Operations Management Reading: Process Analysis

Organizations without the means to improve rarely can keep up with competition. Improvement requires a deep understanding of underlying operating processes and an ability to assess their performance. The essence of process analysis is the ability to answer the questions, "How is this process doing?" and "How can it do better?" In this Reading, readers observe an operating process and consider the data that needs to be collected so that they are able to answer these key questions. How can a process be described as "doing" well? The answer depends on what the customer promise is and how the firm seeks to create and capture value for its stakeholders. Is the company focus on speed, quality of service, and customer satisfaction? Its measures of success would be very different from another business running a high-volume, capital-intensive factory with a customer promise of low cost, focusing on capital utilization, high volumes, and specific measures of efficiency and productivity. The Reading begins with an overview of the steps in analyzing a process, beginning with process flow diagrams, represent the sequence of tasks and flow of product and information. Concepts introduced in the reading include batch processes, bottleneck analysis and cycle times, and calculating capacity and labor utilization. A variety of numerical analyses are introduced to measure process performance with a focus on 3 critical dimensions: capacity, efficiency, and effectiveness.

• Customer experience
• Decision making and problem solving
• Process improvement
• Operations and supply chain management
• Business analysis