Intro to Process Analysis IIIntro to Process Analysis II

Kristen’s Cookies

Gantt Charts

Resource conflicts

Batch size and setups

Economies of Scale

Getting more for your cookie, er, money!

The Big PictureThe Big Picture

Most of your investments—and a lot of your other costs—are due to resources (people, equipment, etc.)

By avoiding resource conflicts and exploiting economies of scale you can more efficiently use your resources.

Thus, you can either increase production or reduce costs.

Either way, ROI goes up.

KRISTEN’S PROCESS FLOW DIAGRAM

GANTT CHART(ORDER SIZE = 1 DOZ.)

5 10 15 20 25 30 35 40 45 50 55 60 65

oven

roommate

Kristen

pay

pack

cool

bake

mix/spoon

0

Q1. Rush order flowtime per order?

Q2. Process cycle time per order?

Q3. What is the process capacity?

Q4. If we start at 8 pm and end at Midnight, how many cookies can we make?

Let us look at a Gantt chart

Cookie Questions: 1 DozenCookie Questions: 1 Dozen

Q5. What is the labor content per order?

Q6. What is the labor utilization?

Q7. How many baking trays?

How many food processors?

Q8. Where should we add resources?

Add’l. Cookie QuestionsAdd’l. Cookie Questions

GANTT CHART(ORDER SIZE = 2 DOZ.)

0 5 10 15 20 25 30 35 40 45 50 55 60 65

oven

roommate

Kristen

pay

pack

cool

bake

mix/spoon

Q9. Suppose the order size increases.

Order Labor Bottle- System Cycle

ROFT

Size Content neck Capacity Time

1 dz. 12 mn. Oven 6 dz./hr. 10 mn. 26mn.

2 dz.

What happens to the order lead time?

Should we give a Price discount?

5

Suppose we have two ovens. . .

Mix

6 minper order

Cool5 min.

ReceivePayment

1 minper order

Pack2 min/dz

Oven10 min/dz.

Oven10 min/dz

Spoon2 min/dz

Performance with 2 OvensPerformance with 2 Ovens

Order Size

1 dz 2 dz

Kristen’sLabor Content

Room-Mates’Labor Content

Oven mins/order

Oven Cycle Time

Bottle-neck

System Capacity

What is the value of a second oven for order size = 1 dz.?

What is the impact if your roommate is out of town for order size = 1 dz.?

More Cookie QuandariesMore Cookie Quandaries

LESSONSLESSONS

1. Throughput time and Cycle time:

Implications for customers, managers:

Interrelationships:

10

OperatingSystem

ZeroLeadTime

CompleteCustomi-

zation

2. OM tension in the case:

11

3. Importance of process knowledge, learning, experimentation:

LESSONS (cont.)LESSONS (cont.)

The MessageThe Message

BEWARE

Even simple processes are very tricky.Analyzing them is far from simple.

A spreadsheet is not enough.Doing them in your head is not enough.

There is no substitute for using your OM tools.