Chapter 2 - Operations management (McGraw-Hill Cachon & Terwiesch)

Process

A set of activities that make a collection of inputs, perform some work for activities with those inputs, and then yield a set of outputs

Process flow diagram

A graphical way to describe the process. It uses boxes to depict resources, arrows to depict flow, and triangles to depict inventory locations.

Resource

A group of people and/or equipment that transforms inputs into outputs

Process scope

The set of activities and processes included in the process

Flow unit

The unit of analysis that we consider in a process analysis; for example, patients in a hospital, scooters in a kick scooter plant, and calls in a call center

Process metric

Scale or measurement of process performance and capability

Inventory = I

The number of flow units within the process

Flow rate = R

The rate at which flow units travel through a process

Flow time = T

The time of flow unit spends in a process, from start to finish

Little's law

The law that describes the relationship between three key process metrics: inventory, flow rate, and flow time.

Little's law equation

Inventory equals flow rate multiplied by flow time. I = RxT

Flow rate equation

Flow rate equals inventory divided by flow time. R = I/T

Flow time equation

Flow time equals inventory divided by flow rate. T = I/R