Little's Law Flashcards
Bottleneck
The factor that limits production, usually the slowest operation.
Capacity
A measure of output per unit time when fully busy.
Capacity Utilisiation
A measure of how much output is actually achieved.
Cycle Time
The average time between units of output emerging from a process (also called Flow Rate) (also used interchangeably with Lead Time!)
Lead Time
The time between placement of an order and its receipt.
Line Balancing
Tries to equalise the amount of work at each workstation.
Precedence Requirements
The physical restrictions on the order in which operations are performed.
Takt Time
Aims to match the pace of production with customer demand.
Throughput Time
The time for a unit to move through a process (also called Flow Time).
Work in Progress (WIP)
The number of units within a process waiting to be processed further (also called ‘work-in-process’) (i.e., inventory).
Lead Time Measurement
Lead Time is measured by elapsed time (minutes, hours, etc.)
Cycle Time Measurement
Cycle Time is measured by the amount of time per unit (minutes/customer, hours/part, etc.)
Little’s Law
Little’s Law says that the average number of items in a queuing system, denoted L, equals the average arrival rate of items to the system, λ, multiplied by the average waiting time of an item in the system, W”.
L = λW
How to reduce Cycle Time
Increase Throughput:
This can be done through process improvement. That is, identify waste in a system –especially waste that is present in the system constraint –then systematically eliminate it. Commit significant investment to increase the scale of the system to better handle the increase of WIP. This is fine when considering longer-term system capacity. It is impractical, however, when addressing relatively short-term variations in demand.
Reduce WIP:
Only this option can be used to effectively address these short-term demand variations. Reducing WIP may require some counterintuitive actions, such as temporarily pulling projects or orders out of the workflow and setting them aside. With the resulting decline in WIP, cycle time drops and the remaining projects get done better and faster, so much so that projects originally pulled out of the workflow can then be reinserted and completed on or before the original target date. In other words, by stopping work on a project, it gets done faster.
Calculate WIP
Throughput x Cycle Time
L = λW
