Simulation

Simulation is related to, but should not be confused with, Prototyping; it differs in that simulation is used to model a complete value stream while prototyping is used, in a laboratory environment or with a control group, to test smaller components of a process. Prototyping often follows simulation to further validate the value of process changes.

Simulation can be performed manually, but it is an exceedingly complex, labor intensive, and time consuming technique. It is most effectively accomplished using an advanced automated tool, one which has been specifically designed to support the analysis and optimization of business processes. These tools perform complex simulation of variables and provide rapid analysis of results in tabular, graphical and/or chart format.

Applications

• To reduce risk by modeling a reengineered value stream prior to implementing the value stream in the enterprise.
• To validate assumptions concerning throughput, volumes, costs, time, human and physical resources, and facility capacity.
• To validate improvements or to identify at what point processes break down.

1. Define the processes and tasks that make up the value stream, their sequence and priority.
2. Define information or resource requirements (i.e., source, transportation time) for each task.
3. Define task execution parameters, including starting time, waiting time and interruptions.
4. Define flows between tasks, including starting time and duration.
5. Define the physical resource data including who, what, and how.
6. Define simulation scenarios, including constants and variables in the components of the process.
7. Execute simulation scenarios.
8. Analyze and confirm results. As necessary, revise the value stream and/or simulation scenarios and conduct simulation again.

Using simulation, a reengineered value stream can be modeled, varying steps and parameters, to determine the effects of change variations on the process and to identify areas of weakness. It is an effective way to test the effects of "what if" scenarios on complex business processes (e.g., "What happens if task number 3 is eliminated?" or "What happens if volume increases by 10%? or "What happens if the time required to complete task number 1 is decreased by 12 minutes or 5 days?"). This allows the changed value stream to be modeled and studied to validate improvements or to identify at what point the process breaks down. Simulation provides the results of change without having to physically implement the change.

Manual simulation of a complete value stream process can be exceedingly complex, labor intensive, and time consuming. In today's environment, simulation is most efficiently and effectively performed, using an automated tool that has been specifically designed to support business reengineering through the analysis and optimization of business processes. In today's marketplace, there are a number of tools that perform complex simulation and provide rapid analysis of results in tabular, graphical and/or chart format. These automated tools vary in their degree of sophistication, functionality, and cost. A tool that incorporates object-oriented concepts and reusable components is highly recommended.

Use simulation to test a reengineered value stream. Begin by creating a model of the value stream, defining all processes and tasks that make up the value stream in sequence and priority so that the flows between tasks are represented. Add to the model the information or resource requirements to complete each task, including source and transportation time. Factor in task execution parameters, including starting time, waiting time and interruptions that occur in normal task execution. Define the physical resource data associated with each task (e.g., who performs it, what is done, and by what method).

Define the simulation scenarios that will be executed. This is accomplished by varying tasks or the parameters associated with them, including input, times, volumes, etc., to reflect the situations that should be tested. Execute simulation based upon the simulation scenarios by varying the parameters or tasks included in the simulation model.

Analyze the results of the simulation to determine the effect the change has had upon the value stream. Identify strengths to determine where the change to the process has added value by improving the duration (i.e., time to complete), throughput, efficiency, etc. Identify weaknesses and any point at which the process has broken down or become inefficient. In the event that weakness is evidenced, adjust the model and conduct additional simulation.

References

1. Walter J. Utz. Software Technology Transitions. Prentice-Hall, Inc. 1992.
2. William E. Perry. Quality Assurance For Information Systems. QED Technical Publishing Group, 1991.