Throughput (production)

Throughput is a measurement relating to the efficiency of production or other processes. Although forms of throughput appear in many industries, it is most common in manufacturing. Some measures of manufacturing throughput focus on the amount of time required to convert raw materials into a finished product. This measurement includes the actual construction time as well as the time needed to inspect and transfer materials and to wait out delays. Other forms of manufacturing throughput focus on products instead of time. They measure the number of products made in a given period, the time required to maintain or increase the value of the products, and the percentage of products that are suitably high-quality and saleable.

Background

Before the Industrial Revolution, most items were individually handcrafted by artisans or homemade by the people who would use them. The idea of mass-producing consumer items did not become a widespread reality until the 1800s, at which time great innovations in technology and manufacturing processes allowed companies to create hundreds or even thousands of goods per day. Once that became the production standard and the expectation of the consumer, businesses had to focus on maintaining and continually increasing their levels of productivity.

Throughout the twentieth and into the twenty-first centuries, the pace of business continued to increase, and many marketplaces expanded around the globe. Competition skyrocketed, and corporate growth and profit became dependent on outdoing others and stabilizing a place in the market. Manufacturers made many innovations relating to creating better products more quickly and inexpensively. Some of the most important innovations relate to the concept of throughput, the total time required to manufacture a product for sale. By focusing on such measurements as throughput, business experts sought to make companies as efficient as possible to secure market dominance.

Overview

The concept of throughput appears in many industries. Overall, throughput relates to productivity and efficiency, although the exact meanings and measurements may vary somewhat according to the context. Most users calculate throughput in terms such as number of items shipped or sold, or production output per hour or day. In the twenty-first century, throughput sometimes appears in computer and Internet technology contexts. Here, the term relates to factors such as the capacity of a computer system to transfer information, the number of data requests efficiently handled by a web server, or the rate at which data can be conveyed across a network.

In production-based companies, throughput time is commonly defined as the total amount of time required to complete a manufacturing process. In other words, it means how much time it will take to change raw materials into a completed product ready for shipment to sellers or consumers. Within this context, throughput consists of four main factors: the amounts of time required for processing, inspection, movement, and waiting (or queuing). Each must be calculated and added for a complete view of the product throughput.

Processing time encompasses the time during which raw materials are converted into the finished product. This might involve cutting timber into boards for sale; assembling the parts of a computer hard drive; or mixing, baking, and boxing ingredients into ready-to-sell cakes. Inspection time relates to the total amount of time spent examining the product or its manufacturing process, from the raw material to the finished product stages. Many companies perform inspections throughout production to assure safe materials and error-free products.

The other aspects of production throughput are often overlooked but still substantial. Movement time involves all the time spent moving resources, parts, or products, whether to the assembly area, between assembly stations, or out of the assembly area to locations for shipment or sale. In large facilities, or in products with many steps of manufacture, items may require many moves during which any distance or delays will add to throughput. Even more damaging to throughput, waiting time involves all delays experienced during the process. If communication is slow, parts are shipped to the wrong department, workers are late or unprepared, or other such delays occur, waiting time may greatly reduce efficiency.

Analysts study the manufacturing process and measure the average time in each category. Then, the analysts add the categories to determine the overall throughput time of the product. Once that is established, managers can work to maximize time usage and trim wasted time. Often, the actual processing during which the product is assembled is one of the least time-consuming elements, with the greatest consumption of time happening during inspections, waiting periods, or transfer activities. In many cases, throughput analysis can uncover major inefficiencies in production projects and help managers streamline their operations significantly.

Many companies and business experts use slightly different approaches to defining throughput, and use measurements of throughput for different purposes. Some uses of throughput focus on the number of units completed during a certain period, rather than the amount of time required per completed unit. Some versions of throughput even factor in sales records or only measure units sold, rather than units produced. This technique is based on the underlying concept that the overall goal of a business is to create and sell products, and a company is not truly successful until its products sell. For example, a factory may make ten thousand smartphones per month, but if only two thousand sell, the throughput is judged by the latter number.

Throughput based on products rather than time generally requires three criteria of measurement. The first is productive capacity, the number of items that can be completely produced during a certain period. The second is productive processing, which encompasses all activities that are meant to increase the ultimate value of an item, such as advertising and market research. The third is process yield, which refers to the number of items that are made correctly and up to consumer standards. In this case, determining the throughput involves multiplying the three factors. Managers and analysts can then study the results and search for ways to increase the total units and total quality products and/or to decrease the time requirements.

Bibliography

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