Operations -- Prof. Juran 19

Assume that the dining process takes 60 minutes, and that we want customers in the bar for 24 minutes.

Consider three scenarios:

Bar - 8 seats; Dining area - 40 seats

Bar - 16 seats; Dining Area - 80 seats

Bar - 48 seats; Dining Area - 120 seats

Benihana: Process Analysis

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Operations -- Prof. Juran 20

Bar - 8 seats; Dining area - 40 seats

It takes 60 minutes for one customer to eat dinner, and there are 40 seats in the dining area. Therefore 40 people eat every 60 minutes (throughput).

On the average a dinner cycle is completed every 60 minutes/40 people = 1.5 minutes per person (cycle time).

We know that dinners are processed in batches of 8, so on the average a table of 8 finishes every 12 minutes.

Benihana: Process Analysis

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Operations -- Prof. Juran 21

Bar - 8 seats; Dining area - 40 seats

This means that the 8-seat bar must empty every 12 minutes.

The "ideal" time for someone to remain in the bar is about double that time (because this will be just after the second drink has reached the table).

Therefore, it would appear that the ratio of 0.2 (8 bar seats to 40 dining seats) is too small.

Benihana: Process Analysis

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Operations -- Prof. Juran 22

Bar - 16 seats; Dining Area - 80 seats

It takes 60 minutes for one customer to eat dinner, and there are 80 seats in the dining area. Therefore 80 people eat every 60 minutes (throughput).

On the average a dinner cycle is completed every 60 minutes/80 people = 0.75 minutes per person (cycle time).

We know that dinners are processed in batches of 8, so on the average a table of 8 finishes every 6 minutes.

Benihana: Process Analysis

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Operations -- Prof. Juran 23

Bar - 16 seats; Dining Area - 80 seats

This means that the 16-seat bar must empty every 12 minutes.

Therefore, it would appear that the ratio of 0.2 (16 bar seats to 80 dining seats) is too small.

In fact, all this does is double the restaurant’s capacity, and the bar time remains at 12 minutes.

The only benefit is that 16 seats might allow the host or hostess to do a better job of assembling groups of eight.

Benihana: Process Analysis

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Operations -- Prof. Juran 24

Bar - 48 seats; Dining Area - 120 seats

It takes 60 minutes for one customer to eat dinner, and there are 120 seats in the dining area. Therefore 120 people eat every 60 minutes (throughput).

On the average a dinner cycle is completed every 60 minutes/120 people = 0.5 minutes per person (cycle time).

We know that dinners are processed in batches of 8, so on the average a table of 8 finishes every 4 minutes.

Benihana: Process Analysis

© The McGraw-Hill Companies, Inc., 2004

© The McGraw-Hill Companies, Inc., 2004

Operations -- Prof. Juran 25

Bar - 48 seats; Dining Area - 120 seats

To send 8 people into the dining area every 4 minutes means that the 48-seat bar must empty every 24 minutes.

Perfect!

Given our assumptions regarding the cycle times of the bar and the dining area, it would appear that a ratio of bar seats to grill seats of 0.4 is about right.

(In our case 120:48, but the ratio is more important than the specific numbers.)

Benihana: Process Analysis

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Operations -- Prof. Juran 26

Historical Development of OM

• Craft System• Industrial Revolution• Scientific Management• Organizational Science• Operations Research• JIT and TQM• Supply Chain Management• Internet Commerce

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Operations -- Prof. Juran 27

Scientific Management• Frederick Winslow Taylor,

(1856-1915), American industrial engineer.

• In 1878, he began working at the Midvale Steel Company.

• Developed measures of productivity based on time & motion studies.

• Became rich from 100+ patents including tempered steel.

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Operations -- Prof. Juran 28

Taylor’s Industrial Environment

• Large numbers of unskilled workers

• Many immigrants who often didn’t speak English

• Homogeneous markets meant great returns to scale (e.g, Model T dropped in price from $1000 to $360)

• Management not viewed as a general or learnable skill

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Operations -- Prof. Juran 29

Scientific ManagementScientific Management

• Defined by Frederick Taylor, late 1800s.• The systematic study of the

relationships between people and tasks to redesign the work for higher efficiency.– Taylor sought to reduce the time a

worker spent on each task by optimizing the way the task was done.

• Significant improvements in productivity

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Operations -- Prof. Juran 302-6

Taylor’s 4 Principles• Develop a science for each element

of work• Select, train, and develop workers• Cooperate with workers (share the

savings – more $$$ for better performance)

• Divide work and responsibility equally

C

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Operations -- Prof. Juran 31

Resistance to Taylor• Separation of work from planning

destroyed the traditional craft system – ‘money substituted for pride’

• Unions mistrusted – Taylor reduced work force from 450 to 150 on first job

• Some firms cut rates after changes

• Legislation to prevent time studies in government jobs.

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Operations -- Prof. Juran 32

Frank & Lillian GilbrethTime and Motion Studies

Film

Therbligs

Cheaper by the Dozen

Henry L. GanttEngineer; worked with Taylor

Gantt Chart

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Operations -- Prof. Juran 33

The GilbrethsThe Gilbreths• Frank and Lillian Gilbreth refined Taylor’s

methods.– Made many improvements to time and motion

studies.• Time and motion studies:

– 1. Break down each action into components.– 2. Find better ways to perform it.– 3. Reorganize each action to be more efficient.

• Gilbreths also studied fatigue problems, lighting, heating and other worker issues.

© The McGraw-Hill Companies, Inc., 2004

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Operations -- Prof. Juran 34

Summary

• Types of Processes • Kristin• Benihana• Scientific Management