4. Flow-Time Analysis Flow Time 1-Introduction Based on the book: Managing Business Process Flows

4. Flow-Time Analysis

Flow Time

1-Introduction

Based on the book: Managing Business Process Flows


Competitive Advantages of a short flow time

Short response time both in production and in product design.

More responsive to changes in customer preferences and

technological advancements.

Delayed differentiation, Postponement.

Moving from Made To Stock towards Make To Order.

Lower inventory costs, due to Little’s Law.

Flow Time - Introduction 2Ardavan Asef-Vaziri, June, 2015


Direct Method of Measuring Flow Time

Randomly sample flow units over an extended period of time. Measure the flow time for each flow unit from entry to exit. Compute the average of flow times.

During a given month, a sample of 50 applications was taken The average flow time = 20.8 working days.



Indirect Methods of Measuring Flow Time

Count the number of units produced over an extended period of time.

R = number of units produced / duration of time period . Count the number of units of inventory at random points during the

time period. Compute the average inventory (I). Compute flow time T =I/R

200 applications processed during 20 days; average throughput of R=200/20 = 10 applications per day. The number of waiting applications counted at 4 random points during these days added to 860. I= 860/4 =215.

T = I/R T = 215/10 flow time is 21.5 days vs 20.8Flow Time - Introduction 4Ardavan Asef-Vaziri, June, 2015


Process : Network of activities performed by resources

1-2. Flow unit (input/output): Unit of analysis– Level of detail

3. Network of Activities & Buffers

- Define Process Boundaries

- Activities with activity times

- Buffers with waiting times

- Routes: precedence relationships (solid lines) with throughputs

4. Resources & Allocation

- Who does what?

5. Information Structure & flow (dashed lines)

Key for capacity analysis

Process Flow Chart



Flowcharting

ActivityBuffer

Physical flowEvent

Information flow

See the total process; a systems view Define flow units and process boundaries Include only the key steps Clarify the level of detail needed. Processes can be

broken down into sub-activities. On the other hand, cascading allows several activities to be combined in a single sub-process

Depicts resources required to carry out activities Identify the processes that need attention (weak

points)

Decision



Wondershed Inc: Narrative Representation

1. Separate the roof and the base sheets

2. Punch the base

3. Punch the roof

4. Form the base

5. Form the roof

6. Weld the base

7. Assemble base and roof

8. Inspect



End

Wondershed Inc. : Schematic Representation

StartSeparate

Sheet

Punch base

Punch roof

Form base

Form roof

Wed base

InspectAssemble

StartActivity

AActivity

BActivity

CEnd


Buffer Activity


Theoretical Flow Time

Activity Time: The time required by a typical flow unit to complete the activity. Tp for a single activity.

Theoretical Activity Time. Tp net of any waste inside Tp

Unless stated otherwise, we assume that an activity cannot be broken down into smaller activities that can be executed in parallel. What does that mean???

Pure Theoretical Flow Time: The minimum amount of time required for processing a typical flow unit without any waiting and without any waste inside Tp.

Theoretical Flow Time: The minimum amount of time required for processing a typical flow unit without any waiting.



Critical Path

Theoretical flow time of each path in the process flowchart = sum of the activity times of all activities on that pathCritical Path: the longest path Critical Activities: activities that lie on the critical pathTheoretical flow time of the process = Time of the theoretical

critical path

Activity Time 2Activity Time 1 Activity Time 3


Sequential Activities

Sequential Activities

Parallel Activities

How many Paths?





Wondershed Inc. Theoretical Flow Time

Path 1 (roof) Start 1 3 5 7 8 End 10 +20 +10 +10+30 = 80 minPath 2 (base) Start 1 2 4 6 7 8 End 10 +25+5 + 10 +10+30 = 90 minTheoretical Flow Time = 90 min

Activity Activity Time (Work Content)

1 Separate 102 Punch the base 253 Punch the roof 204 Form the base 55 Form the roof 106 Weld the base 107 Assemble 108 Inspect 30



Wondershed Inc. Flow Time

Path 1 (roof) Start 1 3 5 7 8 End 30 + 110 + 85 + 55 + 105 = 385 minPath 2 (base) Start 1 2 4 6 7 8 End 30 + 70 + 40 + 70 + 55+ 105 = 370 minFlow Time = 385 min

Activity Activity Time (Work Content) Waiting Time Flow Time

1Separate 10 20 302Punch the base 25 45 703Punch the roof 20 90 1104Form the base 5 35 405Form the roof 10 75 856Wed the base 10 60 707Assemble 10 45 558Inspect 30 75 105



Flow Time Efficiencies in White Collar Processes

Flow Time Efficiency = Theoretical Flow Time / Flow

Time

Flow Time Efficiency = 90/385 = 23.4%


Industry Process Average Flow Time

Theoretical Flow Time

Flow Time Efficiency

Life

Insurance

New Policy

Application72 hrs. 7 min. 0.16%

Consumer

Packaging

New Graphic

Design18 days 2 hrs. 0.14%

Commercial

Bank

Consumer

Loan24 hrs. 34 min. 2.36%

HospitalPatient

Billing10 days 3 hrs. 3.75%

Automobile

Manufacture

Financial

Closing11 days 5 hrs 5.60%

Documents

4. Flow-Time Analysis Flow Time 1-Introduction Based on the book: Managing Business Process Flows