A note on process analysis
• A process is essentially any procedure that converts inputs into outputs
• Organizations create value by providing either manufactured products or services. These, in turn, are the output
of processes.
Order-winning criteria and capabilities
• The customers care about the following (these are called order-winning criteria, PQVDI):
o Price
o Quality
o Variety
o Delivery
o Innovation
• Process analysis is the understanding of what the process is currently capable of doing. There are 3 important
aspects of capability (also called basic metrics used to analyze any process):
o Capacity
o Capacity utilization
o Throughput
• Process terminologies:
Term
Description
Term
Description
Batch
A batch is a group of items or orders
that is processed at one time.
Batching provides a way to spread the
effort involved in completing a task
over multiple items. In some
situations, batching may make the
Batch size
The batch size at a process stage is
the number of items or orders
processed as a batch. Sometimes,
the production batch size at a
process stage can differ from the
transfer batch size.
easier due to repetition.
of product or service to another, it is
Mostly independent of batch size
period, it is important to remember
that what we are really calculating is
the average capacity in that time
the amount of revenue that the
