O PERATİONS & L OGİSTİCS M ANAGEMENT İN A İR T RANSPORTATİON P ROFESSOR D AVİD G İLLEN (U NİVERSİTY OF B RİTİSH C OLUMBİA )& P ROFESSOR B ENNY M ANTİN (U NİVERSİTY OF W ATERLOO ) Istanbul Technical University Air Transportation Systems and Infrastructure Air Transportation Management Strategic Planning M.Sc. Program Module 2-3 : 9-10 June 2014
UNDERSTANDİNG PROCESSES 2
L EARNİNG O BJECTİVES • Understand the following concepts: Flow Time Capacity Rate Bottleneck Flow Time Capacity Rate • Tool: Process Analysis – Process mapping – Capacity analysis (also called bottleneck analysis) • Applications – McDonald’s make -to-order system – Kristen’s Cookie Company 3
P ROCESSES • What occurs during a transformation process? – Processing – Waiting – Storage Transformation Inputs Outputs Process Raw material, people, Goods information, capital etc. Services 4
E XAMPLES OF PROCESSES wood guitars Factory metal students alumni University Distribution bulk items small parcels center Electronic Dell Computers Components • Processes can involve both goods and services. • Processes can have multiple inputs and/or multiple outputs. 5
P ROCESS E NTİTİES • Flow units : The items that flow through the process – May be homogenous or heterogeneous • Activities : The transformation steps in the process – Each activity takes some time to complete • Resources : They perform the activities – Have capacities • Buffers : Storage units for flow units – May have finite size 6
P ROCESS F LOW D İAGRAM E LEMENTS Activities, tasks or operations Buffers: Queues or inventories Decision points Flow of materials • Example: Bread making Bread Packing Raw Finished Packed Making Material Bread Bread Note: If different types of breads, the bread-making and packing activities may differ for each 7
A N E XAMPLE OF P ROCESSES AT D ELL Dell online Uninformed Informed customers No Leave or Buy? customers Telephone Yes Order information Dell’s Uninformed Informed Information suppliers suppliers system Transportation Components Components at suppliers at Dell Assembly Transportation PC PC 8 delivered at Dell
L EVEL OF D ETAİL İN P ROCESS A NALYSİS A process can be defined at an aggregate level: Transportation Assembly Transportation Components Components PC PC Transportation and assembly can contain many sub-processes: The purpose of the process analysis determines the level of detail in modeling the processes. 9
P ROCESS M EASURES • Cost • Quality measures • Time (Flow measures) • Flexibility measures • Capacity • This course focuses on capacity and flow measures . 10
P ROCESS M EASURES İN P RODUCTİON AND S ERVİCE Production process Service process Flow unit Materials Customers Input rate Raw material releasing rate Customers arrival rate Customers departure rate (service Output rate Finished goods output rate completion rate) Time required to turn materials into Flow time Time that a customer is being served a product Inventory Amount of work-in-process Number of customers being served Capacity Maximum output rate Maximum service completion rate 11
K EY S TEPS İN P ROCESS A NALYSİS Step 1: Determine the Purpose of the analysis Step 2: Process mapping (Define the process) • Determine the flow units • Determine the tasks (sub-processes), and the sequence of the tasks • Determine the time for each task • Determine which resources are used in each task • Determine where inventory is kept in the process • Record this through a process flow diagram (Linear flow chart, Swim-lane (deployment) flow chart, Gantt chart) Step 3 : Capacity Analysis (also called Bottleneck Analysis ) • Determine the capacity of each resource, and of the process Further analysis will be covered later during the course 12
E XAMPLE : M C D ONALD ’ S K İTCHEN • Purpose of the analysis: To determine the capacity rate of a McDonald’s restaurant Link to video • Given this purpose, we draw the process boundary around the kitchen – We do not consider customers’ queue – We do not consider meat cooking processes (we assume cooked meat is always available when needed during the make-to-order process) 13
L İNEAR F LOW C HART • Flow unit: An order (each order = one burger) • Tasks and sequences • Flow time of each task Place an Toast Add Add meat Package Deliver order buns dressings patties 8s 10s 8s 6s 2s 2s • Determine which resources are used in each task • Could indicate resources along each task • Swim-lane diagram or Gantt chart may be better 14
S WİM -L ANE (D EPLOYMENT ) F LOWCHART RESOURC ACTIVITIES ES Place an Cashier order Worker1 Toast Toaster buns Add Worker 2 dressings Add meat Worker 3 patties Package Worker 4 Worker 5 Deliver 15
S WİM -L ANE F LOWCHART : M ODİFİED RESOURC ACTIVITIES ES Place an Cashier order Worker1 Toast Toaster buns Add Add meat Worker 2 Package dressings patties Worker 3 Worker 4 Worker 5 Deliver 16
G ANTT C HART RESOURCES ACTIVITIES Time Span Cashier Place an order 8 s Worker1 10s Toast buns Toaster Worker 2 Add dressings 8 s Add meat Worker 3 6s patties Worker 4 Package 2s Worker 5 Deliver 2s Time 17
C HOİCE OF C HARTS • Flow chart (linear): – how things flow • Swim-lane flowchart: – how things flow – how resources are shared • Gantt chart: – when and where things flow – when and which resources are used • Typically, we start with flow-charting a process. If shared resources can be clearly indicated on flow charts, we can further analyze bottlenecks, etc. Otherwise, we need to rearrange the flow chart in swim-lanes to understand how resources are shared. Gantt chart is most useful in analyzing bottlenecks of complicated systems. • Choice of charts is an art. 18
P ROCESS M APPİNG : S OME N OTES • There is no one way to draw a process map • Get feedback from all the people involved in the process to validate the process map Do not map the process as you think it works Map it as it actually works • Process maps are surprisingly informative Common response: “I never knew we did it that way!” • Starting point for process analysis, and a great tool for brainstorming process improvements
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B ASİC P ROCESS A NALYSİS S İNGLE S TAGE P ROCESS Toast buns Toaster Worker 1 Flow Time (Time that buns spend in the toaster) 10 sec Capacity Rate ??? 21
Basic Process Analysis Multiple Stage Process Place an Toast Add Add meat Package Deliver order buns dressings patties Worker 1 Cashier Worker 2 Worker 3 Worker 4 Worker 5 Toaster 8 sec 10 sec 8 sec 6 sec 2 sec 2 sec 450/hr 360/hr 450/hr 600/hr 1800/hr 1800/hr Note: The theoretical Theoretical Flow Time of the whole process: 36 flow time ignores the Flow Time of the whole process: ??? sec possibility of waiting; so it is the lowest possible flow time Capacity rate of the whole process: 360 orders/hr Capacity rate of the whole process: ??? 22
G ANTT C HART : M ULTİPLE S TAGE P ROCESS RESOURC ACTIVITIE Time Span ES S 8 s 8 s Cashier Place an order Worker1 10s 10s Toast buns Toaster 8 s 8 s Worker 2 Add dressings Add meat 6s 6s Worker 3 patties 2s 2s Worker 4 Package 2s 2s Worker 5 Deliver Time 23
T HE B OTTLENECK • The resource with the lowest capacity rate – The “slowest” resource (or the resource with the highest “unit load”) – Unit load: Total amount of time the resource works to process each flow unit • Determines the capacity rate of the entire process • Increasing the capacity of non-bottleneck resources does not increase the capacity rate of the process 24
I NCREASİNG THE CAPACİTY RATE OF A PROCESS - W HAT İF WE ADD A CASHİER ? Place an order Toast Add Add meat Package Deliver buns dressings patties Place an order Worker 1 Cashiers Worker 2 Worker 3 Worker 4 Worker 5 Toaster 8 sec 10 sec 8 sec 6 sec 2 sec 2 sec 900/hr 360/hr 450/hr 600/hr 1800/hr 1800/hr (2 * 450/hr) Theoretical Flow Time of the whole process: 36 Theoretical Flow Time of the whole process: ??? sec Capacity rate of the whole process: 360 orders/hr Capacity rate of the whole process: ??? 25
I NCREASİNG THE CAPACİTY RATE OF A PROCESS - W HAT İF WE ADD A TOASTER ? Toast buns Place an Add Add meat Package Deliver order dressings patties Toast buns Worker 1 Cashier Worker 2 Worker 3 Worker 4 Worker 5 Toasters 8 sec 10 sec 8 sec 6 sec 2 sec 2 sec 720/hr 450/hr 450/hr 600/hr 1800/hr 1800/hr (2 * 360/hr) Theoretical Flow Time of the whole process: 36 sec Theoretical Flow Time of the whole process: ??? Which task is the bottleneck? Capacity rate of the whole process: 450 orders/hr Capacity rate of the whole process: ??? 26
A DDİNG A T OASTER : G ANTT C HART RESOURC ACTIVITIE Time Span ES S 8 s 8 s Cashier Place an order Worker1 10s Worker 1 is not busy Toast buns Toaster 1 all the time, and can take care of 2 toasters Worker1 10s Toast buns Toaster 2 8 s 8 s Worker 2 Add dressings Add meat 6s 6s Worker 3 patties 2s 2s Worker 4 Package 2s 2s Worker 5 Deliver 27 Time
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