Process Fundamentals Supply Chain Case Notes

Process Fundamentals Summary

• You need to know where you stand when it comes to quality, price, delivery cycle, and how you differentiate yourself. “Process,” “operation,” and “operating system” are used to refer to any part of an organization that takes inputs and transforms them into outputs of greater value

• A process is a collection of tasks, connected by flows of goods and information that transforms inputs into greater outputs. An operating system can be referred to as a process flow diagram

• An example of a process flow diagram is: Two parallel bakery lines: Raw materials >Mix, proof, bake>Work in progress>pack>finished goods

• You could instead have products flowing from either mixer to either proofer but this will become important when performing a more detailed analysis to determine system capacity

• Inputs to a process can be divided into four categories or more: labour, materials, energy and capital, with capital being most difficult to measure against outputs

• Outputs are either goods or services; sometimes they can be hard to measure so you must consider the cost of providing the output, the quality, and the timeliness, as well as market conditions

• Activities within a process are: tasks, flows and storage.

• A task usually involves adding an input to bring the product or service closer to the end product

• With each process you must consider two types of flows, the flow of goods and the flow of information, ie reports.

• Storage occurs when no tasks are being performed and the goods or service are not in transport

• Process characteristics that are to be considered include: capacity, efficiency, flexibility and quality

• Capacity