OMSAN LOJSTK

Top Management Program in Logistics

& Supply Chain Management (TMPLSM)
Production and Operations Management
2: Process Flow Fundamentals

Common Measures in
Process Flow
Throughput Rate: Average number of units
processed per time unit. (Also called production rate, flow rate,
output rate or processing rate. )

Cycle Time: Average time between completion of

successive units

Throughput Time: Average time a unit spends in

the system (including all waiting times). Also called production lead
time

Work-In-Process: Number of units in the system

Capacity Utilization: Throughput Rate /
3

Capacity

How Fast do we make it?

Bread-making

Cycle Time (CT) =

1 hour/100 loaves

WIP

Packaging

FGI

CT =
3/4 hour/100 loaves

Bread is made in batches of 100 loaves each. Bread-making completes a

batch of 100 loaves every hour one hour is the bread-making cycle time for
a batch of 100 loaves.
Packaging needs only of an hour to place the 100 loaves in bags of an
hour is the packaging cycle time for a batch of 100 loaves.
Questions:
Cycle time for the entire process? Is the process balanced?
Bottleneck?
Capacity? (hint: inverse of the cycle time for the entire process)
4

A Simple Example

An Emission Inspection Line

Assume this is the situation during most

2 cars in queue
Drive In

Inspection Station

Drive Out

Capacity: Average 20 cars/hr

What is the throughput

What is the cycle

rate? [Average number of units p

time? [Average time between completion

What is the throughput

time? [Average time a unit spend

What is Work-in-process? [Number

What
is the capacity
5

utilization?

of units in the syste

A Slightly more complicated example

An Emission Inspection Line

Again assume this is the situation during most of the day

2 cars in queue
Set Up &
Pay

Drive In

Capacity: 60 cars/hr.

What is the throughput

What is the cycle

Check
Exhaust

Print
Report

40 cars/hr.

20 cars/hr

rate? [Average number of units p

time? [Average time between completion

What is the throughput

time? [Average time a unit spend

What is Work-in-process? [Number

What is the capacity
6

Drive Out

of units in the syste

utilization for each station?

Any relationships
among these variables?

Lets start with the obvious ones

Arrival Rate
Departure Rate

Throughput Rate
Cycle Time
7

Consider A Simple Process

Queue
Arrivals

Sever
Departures

At Equilibrium

Average Arrival Rate = Average Departure Rate

(Except for Black Holes!)

Queue

Sever

Arrivals

Departures

l = Departure
Rate

l = Arrival
Rate
Same as Throughput Rate
9

Cycle Time

(Time between departures)

l = Arrival
Rate
Cycle Time = 1/
Or

Cycle Time = 1 / Throughput Rate

10

l = Departure
Rate
l

Throughput Time

Total Time in the System

m = Average number of jobs serviced per period

Time in Queue
Wq (hrs/job)
W =11Throughput time
W = W + 1/m

Service time:
1/m (hrs/job)

Now

the relationship between

Arrival
Rate

12

Throughput
Time

Work In
Process

Littles Law

Looks complicated but it is stating the obvious!

L=lW

l = Arrival

Rate

(or Throughput Rate)

W= Throughput

Time

L= Work In

Process

WIP = Throughput Rate x Throughput Time

13

An Example

Assume Georgetown has 6,000 undergrads.

Applicants totaled 12000 but only 20% were
accepted. Of those accepted, 50% actually
enrolled.

How many years, on average, does an

undergrad spend at Georgetown?
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Capacity Utilization

Arrivals
l (jobs/hr)

Service Capacity Departures

l (jobs/hr)
m (jobs/hr)

Capacity Utilization: r = l / m
15

So, once again

Throughput Rate:

Average number of units processed per time unit .

Cycle Time: 1 / l

Average time between completion of successive units

Throughput Time: W
Average time a unit spends in the system (including all waiting times).

Work-In-Process: L
Number of units in the system

Capacity Utilization:

r=l/m

Throughput Rate / Service Rate Capacity

16

60 cars/hr.*

40 cars/hr.*

20 cars/hr.*

Set Up &
Pay

Check
Exhaust

Print
Report

Drive Out LINE 1

Set Up &
Pay

Check
Exhaust

Print
Report

Drive Out LINE 2

Set Up &
Pay

Check
Exhaust

Print
Report

Drive Out LINE 3

6 cars

10 cars

8 cars

Cars In

Cars Out

5 cars

* Capacities for operations in each line.

a) What is the cycle time for this (entire) inspection facility?

b) What is the capacity of this inspection facility (how many cars per day can be tested)?
c) When the process is working at capacity, what is capacity utilization rate at each station?:
d) If you are the first person in the morning, how long would it take to have your car inspected
(i.e., the throughput time when you dont wait)?

e) When
17 the situation is like the above, what is the throughput time for a car in different lines?