Activity analysis definition
/What is Activity Analysis?
Activity analysis is the examination of the process steps within a selected area of an organization. This analysis determines the following items:
Which process steps are being executed
Which personnel are involved with each step
The amount of time required to complete each step
The amount of resources consumed by each step
Which process steps should be measured and which measurements to use
The value produced by each step
How to Use Activity Analysis
Activity analysis can be used to improve the efficiency and effectiveness of operations. This can be accomplished in many ways, such as with the use of automation, which can eliminate some or all of the labor component of an activity. Another enhancement is to completely replace an existing process, if there is an alternative that can significantly lower costs or increase processing speed. Yet another option is to outsource work to lower-cost regions; this is acceptable when labor costs and/or benefit costs are lower, and as long as there are no offsetting overhead costs associated with the coordination of work with the supplier. It may also be possible to merge processes or break them apart, when doing so reduces costs or increases processing speed.
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Example of Activity Analysis
The owner of a coffee shop wants to conduct an activity analysis. His goal is to identify activities that contribute to customer wait times and operational inefficiencies, ultimately aiming to improve service speed and customer satisfaction. The steps in the activity analysis are as follows:
Define the scope. Focus on the "order-to-delivery" process: the time from when a customer places an order to when they receive their beverage.
Identify key activities. This involves breaking down the process into distinct steps, which are:
Customer places an order.
Order is communicated to the barista.
Barista prepares the beverage.
Beverage is handed to the customer.
Collect data. Observe and measure how much time each activity takes over a sample period. For example:
Order place is one minute.
Communication of the order is 30 seconds.
Beverage preparation is four minutes.
Handoff to customer is 30 seconds.
Analyze the data. Evaluate where delays occur and identify bottlenecks. In this case, beverage preparation takes the longest amount of time, while communication errors between the cashier and barista sometimes cause confusion, leading to rework.
Evaluate resources and costs. Examine the resources used in each activity, such as equipment (espresso machines), staff (number of baristas), and materials (coffee beans, milk, etc.). Determine if resources are being used optimally. For example, are there enough machines or baristas during peak hours? Are there repetitive or redundant steps?
Propose improvements. Based on this analysis, introduce pre-order technology via a mobile app to reduce order placement time. Also implement a digital ticketing system to streamline communication between the cashier and barista. Then cross-train staff to handle both cashiering and beverage preparation during busy hours. Also, consider investing in faster or additional coffee machines for peak times.
Monitor changes. After implementing these changes, track metrics like customer wait time, employee productivity, and overall sales to evaluate the effectiveness of the improvements.
By conducting this activity analysis, the coffee shop owner can eliminate inefficiencies, reduce customer wait times, and enhance overall satisfaction while potentially increasing throughput during peak hours.