Chapter 4

Balancing for a fixed sequence of activities requires that activities are carried out in a certain order. True or False?

True

For a process that is capacity constrained, the idle time of the bottleneck will be zero. True or False?

True

When staffing to meet demand yields a process with idle time, the staffing level will be higher than the target manpower. True or False?

True

What are the benefits of specialization?

-reduction in processing times due to elimination of setups -reduction in processing times due to learning -lower-skilled labor -equipment replication (too many cooks in the kitchen)

How do we compute the cost of direct labor?

Cost of direct labor = Wages per unit of time/ Flow Rate

When cycle time is greater than takt time, supply exceeds demand. True or False?

False

An efficient process is one in which the average labor utilization is as low as possible, true or false?

False; the average labor utilization should be as high as possible

Idle time across all employees is called...

total idle time

What type of cost increases with the number of units sold?

variable cost

What is a key characteristic of a motivating work environment?

variety in activities

If takt time is less than cycle time, then we (are/are not) satisfying demand?

we are not satisfying demand if takt time is less than cycle time

List some measures of labor efficiency

-cost of direct labor -labor content

List some ways you can off-load the bottleneck?

-line balancing -automating some activities -outsourcing some activities

How do you calculate cycle time?

1 / Flow rate

The target manpower calculation implicitly assumes that all resources are utilized at _____%?

100%

If a customer orders a sandwhich every 36 seconds, our goal should be to make a sandwhich every....

36 seconds

How do you calculate the average labor utilization based on cycle time?

Average labor utilization = (labor content / # of employees content / cycle time

How do you calculate the average labor utilization based on idle time?

Average labor utilization = labor content / labor content + idle time

To increase the capacity of a process by adding staffing, you should first add staff to the ______resource.

Bottleneck

What is the Manpower Formula?

Target manpower = labor content / takt time

What is a work cell?

a small group of employees perform a job from beginning to end

Within a process, one station (resource) that performs at 1/37 (one customer per 37 seconds) is the...

capacity of that resource

Cycle time should be as (close/far) from the takt time as possible?

close

How do you balance for a fixed sequence of activities?

compute the takt time, add activities to each resource as long as it stays under a certain takt time, then proceed to the next resource until all activities are assigned

The Target Manpower Formula does what?

computes the required staffing level

The labor cost associated with serving one customer is referred to as...

cost of direct labor

What is the difference between takt time and cycle time?

cycle time depends on process capacity while takt time depends on demand rate

Being able to line balance without having to observe a fixed sequence will (increase/decrease) the cost of direct labor.

decrease

If variable costs go up, then the margin will (increase/decrease)?

decrease

When idle time goes up, average labor utilization...

decreases

The takt time increases when...

demand quantity goes down

Our goal is to design a process flow that ...

exactly meets this demand rate.

What type of cost must be payed regardless how much we produce/sell?

fixed cost

Profits = Flow Rate (Average price - variable cost) -

fixed costs

What is idle time?

the time we pay a resource, but the resource is not working

When all resources are utilized at 100%, that means ...

there is no idle time in the process

As idle time goes up, the cost of direct labor...

goes up

The higher the desired capacity at a resource, the (higher/lower) the target manpower.

higher

Balancing for activities with no fixed sequence gives you a bit more flexibility, resulting in...

higher average labor utilization and lower cost of direct labor

List some examples of appropriate units for staff time?

hours/customer; seconds/burger

How do you compute the idle time for a resource?

idle time (Resource i) = cycle time - processing time (Resource i)

The benefits of specialization must be weighed with the costs of specialization, one of which is...

increased idle time

Raising the staffing level will do what to the cost of direct labor?

it depends

The bottleneck contributes the (least/most) to total idle time?

least

Setting an expected demand rate for a given period of time is referred to as a ______the demand

leveling

The more a resource is idle, the (higher/lower) its utilization.

lower

When there is a fixed sequence of activities, labor utilization is typically (higher/lower) than where there is no fixed sequence?

lower than where there is no fixed sequence

More takt time requires (more/less) employees to handle the same amount of labor content.

more

By automating some of the activities consuming time at the bottleneck, you are employing what strategy?

off-loading the bottleneck

What is the improvement strategy of moving work away from the bottleneck referred to?

off-loading the bottleneck

What is line balancing?

reassigning activities to resources with more capacity

If a process is demand constrained, what should you focus on to improve profits?

reducing fixed costs, reducing variable costs

How do you use leveling the demand to figure out how to staff demand?

set an expected demand rate for a given period of time; turn that leveled demand into takt time; translate takt time into staffing level

Disruptions in a process are referred to as

setup times

More demand means (shorter/longer) takt time?

shorter

Why did Adam Smith observe rapid flow in the pin factory?

specialization

As process capacity increases, take time.....

stays the same

How do you calculate labor content?

sum of the processing times involving labor

A measure that is entirely driven by demand is called...

takt time

How do you calculate takt time?

takt time = available time / required quantity

When quantity demanded goes up, takt time (increases/decreases) and target manpower (increases/decreases)?

takt time decreases; target manpower increases

What is labor content?

the amount of work required in serving one flow unit

In the context of process analysis, what does efficient mean?

the highest flow rate is achieved with the least amount of resources

What does it mean when a manager "levels the demand"

the manager sets an expected demand rate for a given period of time (i.e. one hour at a Subway restaurant)

How do you calculate flow rate?

the minimum of demand and process capacity

How do you calculate the utilization of a resource?

the ratio between its flow rate and its capacity