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# What's the difference between flow time and cycle time?

Dear OTA,

Please see attached file for full problem description.

Thanks

1. a. What's the difference between flow time and cycle time?
b. What is the relation between flow time and cycle time (in terms of a formula)?
c. Particularly, if flow time of a production process is 3 hours, and if the cycle time of for the same production is 15 min., how many units are being processed in the system simultaneously?

2. IPot is producing imitation mp3 players. The flow of the production is as follows:

where A is a setup process (so its capacity is not divided to 2 for the two paths), D and E refer to the production of the headphones, B and C refer to the production of the player, and F is the final product. But, they also have the option to sell their players without the headphones:

The set with the headphones sell for \$80 and the set without the headphones sell for \$70. The activity completion times and hourly costs of activities are as follows:

Activity Time
(hours) Cost (\$)
A 3 5
B 2 2
C 2 5
D 0.5 1
E 0.5 2
F 1 1

If the process is designed as a job shop (only one item in the process at one time), answer the following:
a. Do you think IPot should produce with or without headphones?
b. Would your answer change if the project completion time for D turns out to be 4 hours in practice in stead of the expected 0.5 hours?
c. Repeat steps a and b if the process is a continuous type of production with multiple items in the process at one time.

#### Solution Preview

1. a. What's the difference between flow time and cycle time?

Flow time is the total time a unit spends inside a system, whereas cycle time is the actual time the unit spends on processing/machine etc... For example, a unit may only take 2 mins in cycle time but it can have hours of flow time if there are multiple units waiting to get processed before it
b. What is the relation between flow time and cycle time (in terms of a formula)?

Flow Time = Inventory * Cycle time
c. Particularly, if flow time of a production process is 3 hours, and if the cycle time of for the same production is 15 min., how many units are being processed in the ...

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