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ISE 542Production Planning & Control

Class Notes-Chapter 3A

Dr. Grsel A. Ser

IMSE Dept

Ohio University

Winter 2003


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PPC Class Notes-Chapter 3A

World Class Manufacturing

Definition Meeting the challenges of worldwide competition

in manufacturing requires operating policies,practices, and systems that eliminate waste andcreate value for the customer

Customers demand high-quality products atsubstantially lower prices

Competitiveness and profitability can only bemaintained if manufacturers cut costs bybecoming better at what they do and how they doit


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Definition Becoming world class is not simply the

responsibility of the manufacturing function, butrequires the involvement and commitment ofsales, marketing, engineering, customer service,accounting, finance, and all other functionalgroups

Being world class manufacturer means that thecompany can compete successfully and make a

profit in an environment of internationalcompetition, not only now, but also in the future


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Definition To make a profit, a company must sell its products at a

price above its costs and still provide a product to themarketplace that offers better value than the

competitions product This value is typically perceived by customers as a

combination of price, quality, availability of theproduct and service, and the products performance and

capability In essence, being world class means being capable of

bringing products to the marketplace that offer bettervalue than the competition without going broke


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Characteristics Grouped inI. Management/Employee Involvement

II. Quality

III. Production Operations


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I. Characteristics of Man/Emp Inv.1. Leadership (dedicated to CI, motivate people)

2. World Class Goals (use benchmarking and determinecurrent standards of excellence)

3. Long-Term Strategic Plan and Direction (a 3-5 yearsrolling plan with skills, tools, knowledge required toimplement the plan)

4. Employee Involvement (get employees involved in all

levels of organization, training)5. Integrate Objectives (dissolve boundries between

different areas and divisions and integrate theobjectives and activities)


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I. Characteristics of Man/Emp Inv.6. Goal-Consistent Measurement/Reward System

(what gets measured and rewarded gets done)

7. Product or Customer Focused Organization(a general manager is responsible for all tasks for a

given product or customer line)

8. Good Communication Systems (timely, accurate)

9. Promotion/Support of Research and Education

(improve relations with universities)


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II. Characteristics of Quality10. Customer-Driven Product Development

(the voice of the customer is heard, communicatedthroughout the organization, and acted on in a timely

and responsive manner)11. Cross-Functional Teams

(CF teams for responding to and communicating theneeds of customer; coupling decisions in product design,

materials, and manufacturing)12. Individual Responsibility

(quality is everyones responsibility)


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II. Characteristics of Quality13. Statistical Process Control (SPC)

14. Emphasis on Innovation and

Experimentation

(improve products and processes)

15. Quality-Certified Vendors

(one or a very few supplier)


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III. Characteristics of Production Operations

16. Continuous Flow Process/Cellular Manufacturing

(standardizing, simplifying, focusing, reduction in

leadtimes, work-in-process inventories, and material

handling)

17. Demand-Based, not Capacity-Based, Processing

(dont produce if not needed)

18. Quick Changeover Procedures/Small Lot Sizes

(reduce equipment downtime and allow small lot sizes)


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III. Characteristics of Production Operations

19. Emphasis on Simplification Before Automation

(WCM tend to view high technology and

automation more as complementary tools than as amanufacturing strategy. Automation before

simplification adds more complexity)

20. Preventive/Predictive Maintenance Programs

(based on worker involvement efforts)


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Benchmarks of World Class

Manufacturing Performance

Manufacturing Leadtimes: days not weeks

Work-in-Process Inventory: hours or days not

weeks

Inventory Turns: 15-20 times per year

External Customer Rejects: 50 parts per million

Internal Customer Rejects: 200-250 parts permillion


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Benchmarks of World Class

Manufacturing Performance

On Time Deliveries: 95%-98%

Cost of Quality: Less than 5% of Sales

Setup Times: Minutes not Hours


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Traditional (Functional) Layout

Similar machines are grouped into department

Milling Machines Drilling Machines

M M

M M

D D D

D D D

G G

G G

Grinding Machines

A A A

A A A

Assembly


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Cellular Layout

Similar parts are grouped into families and they

are processed in cells dedicated to families

M G

D A

M D A

M D A

G A

G D

D M A

D G A

CELL 1- FAMILY 1 CELL 2- FAMILY 2

CELL 3 FAMILY 3 CELL 4 FAMILY 4


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Clustering Algorithm

Kings Rank Order Clustering Algorithm

Step 1. Calculate total weight for column jWj = 2

i Mij i

Step 2. If Wj is in increasing order, goto step 3. Otherwise,

rearrange the columns in increasing order

Step 3. Calculate total weight for column jWi = 2

j Mij

j

Step 4. If Wi is in increasing order, stop. Otherwise, rearrange the

rows in increasing order and goto step 1.


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i row

j column

Wi weight for row i

Wj weight for column j

Mij element for row i and column j (0,1)


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An ExampleIteration 1 :

W /C P1 P2 P3 P4 P5 P6 P7 P8 Factor

100 1 1 1 1

200 1 1 1300 1 1

400 1 1

500 1 1 1 1 1

600 1 1 1

700 1 1Weight

Rank


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An ExampleI t e r a t i o n 2 :

W /C W e i g h tR A N K

F a c t o r


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An Example

Iteration 3:

W /C Facto r

W e i gh t

R a nk


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An Example

Iteration 4 :

W /C W eight R A N K

Factor


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An ExampleIteration 5 :

W /C P8 P4 P1 P3 P7 P5 P2 P6 Fac tor

W e i g h t

R a n k


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JIT Framework

Production

Planning

Master Production

Scheduling

Detailed Material

Planning

Material and

Capacity Plans

Purchasing

Demand

Management

Resources

Planning

Rough -cutCapacity

Planning

DetailedCapacity

Plannin

Shop Floor

Systems


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JIT Framework

SHADED AREA SHOWS THE IMPACT OF JIT ON

PRODUCTION PLANNING AND CONTROL

ACTIVITIES

JIT AFFECTS LOWER LEVEL ACTIVITIES MORE

THAN HIGHER LEVEL ACTIVITIES


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JIT Core Components

1. Focused Factories

2. Group Technology

3. Design for Automation

4. Setup Reduction

5. Uniform Scheduling6. Pull System


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Major Benefits of JIT

Improved: Reduced:

Quality Inventory

Productivity Lot Sizes

Service Leadtimes

Capacity Unit Costs

Standardization Design TimeTransport Systems Space

Flexibility Energy


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Planning Checklist

MRP JIT

Production Plan X X

Master Schedule X U/S

Bills of Material X X

On Hand X N.A.

On Order X N.A.Order Quantities X 1

Leadtimes X 0


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TRADITIONAL MRP SYSTEM

WAREHOUSE

TALL BILL OF MATERIAL

A

B C

E

F

D

D C A

F D D,E C B,C A


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A TYPICAL JIT SYSTEM

E BFLAT BILL OF MATERIAL

F EB

A D CF A


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ACCEPTABLE LAYOUT

TYPES

U, C, S SHAPES


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LAYOUTS TO AVOIDTRIANGULAR ISLANDS RECTANGULAR ISLANDS

M/C M/C

M/C

OPERATOR

M/C M/C

M/C M/C

OPERATOR

LINEAR LAYOUT

OPERATOR

M/C M/C M/C M/C M/C


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FOCUSED FACTORIESRAW MATERIALS FINISHED PRODUCTSFOCUSED FACTORY 1

FOCUSED FACTORY2

FOCUSED FACTORY 3

FAMILY 1

FAMILY 2

FAMILY 3

CELLS ASSEMBLY LINE

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