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SMG OM 323 Chapter Notes - Chapter Online: Queueing Theory, Exponential Distribution, Poisson Distribution

Operations & Technology Management
Course Code
SMG OM 323
Justin Ren

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Process Analysis
Process: a means for converting various inputs (land, labor, capital, information) into
outputs (goods and services)
Work center: people and/or equipment that perform a task
Setup time: time to prepare or clean-up for the task; independent of the # of jobs in the
Run time: time required to perform the task
Time standards: the expected amount of time to perform a task
Throughput time: time for each unit to pass through the process, including waits
Cycle time: time between job completions; the rate at which items are produced
Capacity: the ability to process work; expressed in units of output or time
o Logan airport: landings / takeoffs per day
o HMO doctor: hours per week
o Ford plant: cars
Bottleneck: the work center with the least capacity; limits system capacity (i.e., defines
the cycle time)
Balance: when capacities of different work centers are similar
Yield: percent of good items ( = output quantity / input quantity )
Scrap rate: percent of bad items ( = 1 yield )
Idle Time: 1- System Utilization
Waiting Lines
Waiting lines occur in all sorts of service systems
Wait time is non-value added
o Wait time ranges from being acceptable to being a matter of life and death
o Short waits in a drive-thru
o Sitting in an airport waiting for a delayed flight
o Waiting for emergency service personnel
Waiting time costs
o Lower productivity
o Reduced competitiveness
o Wasted resources
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