Assignment

Capacity
Key Problem1: Flow Chart
A flowchart is a diagram that traces the flow of materials,
customers, information, or equipment through the various
steps of a process
E
C
A B D B
C F

 Capacity Metrics: Capacity, Time to Perform the Activity

(Unit Load; Tp), Cycle Time
 Flow Time Metrics: Theoretical Flow Time; Flow Time

Capacity- Basics Ardavan Asef-Vaziri March, 2015 2

Key Problem1: Single-Stage and Two-Stage
Process
 Cycle time = 1
 Capacity = 1/1min Activity A
per min, 60 per
 Theoretical hour
Flow Time 1 Tp =1 min
= 1 That is Max Ip indeed min
 Ip =
Activity A Activity B
 Cycle time =10 min Tp =10 Tp =8 min
min
 Capacity = 1/10 per min, 6 per
 Theoretical hour
Flow Time 18 min
= 1.8 That is Max Ip indeed ActA
 Ip = 1
That is Max Ip indeed
ActB
 IpA = 0.8 CT CT CT
 IpB =
0 18 28 38 48
Capacity- Basics Ardavan Asef-Vaziri March, 2015 3
Key Problem1: Two-Stage Process
 Cycle time =
10 min Activity A Activity B
 Capacity =6 per hr Tp =5 min Tp =10
min
 Theoretical Flow Time15 min
= 1.5 ActA
 Ip =
0.5
 IpA =1 ActB
 IpB =
CT CT CT

0 15 25 35 45

 The Resource in charge of Activity A is Specialized and

Fast
 The Resource in charge of Activity B is Specialized and
Fast
Capacity- Basics Ardavan Asef-Vaziri March, 2015 4
Key Problem1d: Single-Stage Process
 Lets cross train them and reduce set up time of the
operation.
 They are not fast anymore. Instead of 5+10=15, now it
takes 16 to complete
 Cycle 8 min a flow unit ActivityAB1
time =
 Capacity =60(2/16) per hr
7.5 per hr Activity AB2
 Theoretical Flow Time 16 16
=
Capacity increased from 6 ActAB1
to 7.5. Therefore, pooling
and cross-training can ActAB2
increase throughput. CT CT CT
We will latter show that
0 16 24 32 40
flow time will also go
down.
Capacity- Basics Ardavan Asef-Vaziri March, 2015 5
 Flow Time; Parallel Tasks

M1 H1 H2 M2
A B C D
Flow Time = 2+2+4+1 = 9
2 2 4 1
Capacity /hr M1 =30, H1=30, H2=15, M2=6
Capacity = 15 per hour

H1 Capacity /min M1 =1/2, 1/2, 1/4, 1/1

B
2 H2
M1 M2
A C D
2 4 1
Path 1 = 2+2+1 = 5
Path 2 = 2+4+1 = 7
Flow Time = 7 Capacity M1 =30, H1=30, H2=15, M2=
Capacity- Basics Ardavan Asef-Vaziri March, 2015 6
Parallel Operations – Resource Pooling &
Splitting Activities
H
Capacity
B M1 =(1/2)60= 30
M1
2 H
M2 M2= (1/1)60 = 60
A C D H= (1+1)/(2+4) = 1/3 per min
4
H=(1/3)60 = 20 per hour
2 1
T = Max{5,7} = 7 Still two machine H
H H
But Operation C is cut in two
B C2
M1 =(1/2)60= 30
M2= (1/1)60 = 60
2 H 1
M1 M2H= (1+1)/(2+1+3) = 1/3 per m
A C1 D H=(1/3)60 = 20 per hour
2 3 1

T = Max{6,6} = 6
Capacity- Basics Ardavan Asef-Vaziri March, 2015 7
 Capacity Capacity
Theoretical Capacity

Flow Time Theoretical Flow Time Very Theoretical Flow Time

Capacity- Basics Ardavan Asef-Vaziri March, 2015 8

Problem 7
The following graph shows a production process for two
products AA and BC. Station D and E are flexible and can
handle either product. No matter the type of the product,
station D can finish 100 units per day and station E can
finish 90 units per day. Station A works only for Product A
and have a capacity of 60 units per day. Station B and C
are only for Product BC and have capacity of 75 and 45
units per day, respectively. The demands for each product
is 50 units per day.
Which station(s) is the
bottleneck?
AA A
A) Stations A and C 60 D E
B) Station B and C 10 90
0
C) Stations C and D
B C
D) Stations D and E BC 75 45
E) Station C and E
Capacity- Basics Ardavan Asef-Vaziri March, 2015 9
Problem 7
If the system can work at the process capacity, which of
the following is NOT true?
A) The utilization of machine A is at least 75%
B) The utilization of machine B at least about 53%
C) The utilization of machine B is at most 60%
D) The utilization of machine D is 90%
E) All of the above.
E  We can produce at most 90 AA and BC.
C  We can produce at most 45 BC
We may produce all combinations from 50AA and 40
A)
BCWe produce
to 45AA andat45
least
BC 45 AA: 45/60 AA = A
60
75% D E
10 90
B) We produce at least 40 BC: 40/75 = 0
53.33% B C
BC
C) 45/75 = 60% 75 45

D) 90/100
Capacity- Basics = 90% Ardavan Asef-Vaziri March, 2015 10
Problem 8
A company has five machines and two products. Product
X will be processed on Machine A, then J, then B. Product
Y will be processed on Machine C, then J, then D. The
demands for both products are 50 units per week. The
capacities (units/week) of the machines are marked in the
graph on the right. Which machine is the bottleneck?
A B
A) A X
50 60
B) B
J
C) C 90
D) D
C D
E) J Y 70 80

Capacity- Basics Ardavan Asef-Vaziri March, 2015 11

Problem 8
Which of the following is true?
A) The utilization of machine A is at least 80%
B) The utilization of machine B at least about 66%
C) The utilization of machine D is at least 50%
D) The utilization of machine C is at most about 72%
E) All of the above.
We can produce at most 90 X and Y. We may produce
all combinations from 50 X and 40 Y to 40 X and 50Y
A B
A) We produce at least 40 X: 40/50
X= 50 60
80%
J
B) We produce at least 40 X: 40/60 = 90
66.67% C D
C) 40/80 = 50% Y 70 80
D) 50/70 = 71.43%
Capacity- Basics Ardavan Asef-Vaziri March, 2015 12
Problem 3: Problem 5.2 book
Kristen and her roommate are in the business of baking
custom cookies. As soon as she receives an order by
phone, Kristen washes the bowl and mixes dough
according to the customer's order - activities that take a
total of 6 minutes. She then spoons the dough onto
a tray that holds one dozen cookies (2 minutes). Her
roommate then takes 1 minute to set the oven and
place the tray in it. Cookies are baked in the oven
for 9 minutes and allowed to cool outside for 5
minutes. The roommate then boxes the cookies (2
minutes) and collects payment from the customer (1
minute). Determine the unit load on the three resources
in the process – Kristen, her roommate and the oven.
Assuming that all three resources are available 8 hours a
day 100% of the time.
Capacity- Basics Ardavan Asef-Vaziri March, 2015 13
Problem 3: Problem 5.2: Flow unit = 1 order
of 1 dozen.
Take Was Spoo load Bak Un Coo Pack
Order hMix n Set e load l 2
6 2 1 9 5
a) Compute the unit load of each resource Pay
Kristen = 6+ 2 = 8 min/unit. 1
Roommate = 1+ 2+1 = 4 min/unit.
Oven = 1+9 = 10 min/unit.
b) Compute the capacity of each resources.
Kristen = 1/8 = per min = 7.5 orders per hour.
Roommate = 1/4 per min = 15 orders/hour.
Oven = 1/10 =per min = 6 orders/hour min.
c) Compute the process capacity.
Capacity = min {7.5, 15, 6} = 6 orders of 1
dozen/hr.
The oven is the theoretical bottleneck.
Capacity- Basics Ardavan Asef-Vaziri March, 2015 14
Problem 3: Problem 5.2
d) Compute utilization at full capacity operation (if
possible).
Kristen = 6/7.5 = 80%
RM = 6/15 = 40%
Oven = 6/6 = 100%.
e) What is the impact of buying another Oven?
Doubles the oven resources pool capacity to 12 orders
per hour.
Oven = 2/10 per min = 12 orders/hour min
Capacity = min {7.5 , 15, 12} = 7.5 orders of 1 dozen/hr.
The bottleneck shifts to Kristen.
Doubling the capacity of oven does not double the
process capacity.
The process capacity is only increased to 7.5 orders per
hour. That is 25% improvement. This is an example of
(1) Basics
Capacity- shift in the bottleneck, (2) Asef-Vaziri
Ardavan diminishing marginal
March, 2015 15
Problem 3: Problem 5.2
f) Lets go back to one oven case. What is the impact of
cross training of Kristen and RM? Cross training
pools Kristen and RM into a single resource pool
The unit(Workers).
load of Worker Resource Pool is 8+4 = 12 min.
per unit.
The capacity of Workers Resource Pool is increased to
2/12 per min. = 10 orders of 1 dozen/hr.
Capacity = min {10 , 6} = 6 orders of 1 dozen/hr.
With one oven, cross training does not affect the
theoretical process capacity. The Oven remains the
bottleneck. The capacity is 6 dozen per hour.
g) Now suppose we have two ovens.
With two ovens, capacity = min {10 , 2*6} = 10 per hr.
The bottleneck shifted to the Workers Resource Pool.
6 + Two Ovens  7.5, 6 + Cross Train  6, 6 + Two
Capacity- Ovens
Basics + Cross Train Ardavan
10. Asef-Vaziri March, 2015 16
Problem 6. Problem 5.4 in the book
A company makes two products, A and B, using a single
resource pool. The resource is available for 900 min per
day. The contribution margins (P-V) for A and B are $20
and $35 per unit respectively. The total unit loads are
10 and company
a) The 20 minutes.
wishes to produce a mix of 60% As and
40% Bs. What is the effective capacity (units per
day)?
An aggregate product will need
0.6(10) + 0.4(20) = 14 minutes
Capacity is 1/14 per minute or 900(1/14) = 64.29 per
day
b) What is the financial throughput per day? Financial
throughput is the rate at which a firm is generating
money.
An aggregate product will Ardavan
Capacity- Basics
generate 0.6(20) + 0.4(35) =17
Asef-Vaziri March, 2015
What is a Process
Process analysis is the Identify Define Document
detailed understanding opportunity
1
scope
2
process
3
and documentation of
how work is performed
and how it can be Implement Redesign Evaluate
changes process performance
redesigned and 6 5 4
improved.

 Capacity Metrics: Capacity, Time to perform the process

(Unit Load; Tp)
 Quality Metrics: Defective rate, Customer satisfaction
rate
 Efficiency Metrics: Cost, Productivity, Utilization
 Flexibility Metrics: Setup time, Cross Training

Capacity- Basics Ardavan Asef-Vaziri March, 2015 18