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.