PRDH12-2 - Session 13

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Dipankar Bose - XLRI

Product A

Profit = Rs. 80/unit

Demand = 100/week

Production = 0.4 hours/unit

Product B

Profit = Rs. 50/unit

Demand = 200/week Production = 0.2 hours/unit

Total available time = 60 hours/week

What will be maximum profit?

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Throughput The rate at which products are sold

Limited by internal constraints (plant capacity)

Limited by external constraints (market demand)

Constraint Anything that limits a systems performancerelative to its goal Bottleneck

Inventory All the money used to purchase things the

system intends to sell

Paid but not sold Operating expense The money a system spends to turn

inventory into throughput

Throughput accounting An accounting system used to

measure TOC operations

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Process batch Quantity of product processed at a work

center before the work center is reset to produce another

product

Should be variable Transfer batch Quantity of product that move from one

work center to next

Should be small in size

Two critical assumptions The goal of product or customer mix and volume

should be to maximize throughput

Once a certain capacity exists, operating expenses are

fixed

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Balance flow, not capacity

An hour lost at a bottleneck is an hour lost forever

An hour saved at a non-bottleneck has no value

Bottlenecks govern both throughput and inventory in thesystem

Schedules should be established by looking at all

constraints simultaneously

The level of utilization of a non-bottleneck is determinednot by its own potential

But by some other constraint in the system

Utilization and activation of a resource are not

synonymous

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the systems constraints

Decide how to the constraints

everything else to the exploitation of

constraints the systems constraint

If any of the constraints are violated, repeat the process

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Constraint management

Synchronous/synchronized manufacturing (General

Motors)

Optimized Production Technology (OPT) software Drum-Buffer-Rope system

Throughput technology

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The drum is the physical constraint of the plant

The work center or machine or operation that limits the

ability of the entire system to produce more

The rest of the plant follows the beat of the drum They make sure that the drum has work and anything the

drum has processed does not get wasted

The buffer protects the drum

The buffer always has work flowing to it Buffers in DBR have time as their unit of measure, rather

than quantity of material

This makes the priority system operate strictly based on

the time an order is expected to be at the drum

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Traditional DBR usually calls for buffers for protection

against several points in the system

For the Drum Constraint Buffer

For assembly of constraint & non-constraintAssembly Buffer

For Due date Shipping Buffer

The rope is the work release mechanism for the plant

Only a "buffer time" before an order is due It gets released into the plant

Pulling work into the system earlier than a buffer time

Guarantees high work-in-process

Slows down the entire system

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Exploit the drums

Work drums continuously

Reduce set-ups

Off-load work to non-drum work centers Subordinate everything to drum

Staffing

Maintenance

Engineering Support Run non-constraints using FIFO

Buffer coordinator expedites at non-constraints to meet

drum schedules

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Elevate DrumIncrease Capacity

Add Capacity

Process Improvements

Offload Start OverIdentify new constraint

Change Company Culture

Educate Personnel in DBR/TOC

Eliminate Cost Accounting Based PerformanceMeasures (Productivity, Efficiency, Product Cost, etc.)

Its O.K. for non-drums to be idle

Change culture company-wide, not just manufacturing

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A project will accumulate delays, it will not accumulate

gains

Individuals always desire a safety buffer

No early finishes Parkinsons Law

Student Syndrome

Multi-tasking

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Halve original time estimates and apply CPM to prepare

late start (LS) schedule

If there is resource contention in the schedule obtained in

Step 1, resolve it going backward in time and reschedulethe activities ensuring the minimum increase in the project

duration. Avoid multi-tasking in the process

Identify the critical chain. If there are more than one,

choose any one of them Add a Project Buffer (PB) at the end of the project. It is

equal to half of the total time stripped off the critical chain

activities. The method is called the 50% cut-and-paste

method of buffer sizing.

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Add Feeding Buffers (FB) at the places where non-critical

chain activities merge into the critical chain, to protect the

critical chain from any variations in the non-critical chain

activities. The size of FB is again equal to the half of thetotal time stripped off the longest chain of non-critical

activities

Consider the Resource Buffer (RB) as a virtual task inserted

prior to critical chain tasks that require critical resources Buffer management Green-Yellow-Red Rule

Drum Buffer/Capacity Buffer Resources shared among

multiple projects

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Identify CCRs

Paretos Rule may help

CCR has limited activities in any one project

Identify CCR as the Drum Make the most of this resource

Holdup of CCR is a delay in the project

Protect from statistical fluctuations with time buffers

(Buffer) Monitor Buffer Buffer Management (BM)

Monitor CCRs to ensure the timely release of materials

upstream (Rope)

Subordinate other resources to CCR

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A (30) B (15)

C (20) D (20)

X

X

Y

Z

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A (15) B (8)

C (10) D (10)

X

X

Y

Z

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ES advantages

Slack is available

We can get payment if payment is based on % of job

finished Takes care of uncertainties

LS advantage

Reduces WIP inventory Capital output is delayed

Allows to incorporate last minute changes

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PRDH12-2 - Session 13

Documents

Transcript of PRDH12-2 - Session 13