8009

OCTOBER 18, 2013

REVIEW QUESTIONS

PROCESS ANALYSIS
INSTRUCTIONS FOR PROFESSORS:

This set of review questions and answers is delivered in an editable format. This will allow
you to present any number or combination of review questions to your students for
individual study, examination purposes, or classroom discussion. Part I contains the entire
set of review questions, while Part II presents the same questions accompanied by their
answers. Feel free to copy and paste this content into your own classroom materials, editing
as you see fit for difficulty level and course teaching objectives.

I. Assignment Questions for Students

NOTE: For the following exercises, in order to make your calculations as straightforward as
possible; please assume unless stated otherwise that:

1. There are sufficient parts or raw materials so initial operations are never starved.
2. Except as noted, processing times have negligible variability, and over time, workers
neither speed up nor slow down, but work always at the processing rates given.
3. There are no machine breakdowns or maintenance.

________________________________________________________________________________________________________________
These review questions were prepared by HBS Professor Roy D. Shapiro for the sole purpose of aiding classroom instructors
in the use of Core Reading: Process Analysis (HBP No. 8007). HBP Core Readings are developed solely as the basis for class
discussion. HBP Core Readings are not intended to serve as endorsements, sources of primary data, or illustrations of
effective or ineffective management.

Copyright 2013 Harvard Business School Publishing Corporation. All rights reserved.

Harvard Business Publishing is an affiliate of Harvard Business School.

 4. When there are buffers shown, they are large enough to accommodate any amount of
WIP that would reside in those buffers under normal operations, but they are not infinite
in size.
5. Travel time and time to transport parts from one operation to another is negligible.
6. All operations run with 100% yield, i.e., the operations produce no defective units.
7. All processes are in steady state; thus, you may ignore any start-up effects.
8. Assume strict batch flow discipline. That is, batches cannot be split among two or more
different workstations (even if the workstations do the same thing). Each batch is
processed through one step completely before advancing to the next step.

Part A
Consider the following process. All Steps (A, B, C, D, and E) are necessary to create each
finished unit. Each step employs a single worker. Task times are shown for each step.

1. What is the fastest a rush order for one unit can go through the process?

2. Working eight hours a day, what is the daily capacity of the process?

3. During the day, what is the average labor utilization of the five workers?

For the next problem, suppose buffers have been provided before Steps C, D, and E, but
need not be used.

8009 Review Questions: PROCESS ANALYSIS 2

4. To minimize average throughput time, in steady state, how would you run this process?
a. So that the buffers were empty
b. So that all the WIP was in the first buffer
c. So that all the WIP was in the second buffer
d. So that the WIP was split between the first and second buffer
e. Dont have enough information to answer this question

For the next three problems, consider hiring another worker and duplicating Operation D
as shown in the diagram below (no buffers). The two workers work on Successive products;
they never work on the same product at the same time. The product still requires the five
Steps (A, B, C, D, E).

5. What is the fastest a rush order of one unit can go through the process?

6. Working 8 hours a day, what is the daily capacity of the process?

7. What is the labor content of a unit?

Part B
Consider the following three-step worker-paced line:

Each step employs a single worker who is not cross-trained for any other step. The set-
up represents the amount of time the worker spends setting up the machine for each
order. No units can be processed on a machine while it is being set up. The run time
represents the amount of time it takes the worker to process a single unit. When a worker
completes an order, he or she hands it off to the next stage.

8. If only 10-unit orders are produced, what is the average capacity of the process per 8-hour
day?

8009 Review Questions: PROCESS ANALYSIS 3

9. At what order size does the bottleneck move? That is, at what order size are there two steps
that are both bottlenecks?

Part C
Consider a five-workstation, worker-paced line, with five manual tasks to be performed
before the product is completed, as diagrammed below:

The times shown are the times, in minutes, that it takes one worker to perform that task
for one unit of product.

This line is staffed with six workers, two of whom are assigned to Workstation D. For the
next three questions, assume that each of the Tasks A through E are never split among
multiple workers. Thus, the two workers doing Task D work on every other unit, each doing
all of Task D on the particular unit on which he or she is working. (Assume there is ample
equipment so that all workers can perform their tasks).

10. What is this lines capacity in an eight-hour day?

11. What is the direct labor content per unit (in minutes)?

12. Assume that there are only two costs: each worker receives wages of $10 per hour, and
material cost is $15 per unit. Every unit produced generates $36 in revenue; assume that
every unit produced can be sold. In steady state, what is the average contribution (revenue
- costs) per unit?

For the next two questions, assume that the line is designed so that workers can move
around freely, with no time to go from one step to another, and doing their tasks in the
allotted time without getting in each others way. Assume that ample equipment is available.

13. One of the two workers assigned to Task D is equally competent at Task C, and it is
decided that this worker will work on both Tasks C and D. (i.e., one worker is assigned to C,
one worker is assigned to D, and one worker moves between C and D.) This third worker
moves between C and D so as to maximize the output of the process. What is this lines
maximum output rate, in units per eight-hour day?

14. (This question builds on the assumptions in Question 13.) Management is contemplating
adding a seventh experienced senior worker, as a floater, to this line. This worker is fully
trained to do any of the five tasks, and would move around freely, doing whatever was best
to maximize the output of the process. What would then be the lines maximum output rate,
in units per eight-hour day?

8009 Review Questions: PROCESS ANALYSIS 4

 Part D
At a local business school, there is a toasted submarine sandwich process that uses a
conveyor-fed oven. Zeynep is the sole operator of the sub making process. In the first step
of the process, she spends 2 minutes putting various ingredients in the sub. Then, she puts
the sub on a conveyor belt and, over a period of 12 minutes, the conveyor moves the sub
from the beginning of the oven to the end of the oven, fully toasting it. After the sub comes
out of the oven, Zeynep spends 1 minute slicing the sandwich and putting it in a box. At
most, 5 subs can fit in the oven at once. The toasting time in the oven does not depend on
the number of subs in the oven.

load slice and

ingredien box
ts 12 min
2 min/sub 1
(oven)
(Zeynep) min/sub
15. What is the hourly capacity of this sub making process? (Zeynep)

16. What is the labor utilization?

Suppose another employee is hired to do the slicing and boxing, and Zeynep now only
loads the subs with the right ingredients:

17. What is the hourly capacity of this process with the additional employee?

18. What is the labor utilization of the two employees?

Part E
A factory makes womens blouses in a traditional batch flow process. Making one of
these blouses requires five distinct sewing operations that must be done in sequence. There
are no set ups. The first two of these operations each take two minutes per blouse; the third
and fourth each require one minute per blouse; and the fifth operation requires three
minutes per blouse. Any of these five operations can be done on any sewing machine in the
factory.

19. In the traditional batch flow process, blouses are sewn in batches of 100. A batch moves
to the next operation only when the operator has completed the entire batch. In this batch
flow process, in steady state, what is the minimum throughput time for a batch to complete
all five operations?

20. In the traditional batch flow process, the factory has 70 workers and has been producing
an average of 37.3 batches per 480-minute shift. On average, each worker has 2 batches at
his/her station (working on one and with one batch waiting). What is the average
throughput time for a batch?

Management decided to create a new experimental cell for a certain family of similar
blouses. The new cell was set up with five fully cross-trained workers and five general
purpose sewing machines. A material handler is assigned to bring batches of 100 blouses to
the cell as needed, and take them away when completed. As one batch was being

8009 Review Questions: PROCESS ANALYSIS 5

 completed, workers immediately began the next batch. Workers shifted tasks (operations) to
prevent bottlenecks and to avoid idle time. There was sufficient room between operations
for work-in-process inventory.

21. After running this new cell for a while, the company observes that cross-trained workers
need roughly 10% more time to do their tasks than workers in the traditional batch-flow
environment. What is the output rate of this 5-person cell in an 8-hour day?

22. For this process, what is the minimum throughput time of a batch?

Part F
23. In a process with no setups, to calculate the labor cost per unit, you would always
multiply the labor content by the labor wage.
a. True
b. False

24. In a sequential (in-series) process with one bottleneck, which of the following measures
of operating performance is NEVER affected by changing the cycle time of the bottleneck?
a. capacity
b. process cycle time
c. throughput time
d. direct labor content
e. all of the above may be affected

25. For a 4-step in-series process that requires each step to be set up before each batch, and
that maintains strict batch flow discipline (i.e., batches are never split), which of the
following statements is true?
a. The bottleneck will never shift from one operation to another as batch sizes
change.
b. The bottleneck may shift from one operation to another as batch sizes
change, but will always be at one of two operations.
c. The bottleneck may shift from one operation to another as batch sizes change, but
will always be at one of three operations.
d. The bottleneck may shift from one operation to another, and may, for different
batch sizes, be at any of the four operations.
e. None of the above.

Part H
Below are two charts that depict the buildup of work-in-process inventory in two different
processes.

8009 Review Questions: PROCESS ANALYSIS 6

 A B

WIP (Units) WIP (Units)

0 2 4 6 8 10 0 2 4 6 8 10
Hours Hours

26. What is the output rate for Process A?

27. Which process has the greater average WIP?

28. Assume that both processes have the same average output rate during the period
studied. Which one has the longer average throughput time (TPT)?

Part I

Van Overmars Diamond Company, based in Holland, takes large, rough stones and
produces finished diamonds for use in jewelry, using the process shown in the figure above.
Stones are first taken from inventory and inspected. During inspection, 20% of the rough
stones are discovered to be double crystals, from which two diamonds can be produced.
Such stones are cleaved and sawn into two stones. Both of these then pass on to the
rounding step. The remaining 80% of rough stones pass directly from inspection to the
rounding step. Labor times for each step are also shown in the figure above. Assume there
is one person at each process step (six people in total), and that there is room for a small
amount of work-in-progress throughout.

29. What is the cycle time for diamonds coming out of the process?

8009 Review Questions: PROCESS ANALYSIS 7

30. What is the labor content to complete a finished diamond (on average)?

31. Assume that new technology decreases polishing time to 20mins/diamond. How many
diamonds can the line now produce in an 8-hour day?

32. Assume that polishing is back to its original rate of 40mins/diamond. Assume also that
20% of diamonds fail inspection, and thus need to be re-polished and re-inspected. What is
the new cycle-time of the process?

II. Assignment Questions and Solutions

NOTE: For the following exercises, in order to make your calculations as straightforward as
possible; please assume unless stated otherwise that:

1. There are sufficient parts or raw materials so initial operations are never starved.
2. Except as noted, processing times have negligible variability, and over time, workers
neither speed up nor slow down, but work always at the processing rates given.
3. There are no machine breakdowns or maintenance.
4. When there are buffers shown, they are large enough to accommodate any amount of
WIP that would reside in those buffers under normal operations, but they are not infinite
in size.
5. Travel time and time to transport parts from one operation to another is negligible.
6. All operations run with 100% yield, i.e., the operations produce no defective units.
7. All processes are in steady state; thus, you may ignore any start-up effects.
8. Assume strict batch flow discipline. That is, batches cannot be split among two or more
different workstations (even if the workstations do the same thing). Each batch is
processed through one step completely before advancing to the next step.

Part A
Consider the following process. All steps (A, B, C, D, and E) are necessary to create each
finished unit. Each step employs a single worker. Task times are shown for each step.

1. What is the fastest a rush order for one unit can go through the process?
ANSWER

8009 Review Questions: PROCESS ANALYSIS 8

 We assume for a one-unit rush order that it will never be blocked as it moves from process
to process. Since the unit can move through step A faster than through the parallel Step B,
the front will have to wait for its companion back coming out of step B, so the fastest time
for a rush order is:
10 min + 4 min + 12 min + 5 min = 31 min.

2. Working eight hours a day, what is the daily capacity of the process?
ANSWER

The longest cycle time of this process is 12 min/unit of Process D. Therefore the daily
capacity of this process is: (8 hrs/day*60 min/hr)/12 min/unit = 40 units/day.

3. During the day, what is the average labor utilization of the five workers?
ANSWER

Average utilization for the five workers is labor time used to produce one unit divided by the
labor time available to produce one unit. Labor time used (labor content) is the sum of the
times of each of the process steps: 5 min + 10 min + 4 min + 12 min + 5 min = 36 min.
Labor time available in a cycle is (the cycle time of the process)*(the number of workers) =
12 min*5 workers = 60 min. Utilization is therefore 36/60=60%.

For the next problem, suppose buffers have been provided before Steps C, D, and E, but
need not be used.

4. To minimize average throughput time, in steady state, how would you run this process?
a. So that the buffers were empty
b. So that all the WIP was in the first buffer
c. So that all the WIP was in the second buffer
d. So that the WIP was split between the first and second buffer
e. Dont have enough information to answer this question

ANSWER

Answer = (a)

8009 Review Questions: PROCESS ANALYSIS 9

 By Littles Law, all else equal, the average throughput time increases with WIP. Thus, youd
want to run this process with everyone working on a 12-minute cycle, and nothing in the
buffers. Note that theres no benefit (e.g., in output) in using the buffers anyway.

For the next three problems, consider hiring another worker and duplicating Operation D
as shown in the diagram below (no buffers). The product still requires the five steps (A, B, C,
D, E).

5. What is the fastest a rush order of one unit can go through the process?
ANSWER

A one-unit rush order still requires each of the four process steps. Although Process D is
duplicated, one unit still requires 12 minutes to be processed.

6. Working 8 hours a day, what is the daily capacity of the process?

ANSWER

At D, 2 units can be processed in 12 minutes, so the average cycle time is 6 minutes. The
bottleneck process has thus shifted to process B at 10 min/unit. The daily capacity is:
(8hrs/day*60min/hr)/(10min/unit)=48 units/day.

7. What is the labor content of a unit?

ANSWER

The amount of labor to produce each unit remains the same even though we can process
them at a faster rate. So the labor content remains 36 minutes.

Part B
Consider the following three-step worker-paced line:

8009 Review Questions: PROCESS ANALYSIS 10

 Each step employs a single worker who is not cross-trained for any other step. The set-
up represents the amount of time the worker spends setting up the machine for each
order. No units can be processed on a machine while it is being set up. The run time
represents the amount of time it takes the worker to process a single unit. When a worker
completes an order, he or she hands it off to the next stage.

8. If only 10-unit orders are produced, what is the average capacity of the process per 8-hour
day?
ANSWER

The cycle time of Step 1 is 30 + 2(10) = 50 minutes

The cycle time of Step 2 is 50 + 3(10) = 80 minutes
The cycle time of Step 3 is 40 + 5(10) = 90 minutes
Thus the bottleneck is Step 3, with 10 units every 90 minutes or 53.3 units every 480
minutes (8-hours)

9. At what order size does the bottleneck move? That is, at what order size are there two
steps that are both bottlenecks?
ANSWER

The step with the slowest set-up time is Step 2. The step with the slowest run-time is Step
3. Thus, the bottleneck switches between Steps 2 & 3 depending on order size. Let x =
order size. The breakeven calculation is then: 50 + 3x = 40 + 5x. Thus, x = 5.

Part C
Consider a five-workstation, worker-paced line, with five manual tasks to be performed
before the product is completed, as diagrammed below:

The times shown are the times, in minutes, that it takes one worker to perform that task
for one unit of product.

This line is staffed with six workers, two of whom are assigned to Workstation D. For the
next three questions, assume that each of the Tasks A through E are never split among
multiple workers. Thus, the two workers doing Task D work on every other unit, each doing
all of Task D on the particular unit on which he or she is working. (Assume there is ample
equipment so that all workers can perform their tasks).

8009 Review Questions: PROCESS ANALYSIS 11

10. What is this lines capacity in an eight-hour day?
ANSWER

With two workers at D, on average two units could be produced every fifteen minutes, so Ds
cycle time is 7.5 minutes. The bottleneck task is thus C, and the process cycle time is thus
12 minutes per unit. The capacity in 480 minutes is 480/12 = 40 units.
The every other unit specification simply means that both workers cant work on a single
unit (which, in many settings, would be difficult), but they can (and will) work in parallel.
I.e., this is exactly like questions 5-7.

11. What is the direct labor content per unit (in minutes)?
ANSWER

In contrast to the answer to question 10, to determine direct labor content, we have to take
a products eye view of the process. In particular, each unit of product sees only one of
the workers at D, and the time spent on it at D is 15 minutes. Thus, the direct labor content
is
6 + 9 + 12+ 15 + 9 = 51 minutes.

12. Assume that there are only two costs: each worker receives wages of $10 per hour, and
material cost is $15 per unit. Every unit produced generates $36 in revenue; assume that
every unit produced can be sold. In steady state, what is the average contribution (revenue
- costs) per unit?
ANSWER

During each twelve-minute cycle, the process produces one unit of product, which will earn
$36 in revenue and incur $15 in material cost. The wage rate during the twelve-minute
cycle (one-fifth of an hour), at $10 per hour, is $2.00, but we have to pay 6 workers, so the
total labor cost per cycle is $12.00. The contribution per unit is thus $36-$15-$12 = $9.
An alternative (and equivalent) approach is, rather than looking at one cycle, to look at, say,
an hour or a day. 40 units are produced each day, earning $36*40 = $1440 in revenue, at a
material cost of $15 * 40 = $600. The labor cost for six workers working eight hours each is
$480. Thus the hourly contribution is $1440 - $600 - $480 = $360 for 40 units, or $9 per
unit.
The essence of this question is recognizing that while idle time is not part of labor content,
we still have to pay workers for it.
For the next two questions, assume that the line is designed so that workers can move
around freely, with no time to go from one step to another, and doing their tasks in the
allotted time without getting in each others way. Assume that ample equipment is available.

13. One of the two workers assigned to Task D is equally competent at Task C, and it is
decided that this worker will work on both Tasks C and D. (i.e., one worker is assigned to C,
one worker is assigned to D, and one worker moves between C and D.) This third worker
moves between C and D so as to maximize the output of the process. What is this lines
maximum output rate, in units per eight-hour day?

8009 Review Questions: PROCESS ANALYSIS 12

 ANSWER

To answer this question, we need to understand how the worker who works on Tasks C and D
operates. His or her mandate, given the phrasing of the question, is to act so as to
maximize output. This implies working so that Tasks C and D together constrain the process
as little as possible. To accomplish that, the cross-trained worker would work on one of the
tasks, say task D, for a while, letting the buffer in front of C fill up, and then (e.g., when the
buffer between C and D is empty), move to C, drawing down the WIP in front of C while the
buffer in front of D fills up.
Tasks C and D together take 27 minutes, and with three workers on those two tasks (one on
C, one on D, and one cross-trained), the best we could expect would be a cycle time for C
and D of nine minutes, taken together. For example, if the cross-trained worker were to
spend one-third of his or her time at C, and two-thirds at D, then Cs cycle time would be
12/1.333 = 9 minutes, and Ds cycle time would be 15/1.667 = 9 minutes also.
Tasks B, C, D, and E have now been balanced, each with cycle time of 9 minutes; they are all
equally bottlenecks. The process cycle time is 9 minutes, and the maximum daily output
rate is thus 480/9 = 53.33 units/day.

14. (This question builds on the assumptions in Question 13.) Management is contemplating
adding a seventh experienced senior worker, as a floater, to this line. This worker is fully
trained to do any of the five tasks, and would move around freely, doing whatever was best
to maximize the output of the process. What would then be the lines maximum output
rate, in units per eight-hour day?
ANSWER

In this question, we again need to consider how the new floater operates to maximize
output. With Tasks B, C, D, and E now running at equal cycle times of 9 minutes, its
reasonable to think of the seventh worker moving among them, allocating his or her time to
each as necessary. (With unconstrained buffers, this presents no problem of blocking or
starving any of the tasks.) With six workers doing 9 + 12 + 15 + 9 = 45 minutes of work,
Tasks B, C, D, and E taken together, can be run with a cycle time of 45/6 = 7.5 minutes .
Since Task A has a six-minute processing time, the process cycle time would then also be 7.5
minutes.
The question that remains is whether the floater should work also on task A. If he or she
does so, then the cycle time on tasks B through E will increase beyond 7.5 minutes, and the
process cycle time will increase, thus cutting the output. Maximum output is thus obtained
if the floater works only on Task B through E. Capacity is then 480/7.5 = 64.
One might think that we could do better than that: Dividing the sum of all five processing
times by 7 gives an apparent cycle time of 7.3 minutes/unit, seemingly faster than the 7.5
derived above. The problem is that this calculation assumes that all the workers are
floaters! In particular, if the worker on A could float, he or she would actually not work on A
all the time. Unfortunately, only the seventh worker has been designated as a fully-cross-
trained floater, so this is not possible.

8009 Review Questions: PROCESS ANALYSIS 13

 Part D
At a local business school, there is a toasted submarine sandwich process that uses a
conveyor-fed oven. Zeynep is the sole operator of the sub making process. In the first step
of the process, she spends 2 minutes putting various ingredients in the sub. Then, she puts
the sub on a conveyor belt and, over a period of 12 minutes, the conveyor moves the sub
from the beginning of the oven to the end of the oven, fully toasting it. After the sub comes
out of the oven, Zeynep spends 1 minute slicing the sandwich and putting it in a box. At
most, 5 subs can fit in the oven at once. The toasting time in the oven does not depend on
the number of subs in the oven.

load slice and

ingredien box
ts 12 min
2 min/sub 1
(oven)
(Zeynep) min/sub
(Zeynep)
15. What is the hourly capacity of this sub making process?
ANSWER

To find the capacity of the process, we must check the capacity of the worker(s) and the
equipment. Zeynep, the cook, completes two tasks per sub: her cycle time = 3 min/sub, so
she has a capacity of 20 subs/hour.
The maximum output of the oven is 5 subs in 12 minutes, or 25 subs/hour. (Alternatively
we could use Littles Law to find: CT of oven = TPT/WIP = 12 min/5 subs = 2.4 min/sub, so
the oven capacity is (60 min/hr)/(2.4 min/sub) = 25 subs/hr.) The process is thus
constrained by Zeynep, so the process capacity = 20 subs/hour.

16. What is the labor utilization?

ANSWER

Zeynep is the bottleneck and thus is always busy, so the labor utilization is 100%.

Suppose another employee is hired to do the slicing and boxing, and Zeynep now only loads the subs
with the right ingredients:

17. What is the hourly capacity of this process with the additional employee?
ANSWER

CT of Zeynep = 2 min/sub; CT of new employee = 1 min/sub

CT of oven = TPT/WIP = 12 min/5 subs = 2.4 min/sub
CT of process is the maximum cycle time of the resources, i.e., 2.4 min/sub. This implies a
capacity of (60 min/hour)/(2.4 min/sub) = 25 subs/hour.

18. What is the labor utilization of the two employees?

ANSWER

8009 Review Questions: PROCESS ANALYSIS 14

 Every 2.4-minute cycle, the operators put toppings on one sub (2 min) and cuts and boxes
another (1 min). Thus, the productive time per unit is 3 minutes, and the time available per
unit is (2 workers)*(2.4 minutes/worker) = 4.8 minutes. Therefore the labor utilization (3
min)/(4.8 min) = 62.5%.

Part E
A factory makes womens blouses in a traditional batch flow process. Making one of
these blouses requires five distinct sewing operations that must be done in sequence. There
are no set ups. The first two of these operations each take two minutes per blouse; the third
and fourth each require one minute per blouse; and the fifth operation requires three
minutes per blouse. Any of these five operations can be done on any sewing machine in the
factory.

19. In the traditional batch flow process, blouses are sewn in batches of 100. A batch moves
to the next operation only when the operator has completed the entire batch. In this batch
flow process, in steady state, what is the minimum throughput time for a batch to complete
all five operations?
ANSWER

The movement of batches through this traditional batch flow or jumbled flow process is
simplified for the calculation of the minimum throughput time as we want to imagine each of
the 5 work stations available immediately on demand. The time it takes to process a batch
of 100 blouses through the steps with no waiting is: 100*2 + 100*2 + 100*1 + 100*1 +
100*3 = 9 min/blouse * 100 blouses = 900 min or 15 hours.

20. In the traditional batch flow process, the factory has 70 workers and has been producing
an average of 37.3 batches per 480-minute shift. On average, each worker has 2 batches at
his/her station (working on one and with one batch waiting). What is the average
throughput time for a batch?
ANSWER

The average production rate is given at 37.3 batches (100 blouses/batch) and we know that
with 70 workers each with 2 batches at her/his station that there are 140 batches in the
factory. The throughput time can be calculated from Little's Law:
TPT = WIP * CT = WIP/Output Rate = 140 batches / 37.3 batches per day/8 hour day = 30
hours.
The output rate is related to the cycle time to produce a blouse: (480 min/day * 70
workers) / 900 minutes/batch = 37.3 batches/day.
Management decided to create a new experimental cell for a certain family of similar
blouses. The new cell was set up with five fully cross-trained workers and five general
purpose sewing machines. A material handler is assigned to bring batches of 100 blouses to
the cell as needed, and take them away when completed. As one batch was being
completed, workers immediately began the next batch. Workers shifted tasks (operations) to
prevent bottlenecks and to avoid idle time. There was sufficient room between operations
for work-in-process inventory.

8009 Review Questions: PROCESS ANALYSIS 15

21. After running this new cell for a while, the company observes that cross-trained workers
need roughly 10% more time to do their tasks than workers in the traditional batch-flow
environment. What is the output rate of this 5-person cell in an 8-hour day?
ANSWER

For this process, with labor content of 9*1.1 = 9.9 minutes per blouse and each of the five
workers able to do all of the five tasks, the average cycle time to complete a blouse would
be 9.9/5 = 1.98 min. To complete 100 blouses would require: 100 * 1.98 = 198 minutes. So,
the average output = 480 minutes/day 198 minutes/batch = 2.4 batches/day

22. For this process, what is the minimum throughput time of a batch?
ANSWER

By steady state, here, we are assuming that the cell doesnt have to fill up at the beginning
of the day, but that the cell already has each worker working on a blouse. As we saw in
question 21, the cycle time for a blouse is 1.98 minutes (lets round to two minutes), so that
the first blouse is finished in two minutes, the second blouse is finished at time four minutes,
the third blouse is finished at time six minutes, etc. So the final blouse in a batch is finished
at time 200 minutes, or just over 3 hours.

Part F
23. In a process with no setups, to calculate the labor cost per unit, you would always
multiply the labor content by the labor wage.
a. True
b. False
ANSWER

Answer = (b)
The cost of labor includes both the cost of time spent actually working on the product
(direct labor content) and what we have to pay workers when theyre idle. If we multiple the
labor content by the labor wage, we will underestimate the actual cost of direct labor -- by
omitting idle time.

24. In a sequential (in-series) process with one bottleneck, which of the following measures
of operating performance is NEVER affected by changing the cycle time of the bottleneck?
a. capacity
b. process cycle time
c. throughput time
d. direct labor content
e. all of the above may be affected
ANSWER

Answer = (e)

8009 Review Questions: PROCESS ANALYSIS 16

 Cycle time and thus capacity are determined by the process time of the bottleneck step.
Cycle time directly affects throughput time. Assuming that there is labor associated with the
bottleneck step, changing the operation time of the bottleneck will change the direct labor
content. Thus (e) is the correct answer. The word NEVER tells us that we cant assume
that the bottleneck involves no labor, invalidating (d) as an answer.

25. For a 4-step in-series process that requires each step to be set up before each batch,
and that maintains strict batch flow discipline (i.e., batches are never split), which of the
following statements is true?
a. The bottleneck will never shift from one operation to another as batch sizes
change.
b. The bottleneck may shift from one operation to another as batch sizes change, but
will always be at one of two operations.
c. The bottleneck may shift from one operation to another as batch sizes change, but
will always be at one of three operations.
d. The bottleneck may shift from one operation to another, and may, for different
batch sizes, be at any of the four operations.
e. None of the above.
ANSWER

Answer = (d)
There is nothing to prevent the bottleneck in a four-step process from being at any of the
steps. Consider the following example:

Set-up Time Run Time

Step 1 80 minutes 16 minutes
Step 2 67 minutes 23 minutes
Step 3 44 minutes 31 minutes
Step 4 30 minutes 32 minutes

Lets consider four different batch sizes: 1 unit, 2 units, 10 units, 20 units. The task times
and the process bottleneck are indicated below:

Batch Size = 1 Batch Size = 2 Batch Size = 10 Batch Size = 20

Task Times Task Times Task Times Task Times
Step 1 96 minutes 112 minutes 240 minutes 400 minutes
Step 2 90 minutes 113 minutes 297 minutes 527 minutes
Step 3 75 minutes 106 minutes 354 minutes 664 minutes
Step 4 62 minutes 94 minutes 350 minutes 670 minutes
Bottlenec Step 1 Step 2 Step 3 Step 4
k

Part H
Below are two charts that depict the buildup of work-in-process inventory in two different
processes.

8009 Review Questions: PROCESS ANALYSIS 17

 A B

WIP (Units) WIP (Units)

0 2 4 6 8 10 0 2 4 6 8 10
Hours Hours

26. What is the output rate for Process A?

ANSWER

This is a process in which the WIP doesnt change over the course of the day. That means
that the output rate must exactly match the input rate. But, thats all we know. Wed need
to know the input rate to be able to say anything about the output rate. Thus, the answer
cannot be determined based on the information available. Yes, this is somewhat of a trick
question.

27. Which process has the greater average WIP?

ANSWER

Process A has WIP inventory at 5 units all day long, so its average WIP is 5 units. For Process
B, for the first half of the day, is WIP inventory goes linearly from 0 to 11 units. The average
inventory for these first five hours is thus (0 + 11)/2 = 5.5 units. The second half of the day
is the mirror image WIP goes from 11 units linearly down to done. So, similarly, the
average inventory in the second half of the day is (11 + 0)/2 = 5.5. So Process Bs average
WIP is 5.5 unit, higher than As.

28. Assume that both processes have the same average output rate during the period
studied. Which one has the longer average throughput time (TPT)?
ANSWER

Littles Law tells us that average TPT = average WIP * average output rate. If A and B have
the same output rate, the process with the higher average WIP will have the higher average
TPT. Thus, the answer is B.

8009 Review Questions: PROCESS ANALYSIS 18

 Part I

Van Overmars Diamond Company, based in Holland, takes large, rough stones and
produces finished diamonds for use in jewelry, using the process shown in the figure above.
Stones are first taken from inventory and inspected. During inspection, 20% of the rough
stones are discovered to be double crystals, from which two diamonds can be produced.
Such stones are cleaved and sawn into two stones. Both of these then pass on to the
rounding step. The remaining 80% of rough stones pass directly from inspection to the
rounding step. Labor times for each step are also shown in the figure above. Assume there
is one person at each process step (six people in total), and that there is room for a small
amount of work-in-progress throughout.

29. What is the cycle time for diamonds coming out of the process?
ANSWER

Even if we threw away all the double diamonds, the first inspection would still have a cycle
time of 30mins/0.8 = 33minutes. Therefore polishing is the bottleneck and the cycle time is
40minutes. By inspection, if we add in the double diamonds, the input cycle time to the
rounding process can only decrease, and polishing will still be the bottleneck.

30. What is the labor content to complete a finished diamond (on average)?
ANSWER

For Single Stones (80%) = 30+20+40+25 = 115min

For Double Stones (20%) = 30/2 + 40/2 + 60/2 +20+40+25= 150min
Weighted Average = 122min

31. Assume that new technology decreases polishing time to 20mins/diamond. How many
diamonds can the line now produce in an 8-hour day?
ANSWER

If polishing now takes 20 minutes, we need to work out what the cycle time is for the
combined single/double diamond process as it feeds into rounding. Convert to output rates
rather than cycle times:
Output rate (single diamonds [80%]) = 0.8 * 2 stones per hour = 1.6 diamonds per hour
Output rate (double diamonds [20%]) = 0.4 stones per hour (limited by inspection) = 0.8
diamonds per hour.

8009 Review Questions: PROCESS ANALYSIS 19

 Combined output rate = 2.4 diamonds per hour
Combined cycle time = 25 minutes
Since inspection also takes 25 minutes/diamond, the process cycle time is 25minutes.
Number per day = 8 * 60 / 25 = 19

32. Assume that polishing is back to its original rate of 40mins/diamond. Assume also that
20% of diamonds fail inspection, and thus need to be re-polished and re-inspected. What is
the new cycle-time of the process?
ANSWER

The bottleneck step will take longer since it has to double process 20% of the diamonds.
The cycle time will now be 40m x 120% = 48 minutes.

8009 Review Questions: PROCESS ANALYSIS 20