32, 33, 34, 35, 36 Synchronous Manufacturing

8/12/2019 32, 33, 34, 35, 36 Synchronous Manufacturing

1/22

Synchronous Manufacturing

Theory of constraints


2/22

Basic Ideas

THE GOAL by Goldratt

Goal of the organization

Role of constraints

What to produce and how much

Statistical fluctuations, Random events anddependent events

Principles of SM

Drum buffer rope


3/22

Goal

The goal of every business organization is to

make money, both now and in the future.

Throughput: This is the quantity of money that

the organization generates through sales in a

given period of time.

Inventory: This is the quantity of money invested

in materials that the organization intends to sell. Operating expense: This is the quantity of money

spent in converting inventory to throughput.


4/22

Role of constraints

A constraint is any element that prevents the systemfrom attaining its goal.

Marketing constraints: The limit to which the productscan be sold

Production (capacity) constraints: This limits theproduction quantities

Material constraints: The limit to which material isavailable for production

Logistical: Time taken to carry out activities Managerial: Policies of the organization

Behavioral constraints: Operating decision making rules


5/22

Two types of resources

Bottlenecks: Any resource whose demand on

it is more than its capacity

Capacity constrained Resource (CCR): A

resource which can become a bottleneck

when not properly scheduled.


6/22

Exercise

A company makes a single product whose weeklydemand is 100. Identify the constraint when

The company works 8 hour shifts (5 days) andtakes 20 minutes to make the product

The company takes 30 minutes to make eachproduct

The supplier can give raw material at the rate of15/day

The supplier can give 25 units per day but theorganization takes two days to place the order?


7/22

Solution

The production capacity is 3 x 5 x 8 = 120. The constraint is thedemand and hence marketing is the constraint. The companyshould try and increase the demand.

The production capacity is 2 x 5 x 8 = 80. The capacity is the

constraint. The capacity has to be increased to meet the demand.

The total raw material available is 15 x 5 = 75. The supplier is theconstraint. The company should increase the material received fromthe supplier. They should introduce new suppliers who can supply

the required quantities.

The total raw material available in the week now is 3 x 25 = 75. Thesupplier is unable to deliver the required 100 because of thelogistical constraints and policies of the organization.


8/22

What to produce and how much?

Consider three products A, B and C whose selling price(per unit) are Rs 80, 45, 60 respectively. The unit rawmaterial costs are Rs 70, 30, 40 respectively. The timetaken to produce is 4/hour, 5/hour and 3/hour

respectively. Which product should the organizationchoose?

If the decision is based on maximum SP, we choose A.

If we choose based on gross profit, the values are 10,15 and 20. We choose C.

If we choose based on time to produce, the grossprofit/hour is 40, 75 and 60. We choose B.


9/22

Example

Consider 3 products A, B and C and two

machines. The profits are 40, 30 and 35. The

unit processing times in the two machines M1

and M2 are 15, 16, 12 and 14, 11, 9 minutes

respectively. A total time of 2400 minutes is

available in a week. The weekly demands for

the products are 70, 80 and 60 respectively.Find the production quantities using the TOC

rule?


10/22

Linear Programming and TOC rule

The weekly demands for the products are 70, 80 and 60respectively. Find the production quantities using the TOC

rule?

The time required on M1 is 70 x 15 + 80 x 16 + 60 x 12 = 3050 The time required on M2 is 70 x 14 + 80 x 11 + 60 x 9 = 2400.

Machine M1 is the bottleneck. M2 has enough capacity

The coefficients are 40/15, 30/16, 35/12 = 2.66, 1.875, 2.9166

We produce C first followed by A and then B. The time

required to produce 60 of C is 720. A balance of 1680 is

available. The time to produce 70 of A is 1050 and a balance

of 630 is available. We can produce 630/16 = 39.375. The

profit is 6081.25.


11/22

Example

Consider 3 products A, B and C and two

machines. The profits are 40, 30 and 35. The

unit processing times in the two machines M1

and M2 are 15, 16, 12 and 14, 14, 15 minutes

respectively. A total time of 2400 minutes is

available in a week. The weekly demands for

the products are 70, 80 and 60 respectively.Find the production quantities using the TOC

rule?


12/22

Solution

The capacities required for 70A, 80B and 60C

on M1 and M2 are 3050 and 3000. Both are

bottlenecks. We choose M1 (maximum

bottleneck) and apply the TOC rule to get A =

70, B = 39.375 and C = 60. The capacity

required in M2 for these quantities = 70 x 14 +

39.375 x 14 + 60 x 12 = 2431.25 which exceedsthe available capacity of 2400.


13/22

Solution

Maximize 40A + 30B + 35C

Subject to 15A + 16B + 12C 2400

14A + 14B + 15C 2400

A 70, B 80, C 60

A, B, C 0.

The optimum solution by simplex algorithm is A = 70, B = 37.14 andC = 60 with Z = 6014.2.

If we had chosen M2 as the first bottleneck and applied TC rule wewould have got the solution A = 70, B = 37.14 and C = 60 for whichM1 has enough capacity. This solution is optimal.


14/22


15/22

Principles of SM

SM1 - Do not focus on balancing the capacities. Balance theflow

SM2: Marginal value of time at a bottleneck resource is equalto the throughput of the product.

SM3: Marginal value of time at a nonbottleneck is negligible.

SM4: Level of utilization of a non bottleneck resource iscontrolled by other constraints in the system.

SM5: Resources should be utilized and not simply activated.Activation refers to employment of a resource to process

material while utilization is activation that increasesthroughput.

SM6: Transfer batch need not and should not be equal toprocess batch.

SM7: Process batch should be variable along its route and

over time.


16/22

Exercise

Consider a manufacturing system with threemachines M1, M2 and M3. The time available is16 hours. Two products P and Q are made and go

through the three machines. M1 can produce at6/hour, M2 at 3/hour and M3 at 4/hour of P. M1can produce at 9/hour, M2 at 6/hour and M3 at7/hour of Q. The changeover is 30 minutes each

machine from P to Q and back. The demand is for20 of P and for 50 of Q. Apply the principles ofSM through this example?


17/22

Solution

Among the machines M2 is the bottleneck for P (and Q). M2 can make 20of P and 45 of Q in 8 hours. The actual bottleneck is the demand.

All three machines should produce only 20 of P though each machine can

produce more than 20 of P in 8 hours. This explains that we should

balance the flow and not the capacity. If we produced based on capacity,M1 can make 48, m2 can make 24 and M3 can make 32. We will sell only

20 and the additional quantities made will be waste. This would have led

to activation and not utilization.

The utilization of the bottleneck machine for 8 hours will be approximately90% (we have added a set up of 30 minutes to the time to produce 20 of

P). M2 has a utilization of 52% and M3 has a utilization of 70%. We

observe that the utilization of M1 and M3 depend on the constraint in the

system which is the market. If the market had demanded 30, then M2 can

make only 24 and will become the constraint and the utilizations of M1and M3 would have increased since they would have made 24 of P.


18/22

Solution

Considering product Q, the demand is 50 but 2 can make only 48.We have a left over time of 0.83 hour on M2 in which we can have achangeover to Q which would take 30 minutes. The remaining timeis just about sufficient to make 50 of Q. Now Q will have 100%utilization and becomes the bottleneck. Its marginal value becomesthe throughput. If the demand for P or Q increases, every minutegained in M2 is precious.

Machines M1 and M3 have extra time and hence there is nomarginal value associated with these two machines.

Considering that M2 is the bottleneck when we consider both P andQ together, we should transport every piece from M1 to M2 so thatM2 is utilized. M2 will have a production batch of 20 but will have atransportation batch of 1 to it from M1.


19/22


20/22

ControlDrum buffer rope

The manufacturing system (A to C) has threemachines and an assembly (D). Product P hastwo raw materials, R and S. R gets processed in Aand then B and goes to assembly. S goes to C and

then to assembly. A, B, C and D can do 40, 20, 30and 35/hour. The demand is 25/hour. Assumethat there is a second product Q that has thesame process sequence. The rates are 30, 25, 40

and 30/hour. The demand is 25/hour. Figure 8.1shows the manufacturing process. Determine theschedule using principles of TOC?


21/22

Solution

We consider product P first. Machine B is the bottleneck with 20/hour.Since the demand is 25/hour, the system can produce only 20/hour. All themachines and assembly produce 20/hour. The drum buffer is in front of Bso that the bottleneck is not starved. There is an assembly buffer betweenmachine C and D so that the assembly is not starved. There is a shippingbuffer after the assembly so that there is some buffer between assembly

and the demand.

Let the drum buffer be 30 minutes, shipping buffer be 20 minutes andassembly buffer be 10 minutes. To make 20 of P, machines A, B, C and Dtake 30, 60, 40 and 34.2 minutes. We take the assembly time as 35minutes. The release for A is time for A, drum buffer, B, assembly and

shipping buffer. This is equal to 30 + 30 + 60 + 35 + 20 = 175 minutes.Release for C is the time for C, assembly buffer, assembly time andshipping buffer. This is equal to 40 + 10 + 35 + 20 = 105 minutes. Materialfor 20 can be release at A 175 minutes before the end of the hour and 105minutes before for C.


22/22

Solution

If we consider a transfer batch of 10, the releasetimes become 130 minutes before for A and 85minutes before for C.

For product Q, the bottleneck is the demand. Therelease times with only shipping buffer are 148minutes before for A and 90 minutes before for C.We can add an assembly buffer of 10 minutes

and make it 158 minutes for A and 100 minutesfor C. We release material for 20 units of Q tomeet the demand by the hour.

Documents

32, 33, 34, 35, 36 Synchronous Manufacturing