Production Activity Control

1. Production Activity Control Chapter Six

2. Strategic Business Plan Master Plan Production Plan Planning Master Production Schedule Material Requirements Plan Implementation Production Activity Control & Purchasing Grand Scheme of Things

3. Priority Planning and Production Activity Control Production Plan Master Production Schedule Planning Material Requirements Plan Input/Output Control Implement and Control Production Activity Control Purchasing Operation Sequencing Grand Scheme of Things

4. Production Activity Control • PAC is authorized via the MRP to: • release work orders to the shop • control work orders to completion (timely) • be responsible for immediate planning of the work order flow from release to completion • manage day-to-day activity, while providing necessary support

5. Production Activity Control Activities • Planning • Flow of work planned by: • Ensuring materials, tooling, personnel, and information are available when needed • Scheduling start & completion dates for each shop order at each work center

6. Production Activity Control Activities • Implementation • PAC must put plans into action by advising the shop floor as to what must be done including: • Gathering information needed by the shop to make the product • Releasing (dispatching) orders to the shop floor as authorized by the MR Plan

7. Production Activity Control Activities • Control • Monitoring activities include: • Rank the shop orders in desired sequence by work center • Track actual performance of work centers and compare it to planned schedules • Monitor and control work-in-process, lead-times, and work center queues • Report work center efficiency, operation times, order quantities, and scrap

8. Manufacturing Systems • Flow Manufacturing • Production of high volume standard products • Repetitive manufacturing: discrete products • Continuous manufacturing: continuous flow • Major characteristics: • Routings are fixed & work centers arranged according to routings • Dedicated work centers produce limited range of products • Material flows via some form of mechanization • Capacity is fixed by the line • Simple implementation and control

9. Manufacturing Systems • Intermittent Manufacturing • Characterized by many variations in product design, process requirements, and order quantities • Major characteristics: • Flow of work is varied and depends on designs • Machinery and workers must be flexible • Throughput times are generally long • WIP is usually large • Required capacity is difficult to predict • PAC activities are complex

10. Manufacturing Systems • Project Manufacturing • Involves the creation of one or a small number of units • Design may be carried out or changed as the project develops • Requires close coordination between manufacturing, marketing, purchasing, and engineering

11. Planning Files • Planning Files Required • Item Master file • Product Structure file • Bill of material file • Routing file • Work center master file

12. Part number Part description Manufacturing lead time Quantity on hand Quantity available Allocated quantity (allocated but not drawn from inventory) On-order quantities (balance due on outstanding orders) Lot-size quantity (# ordered at one time) Planning Files • Item Master File • One record for each part number • Contains all the pertinent data for the part

13. Planning Files • Product Structure File (Bill of Materials) • Contains a list of all components & quantities needed to assemble a parent (top assembly) • Forms basis of a “pick list” • To be used by the storeroom to collect parts required to make the assembly

14. Bill of Material Example .

15. Planning Files • Routing File • List operations and sequence required • Brief description of each operation • Equipment, tools, and accessories needed for each operation • Setup times (in standard time) • Run times (in standard time) • Process time for one unit • Lead time for each operation

16. Route Sheet • Lists all operations

17. Planning Files • Work Center Master File • Collects all the relevant data on a work center • Work center number • Capacity • Number of shifts per week • Number of machine hours per shift • Number of labor hours per shift • Efficiency • Utilization • Queue time • Alternate work centers

18. Control Files • Shop Order Master File • Shop order number • Order quantity • Quantity completed • Quantity scrapped • Quantity of material issued to the order • Due date • Priority • Balance due • Cost information

19. Control Files • Shop Order Detail File • Operation number • Setup hours, planned and actual • Run hours, planned and actual • Quantity reported complete at that operation • Quantity reported scrapped at that operation • Due date or lead time remaining

20. Scheduling • The Goals of Scheduling • Minimize completion time • Minimize WIP inventory (keep inventory levels low) • Minimize customer wait time • Maximize utilization (make effective use of personnel and equipment)

21. Scheduling • By scheduling effectively, companies use assets more effectively, creating greater capacity per $ invested (lowering cost) • This added capacity & related flexibility provides faster delivery & better customer service • Good scheduling is a competitive advantage through dependable delivery

22. Scheduling • Objectives • Meet customer due dates • Minimize job lateness • Minimize response time • Minimize completion time • Minimize time in the system • Minimize overtime • Minimize work-in-process inventory • Maximize machine or labor utilization

23. Scheduling • Manufacturing Lead Time • Queue Time (largest of the five) • Time job spends waiting to be started at next machine center • Setup time • Time required to prepare the work center for operation • Run time • Timed needed to run the order through the operation • Wait Time • Time job spends waiting to be picked up for movement out of department • Move Time • Time job spends actually in transit

24. ORDER RELEASE MOVE MOVE QUEUE SETUP RUN WAIT QUEUE SETUP RUN WAIT MOVE MOVE QUEUE SETUP RUN WAIT QUEUE SETUP RUN WAIT Manufacturing Lead Time

25. Manufacturing Lead Time • Walk Through Manufacturing Lead Time Example on page 152

26. Scheduling Techniques • Forward Scheduling • Assumes that material procurement & operation scheduling starts when order is received • Operations are scheduled forward from that date • A likely result is completion before due date • Inventory buildup • May be used to determine the earliest delivery date for a product

27. Scheduling Techniques • Backward scheduling (common in industry) • The last operation on the routing is scheduled first at the completion due date • Previous operations are then scheduled back from the last operation • WIP is reduced • Minimized slack time may result in decreased customer service

28. Back Scheduling (pg. 154) X Part Operation Time (days) A 10 5 20 3 B 10 10 Assembly X 5 A B Part A OP 10 OP 20 Assembly X Part B OP 10 85 90 95 100 Working Days Scheduling Techniques

29. Hours of capacity Normal capacity 1 2 3 4 5 6 Time (weeks) Scheduling Techniques • Infinite Loading • Assumes that workstations on which operations are to be performed have unlimited capacity • Assumes infinite capacity

30. Hours of capacity Normal capacity 1 2 3 4 5 6 Time (weeks) Scheduling Techniques • Finite Loading • Assumes a defined limit to available capacity • If capacity is not available the order must be scheduled in a different time period

31. Operation A Set Up Lot 1 Lot 2 Move Time M M Set Up Lot 1 Lot 2 Operation B Scheduling Techniques • Operation Overlapping • Operation B is allowed to begin before entire lot is completed in Operation A • Costs involved: • Move costs  • May  lead time for other orders • May actually  capacity if Operation B is idle waiting for parts from Operation A

32. Scheduling Techniques • Walk Through Operation Overlapping Example on page 156

33. Machine A Set Up RUN This VS Machine A Set Up RUN Reduced Lead Time This Machine B Set Up RUN Scheduling Techniques • Operation Splitting • Lot split in half & two machines are utilized simultaneously • Effective when: • Setup time is low compared to run time • A suitable work center (machine) is idle • One operator can run multiple machines

34. Scheduling Techniques • Walk Through Operation Splitting Example on page 157

35. Capacity Overload C F Station A Capacity B A E D Station Capacity Underload Scheduling Bottlenecks • Bottlenecks are those stations where the required capacity is  available capacity (Capacity Overload)

36. Scheduling Bottlenecks • Throughput • The total volume of production passing through a workcenter • Bottlenecks control throughput

37. Wheel Assy Handle Assy Final Assy Scheduling Bottlenecks • Walk Through Bottleneck Example on page 158 Inputs Demand (500) 1200 550 450

38. Managing Bottlenecks • Establish a time buffer before each bottleneck • Time buffer = inventory • Ensures bottleneck operation is always working, not shutdown due to lack work • Control the rate of material feeding the bottleneck • At a rate equal to its capacity + buffer • Provided the needed bottleneck capacity • Better utilization, fewer setups, reduce runtimes • Adjust loads • Change the schedule

39. Theory of Constraints • Focuses on an organizations constraints • Seeks to improve these constraints • Types of constraints • Physical • machine capacity, raw materials, etc. • Non-physical • morale, training, culture

40. Theory of Constraints • Chain analogy • Activities going in one link are dependent on previous link • Find constraint (weakest link)

41. Theory of Constraints • Five Step Process TO Manage Constraint • Identify the constraint(s) • Exploit the constraint(s) • Focus on how to get more production within existing capacity limitations • Subordinate all else to constraint(s) • Focus resources on accomplishing the previous step • Elevate effort • Reduce effects of constraints by off-loading work or by expanding capability • Go back to Step 1 • Return to the first step and identify new constraints

42. Scheduling with the TOC • Drum • “drumbeat” or pace of production • Also known as “takt time” • The pace of the throughput as defined by the constraint • Buffer • “time” buffer used to ensure the constraint is always working, never starved • Rope • Rope “pulls” production to the constraint • Kanban-type system

43. Shop order Engineering drawings BOM Route sheets Material issue tickets Tool requisitions Job tickets Move tickets Order Packet • Implementation is arrived at by issuing a shop packet to manufacturing authorizing them to proceed with manufacturing the item • A shop packet is compiled and issued:

44. Control • Objectives • Meet delivery dates • Maximize company resources • PAC must • Control input • Control output • Properly prioritize the work orders

45. Operation Sequencing • APICS Definition: • “A technique for short-term planning of actual jobs to be run in each work center based on capacity and priorities.” • Priority is the sequence in which jobs at a work center should be worked on

46. Operation Sequencing • Dispatching • Is the function of selecting and sequencing available jobs to be run at individual work centers. • Dispatch list: • A listing by operation of all the jobs available to be run at a work center with the job listed in priority order.

47. Operation Sequencing • Dispatching Rules • First Come First Served (FCFS) • Earliest Job Due Date (EDD) • earliest Operation Due Date (ODD) • Shortest Process Time (SPT)

48. Production Reporting • Provides feedback of what is actually happening on the plant floor. • Used by PAC to establish proper priorities • Types of information: • Order status • Weekly input/output by dept • Exception reports • Inventory status • Performance summaries

49. Summary • Production Activity Control is concerned with converting material requirements plan into action, reporting the results achieved, and when required, revising plans and actions to meet required results • Order release, dispatching, and progress reporting are the three primary functions.