Symptoom of Systeem bottleneck, maakt het wat uit?

Let’s start with a definition of the subject bottleneck: “A resource whose capacity is less than the demand placed upon it.” (Apics).

Let me give an example. In an engineer to order (ETO) company the production department has to catch up to deliver on time. Instead of 10 craftsmen they need 16. But they only have 12. According to the definition above, production is a bottleneck. Or sometimes I hear that the project is or has a bottleneck. Quite often companies come into a situation that they need more capacity in production and efficiency drops down. Any recognition?

What is the real problem in this situation? You should be able to find out if production is a symptom or system bottleneck. Production is a bottleneck in the example above. But was there a department that caused the delays because they had insufficient resources. In my 20 year of experience in ETO companies, I noticed that quite often the engineering department is the system bottleneck. But they are not aware of it. Why not? Because the delivery moment is still far away.

What will happen if you improve a symptom bottleneck instead of a system bottleneck? For this I can use examples from our simulator. In the graphs below you will notice that 3 departments (Yellow, Green and Orange) have a demand that is almost or even more then their capacity. (The line above 1 means demand is higher then capacity). What will happen if we extend capacity in just one department.
First we will show the development without any intervention.

figure 1. Development of the load on all departments. No intervention.

We see that Yellow, Green and Orange are becoming bottlenecks. In total 63 projects were delivered. Let’s add more capacity to department Orange on day 110.

figure 2. Development of the load on all departments. On day 110 we doubled the capacity on Orange.

We see that the load on Orange decreased till 50%. But Yellow and Green did not improve and the total amount of projects delivered stayed on 63. Conclusion. Orange is a symptom bottleneck. Let’s do it again but now add more capacity to department Green on day 110.

figure 3. Development of the load on all departments. On day 110 we increased capacity with 50% on Green.

We see that the load on Green decreased till 66%%. But Yellow and Orange did not improve and the total amount of projects delivered stayed on 63. Conclusion. Green also is a symptom bottleneck. Let’s do it again but now add more capacity to department Yellow on day 110.

figure 4. Development of the load on all departments. On day 110 we increased capacity with 50% on Yellow.

Bullseye, we have found the system bottleneck. And because we reduced the load on Yellow to 66% the effect was that the flow of work in department Yellow went up, no more delays and because of that the other departments could start earlier with their work. In the figure below you can find the network structure of the projects we use in our simulator.

figure 5. Network structure projects

It becomes clear that if department Yellow is delaying, Green and Orange can start later.

The effect of increasing the capacity on Yellow the load in Green and Orange will also go down because they can start earlier and not loosing capacity. At the end the company has delivered 66 instead of 63 project.

Symptom or System bottleneck, Yes is does matter a lot.

With our concept FLOW MPM you can check your organization on the development of a System bottleneck now and in the future. Bare in mind that a System bottleneck is not always stable. You have to scan the situation constantly. FLOW MPM is delivering you all the needed information. Just connect our FLOW MPM tool to your ERP, Project Management or Workflow System. We know that the needed data is already in your system available.

Jan Willem Tromp