Flow Time Analysis (Ch 4 of MBPF)

1
Flow Time Analysis (Ch 4 of MBPF)

• And a cautionary tale

2
Flow Time Analysis
Inputs
Outputs
Processing System
Flow time processing time wait time (total
time in the box)
T
Theoretical Flow Time is the time to process a
typical flow unit assuming NO waiting.
3
Flow Time Analysis

• Total amount of time for a flow unit to flow from
  the entry to exit point of a process
• Includes delays and work
• Includes value added and NVA activities
• Shortening flow time often good
• Decrease response time (Dell computer)
• Reduce inventory (less tied up in WIP)
• New product/service development (auto)
• Robust to short product life cycles
• Fast feedback on quality problems
• An indicator of overall process excellence

4
Process Flow Charting

• Flow charts are graphical representations of
  processes
• May capture inputs, outputs, activity network,
  resources used, locations visited, decisions or
  business logic, buffers and delays
• Many tools available, well use iGrafx Process as
  it is bundled with our MBPF text
• Very good flow charting engine
• Numerous templates for various kinds of common
  business diagrams
• Also has a relatively easy to use and pretty
  powerful process simulation capability. We will
  use this.

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To learn iGrafx Process, start by doing the
Tutorial on Creating Process or Swimlane
Diagram which you can find in the iGrafx
Tutorials menu or iGrafx Help menu. This tutorial
does NOT cover the simulation features of iGrafx
but instead just gets you started building
process diagrams. Well learn the simulation
features as we move along in the semester.
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Process Flow ChartsUsing PowerPoint or iGrafx
Process
Wait/ Buffer
Activities/Subprocesses
Start/End Events
Decision
Use AutoShape - Flowchart
Use connection tool
Activity Precedence
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Old Medical Transcription Process

• Diagnosis
• Plan of care

Physician dictates into tape recorder
Start Exam
Physician reviews report
Print Report
Transcribe into word processor
Wait
Wait
yes
Changes?
Send report to medical records dept.
End Process
no
8
Subprocesses and Cascading
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Process Flow Charting in Practice

• Multi-disciplinary team
• Have each team member do own flow chart
• Why?
• Group facilitator or group tries to reach
  consensus on process flow chart
• Yellow sticky notes
• Examine and revise by group
• Examine parts
• Dont get buried in details
• Genuine disagreement may occur
• More flow charting resources
• A Fresh Look at Flow Charting
• http//www.q-skills.com/flowchrt.html
• Flow Charting Help Page
• http//home.att.net/dexter.a.hansen/flowchart/flo
  wchart.htmDefinition
• Flow Chart Overview
• http//deming.eng.clemson.edu/pub/tutorials/qctool
  s/flowm.htm

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Other Process Description Tools

• Swim lanes or Service System Maps
• Enhanced flow charting technique using bands to
  delineate department participation in process
  steps
• Variants can use color or other features to
  represent more process information
• iGrafx Processes are of this type
• Process Activity Charts
• See next slide and Excel file ProcessActivityChart
  .xls

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Example X-ray
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Finding Theoretical Flow Time Sequential Process
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Finding Theoretical Flow Time Sequential
Parallel
Path 1 1-3-5-7-8 (T180)
Path 2 1-2-4-6-7-8 (T290)
T is the length of longest path through the
process The path associated with T is called the
Critical Path Activities on the Critical Path are
called Critical Activities
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Finding the Critical Path

• If process is simple, we can
• enumerate all the possible paths
• Calculate their length
• Find the longest path
• If process is complex, may be too many paths to
  enumerate
• Various algorithms exist for this
• See Appendix of Chapter 4 in MBPF for Critical
  Path Method
• Same method as used to find critical path in
  project management networks (e.g. MS Project)

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Observations about Critical Path

• Delaying an activity on CP will increase T
• Activities NOT on CP can be delayed to some
  degree without increasing T
• Speeding up activities on the CP will decrease T
• Speeding up activities NOT on the CP will NOT
  decrease T
• The CP can change as we change the activity times
• We are still assuming the activity times are
  known deterministic quantities (no randomness)

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Flow Time MeasurementThe Direct Method

• Observe the process over some specified, extended
  period of time
• Take random (or exhaustive) sample of flow units
• Calculate flow time, T, for each by (tend
  tstart)
• Calculate average T over sampled flow units
• Example CalcFlowTime.xls

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Flow Time MeasurementThe Indirect Method

• Observe the process over some specified, extended
  period of time, t
• Measure number of flow units, N, processed over
  the time period, t
• Compute throughput, RN/t
• At random points in time, count the number of
  flow units in process. Compute the average of
  these counts (well call it I)
• Use Littles Law to estimate TI/R

Lets revisit CalcFlowTime.xls
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Actual Flow Time vs. Theoretical Flow Time

• Most processes have numerous delays
• Estimate avg. delay times and treat as activities
• Value added vs Non-value added activities
• See Example 4.7 (p86) for X-ray process example
• Problem 4.1 in MBPF

T 55
TA 70
Flow Time Efficiency T/TA 55/70 .786
Many real processes have very low Flow Time
Efficiency
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Levers for Managing Theoretical Flow Time

• We are ignoring waiting/delays for now
• Three broad methods for reducing T
• Eliminate Reduce work content of a critical
  activity
• Work in parallel Move some work content off of
  the critical path
• Select Modify the product mix

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Eliminate

• Roots in scientific management and industrial
  engineering
• Some combination of
• Eliminate NVAs (work smarter)
• Classic BPR example Ford Accounts Payable
• Reduce repetitions of task (less rework)
• Build quality into process (poke-yoke)
• Statistical process control
• Design for manufacturability
• Workforce training
• Increase speed (work faster)
• Incentives
• Better technology
• More resources

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Work in Parallel

• Move work off CP to non-critical activity
• Move work off CP to outer loop
• Pre or post processing
• Examples pre-authorization, pre-admission
  testing, pre-registration
• Usually requires process redesign
• Often some enabling communications technology
  required to facilitate parallel work
• Example concurrent engineering facilitated by
  CAD and high bandwidth networks allowing
  transfer/sharing of large electronic files

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Reengineering/Redesign
The fundamental rethinking and radical redesign
of business processes to achieve dramatic
improvements in critical contemporary measures of
performance such as cost, quality, service and
speed.
Reengineering the Corporation, Hammer and Champy,
Harper Business (1993)
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Process Reengineering A 1st Look

• Radical rethinking/redesign of processes
• Clean sheet of paper
• Benchmark best practices
• Commitment from top leadership
• Question unconscious assumptions
• Value added vs. Non-value added activities

• Why redesign business processes?
• How to go about redesign?
• What is role of information technology?
• Relationship to continuous improvement, total
  quality management?
• Isnt reengineering just another word for layoffs
  and downsizing?

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BPR Life Cycle

• Process Analysis
• Idea Generation
• Establish a goal and Define Scope
• Generate Strategies
• Evaluate and Select
• Design and Implement
• Sustain

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Why Redesign?

• Current process broken (or may not exist)
• No one seeing big picture
• No one questioning business assumptions
• Incremental improvement efforts insufficient
• Go beyond perspective of how we do things
• Processes critical to business success

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Classic Reengineering Principles

• Organize around outcomes, not tasks
• Have output users do the process
• Treat geographically dispersed resources as
  though they were local
• Link parallel activities instead of integrating
  results
• Put decision point where work performed and build
  control into the process
• Capture information once, and at the source

Reengineering Work Dont Automate, Obliterate,
Hammer and Champy, Harvard Business Review
(July-Aug 1990)
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IHI Redesign the System (p42-53)

• Do tasks in parallel info gather during waits
• Use multiple processes ED fast track
• Minimize handoffs reduce unit transfers
• Synchronize surgery starts at incision
• Use pull systems pull asthma from ED to clinic
• Move steps closer together registering ED
  patients in treatment area
• Use automation - PACS
• Consider people to be the same system
  self-scheduling of surgery by surgeon office
• Use multiple processing units increase staffing
• Extend the time of specialists nurse aide
• Convert internal steps to external outsource
  transcription

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The 5-step BPR Framework

• Develop the Business Vision and Process
  Objectives
• Identify the Processes to be Redesigned
• Understand and Measure the Existing Process
• Identify IT Levers
• Design and Build a Prototype of the New Process

The New Industrial Engineering Information
Technology and Business Process Redesign,
Davenport and Short, Sloan Management Review
(Summer 1990)
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The Fad That Forgot People
Reengineering didnt start out as a code word for
mindless bloodshed. It wasnt supposed to be the
last gasp of Industrial Age management. I know
because I was there from the beginning. I was one
of the creators.
The Fad That Forgot People, Davenport, T.H., Fast
Company, November 1995.
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BPR What Happened?
The Fad That Forgot People, Davenport, T.H., Fast
Company, November 1995.

• Started as real people with real problems
• Ford Motor Co., Mutual Benefit Life, HP
• Synthesis of 3 concepts
• Technology
• Business processes
• Clean-sheet-of-paper approach
• Companies did stuff, academics and consultants
  started to model make
• Davenport, Hammer and Champy wrote bible
  articles and books

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The Feeding Frenzy
The Fad That Forgot People, Davenport, T.H., Fast
Company, November 1995.

• Top managers big-time consultantsIT vendors
  
• Early successes were trumpeted
• Projects labeled BPR
• People always looking for magic solution
• Consultants started packaging BPR services
• Big contracts
• Executives needed to justify spent
• Layoffs quickest way to realize savings
• IT firms selling hardware, software AND
  reengineering consulting

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Reality Bites
The Fad That Forgot People, Davenport, T.H., Fast
Company, November 1995.

• Massive layoffs labeled reengineering
• Alienation of good employees
• Treated as interchangeable cogs in corp. machine
• 25 yr old MBAs making 80K as BPR experts
• Major project failures
• Consultants start repositioning for next wave
• And sell BPR to rest of the world

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The Good Stuff
The Fad That Forgot People, Davenport, T.H., Fast
Company, November 1995.

• Focus on business processes
• IT only useful if it helps people do work
• A Lesson The bigger the hype, the greater the
  chances of failure.
• Techniques and tools of BPR can still be useful

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The Next Big Thing
The Fad That Forgot People, Davenport, T.H., Fast
Company, November 1995.

• Remember the lessons of BPR
• Dont drop all your current approaches for the
  handsome newcomer
• Dont listen to most charismatic advocates,
  listen to most reasoned advocates
• Talk softly
• Carry big ruler to measure real results

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Defining Characteristics?

• Statistical process control
• Total quality management
• Business process reengineering
• Theory of constraints
• Lean production methods
• 6-Sigma
• Lean/6-Sigma
• Operations research management science

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Process Capacity

• Recall flow basics
• Rflow rate
• Tflow time
• Ooccupancy
• Process capacity Maximum sustainable flow rate
  of a process
• A resource pool is a set of interchangeable
  resources

O RT (Littles Law)
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How capacity gets used
Idle
Time
Unavailable
Busy
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Find the bottleneck
T16 mins
T22 mins
C1 2 units
C2 1 units
R1 2 / 6 0.333 pats/min 20 pats/hr
R2 1 / 2 0.5 patients/min 30 pats/hr
Bottleneck is first activity.
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Finding the Bottleneck Not Easy

• Complex business processes make finding
  bottlenecks far from easy
• Process improvements can shift the bottleneck
• GM and the C-More story

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Problem 3.4 ER Flow Chart

• Read Problem 3.4 on p69
• This is first problem on HW3
• Lets draw the flow chart in iGrafx Process