Herman Bautista
9/25/2013

Discussion Question
Chapter 7
Process Flow Analysis

1. Provide the definition of a bottleneck. Why is it important to find the bottleneck?

A bottleneck is a phenomenon where the performance or capacity of an entire system is limited by a single or limited number of components or resources. The term bottleneck is taken from the 'assets are water' metaphor. As water is poured out of a bottle, the rate of outflow is limited by the width of the conduit of exit, that is, bottleneck. By increasing the width of the bottleneck one can increase the rate at which the water flows out of the neck at different frequencies. Such limiting components of a system are sometimes referred to as bottleneck points.

2. Explain the difference between capacity, flow rate, and demand.

Capacity: The capacity can be calculated for every station in a business process. It is always m / processing time with m being the number of resources being devoted to the station. If, for example, one worker needs 40 seconds to put together a sandwich, the capacity of this station is 1/40 per second or 1,5 sandwiches per minute. If there are two workers on the same station, the capacity increases to 2/40 per second or 3 sandwiches per minute.

Flow rate: the definition needs to be augmented as the flow rate being the minimum of demand and process capacity. While the flow rate logically can never be higher than the capacity of the bottleneck, it can very well be lower, if the demand is insufficient.

Demand: principle that describes a consumer's desire, willingness and ability to pay a price for a specific good or service. Demand refers to how much (quantity) of a product or service is desired by buyers. The quantity demanded is the amount of a product people are willing to buy at a certain price; the relationship between price and quantity demanded is known as the demand relationship.

3. What is the best approach, radical improvement or continuous improvement of processes? Under what circumstances might either approach be preferred?

Continuous improvement: is an ongoing effort to improve products, services or processes. These efforts can seek “incremental” improvement over time or “breakthrough” improvement all at once.

Among the most widely used tools for continuous improvement is a four-step quality model—the plan-do-check-act (PDCA) cycle, also known as Deming Cycle or Shewhart Cycle:

Plan: Identify an opportunity and plan for change.
Do: Implement the change on a small scale.
Check: Use data to analyze the results of the change and determine whether it made a difference.
Act: If the change was successful, implement it on a wider scale and continuously assess your results. If the change did not work, begin the cycle again.
Other widely used methods of continuous improvement — such as Six Sigma, Lean, and Total Quality Management — emphasize employee involvement and teamwork; measuring and systematizing processes; and reducing variation, defects and cycle times.

Radical Improvement: A method of reducing a process that may usually take months to happen, to make it happen in a much shorter period of time. An acceleration process that is sued in times of lean production.

4. Describes services blue printing.

In service operations flowcharting is called blue printing. In this chart we can see how the customers and services providers interact which each others in every step of the service delivering process.