Sensing the problem

Phase 1

Introduction of the business:

The business that we have chosen is the Ambala Milk which is located in Faisal
town Lahore. It offers different varieties of milk products throughout a year. It serves
7 days in a week; its opening time is 5am and winds up its business at 2am, which
shows that it works for 21 hours.
The rush hours are from 6am up to 8am and then 8pm up to 12am. The Ambala Milk
always tries to satisfy its customers with quality products, so that to gain maximum
market share as compare to its competitor named ACHA Milk shop.
Key dimension:
The key dimension is the time. The Ambala Milk intends to provide its services more
efficiently to its customers in order to make sure that customers get their desired
products in minimum time.
The key priority of Ambala milk is time management, which can be achieved by
reducing the flow-time, because it has been observed that customers avoid waiting
for long time.
Performance measures:
They include the following:
The time the customers have to wait:
Getting a token from the cash counter and then waiting for their turn at
Ambala Milk takes about 2 minutes.
The processing time:

There is one machine which makes

There are some other products like milk yogurt, flavored milk etc., each
product has its own station, and product named Rabri has its own separate
processing station.
But during the peak hours as mentioned above the rush increases and the
single person makes Rabri.

Key trade off:

Low processing Time = High cost
In order to reduce processing time the Ambala Milk has to bear more cost
What would success look like?
Placing the cash counter for the receipt along with the token.( 1min)
The time for making Rabri (5 min/ glass)
Total time for serving the customer from entry to exit. (11min).

Phase 2
Problem definition:

How might we reduce the time of our customers at the Ambala Milk shop?

Alternative # 1:

How might we reduce the activity time at the cash counter?

Alternative # 2:

How might we cut back the time of the Rabri making process?

Customers perspective:
Time spent by the customers:

Walk to the Ambala Milk shop

Go to the cash counter and Getting the token (2 min)
Walk to the processing counter
Wait for the placed order( Rabri) to be processed (6 min)
Exit from the Ambala Milk Shop (6 min)

Flow time efficiency:

Total value added time/total time a unit is in process
2min+6min+6min/20min=0.7 min = 70%.

Process flow diagram:

Entering the Ambala Milk

Ambala

Rabri processing station

Exit

Cash counter

Bottleneck

KPI Tree:
Unlimited Demand for Rabri
there are 2 employees

Price

Demand
Process takes 14 minutes

Volume

_
Profit

Processing Speed
Idle Time

Capacity

Availability of Milk
& other ingredients

Potential to serve customers

Rent
Electricity Cost

Indirect costs
Cost

Milk &

Direct costs

Phase 3:
We have targeted the milk products specially Rabri servings at the Ambala Milk
shop from 7am to 9am and from 8pm to 10pm on typical Saturday.
Main observations:
The primary reason for the delay in time was the limited number of the
workers.
The bottleneck is the processing station.
These inefficiencies caused the Ambala Milk to lose their customers to their
competitor.
All the data mentioned is based on primary sources.
OEE:
Ambala Milk shop is open 7 days in a week and 21 hours/day
2 hours required to open and close the Ambala Milk shop in that time customers are
not served
Our wastage in a whole day is one glass
Total Available time:
= No. of working days * Working hours per day * Minutes per hour
7*21*60 = 8820 minutes
True value time
= Ambala working days * No. of serving customers per day * Actual Value
time
7*80*11 = 6160
Note:
Serving time per customer= 14
No. of customer per hour= 1/14* 60 = 4.28
No. of customers day served= 4.28 * 19 = 81 customers per day
Wastage of Rabri per day = 1 glass
So

Total No. of customers served per day = 81 1 = 80 customers per day

OEE:
True value time/ Total Available time

Wastage time

Operations extra time

Opening and closing time

OEE = 6160/8820 = 69%

Total available time Time in practice

Performance time

True value
add time

Variability:

Rabri
50%

45%

45%
40%
35%
30%

Rabri

25%

25%
20%

15%

15%

14%

10%
5%

1%

0%
5am-12pm

12pm-4pm

4pm-7pm

7pm-12am

12am-3am

Explanation:
The chart shows variability in the customer demand for the Rabri at
different time intervals. In the first slot from 5am- 12am the demand of the
customers is minimal which show that the demand for Rabri is very low,
whereas demand for Rabri gradually increases with the passage of time. It
has been observed that the demand for Rabri is high during 7pm to 12am,
which shows that the inflow of customers is high at that time, and such hours
are considered to be the peak hours for the sale of Rabri. But later on it

has been also noticed that the demand starts decreasing after 12am which
shows the low rate of inflow of customers.
Inflexibility:
The system of the Ambala Milk is inflexible for the purpose that it has limited
number of staff working at Rabris processing station that is insufficient to
meet the increased demand of the customers in the peak hours.
In order to make the system efficient the Ambala milk needs to be flexible by
increasing the staff members.

Phase 4:
Ideas for improvement:
Increasing the number of the staff from one to 2 members in peak
hours.
The Ambala Milk shop have one extra counter for the ladies which can
be used in peak hours because it has been observed that the inflow of
ladies is low.
By increasing the number of seats at Ambala Milk the number of
queues decreases and also there is self-service over there which
causes increased number of queues, so the increased number of
queues can be decreased by adding 2-3 waiters for serving customers
during peak hours.
Empirical support:
By adding one worker in the processing area causes decrease in the
processing time.
By utilizing ladies counter during peak hours will causes less customers
to wait in the queues.
Ambala should have to increase number of seats because currently
there are only 16 seats available, by doing this Ambala can attract more
customers. Also some of the customers do not prefer self-service, so by
adding 2-3 more waiters will also help in attracting more customers.

Comparison Table

Ease
implementation
Pre-making
Rabri
glass
without
adding ice

of

Likely magnitude of
impact

Easy

High

make to stock each

hour

Efficiency
increase

will

be

Decreasing in Queue

Consolidated
queue

Medium

Low

Designate dedicated
cash
counter,
increase in customer
flow

Marginally
reduce
cash counter waiting
time (which is not
bottleneck)

Production stations

Easy

High

Increasing
No.
of
workers on a single
station

Significantly
reduce
production processing
time
(which
is
bottleneck)

Phase 5:
Experiment:
We did an experiment for reducing processing time at the
Ambala Milk?
We increased the number of employees in peak hours 7pm-12am
according to the customer demand for the Rabri.
Description:
We personally implemented our ideas and observed in variability in
demand 7pm-12am are the peak hours. So according to the invariability
in demand we added one more worker at processing station which
successfully decreases processing time. Due to that our queues also
decreased.
By utilizing ladies counter in peak hours we have observed that our flow
rate has been increased.
By increasing number of seats and adding waiters for serving customers
we have observed that the flow rate has increased up to great extent
and the numbers of customers in queues were decreased.
Improvement resulting from experiment:
Processing time decreased
Number of customers in queues were also decreased
Flow rate increased

 Overall service became better and attracted more customers.

Extra financial value after the experiment:
Number of glasses produced per hour = 60/11 =5.45
Number of glasses produced per day = 5.45*19 = 103.63
I.e. Number of productive hours are 19
Wastage of Rabri per day = 1 glass
So
Number of actual glasses per day= 103 1 = 102
Revenue per day = 102*60= 6120
I.e. price per glass is Rs 60
Revenue generated before implementation of our idea = 80*60 = 4800
Difference per day= 6120 4800 = 1320
So the extra revenue generated per day after our implementation is
1320Rs/day
And the extra revenue generated per month will be = 1320* 30
=39600Rs/month