Chapter 16

1 1 2002 South-Western/Thomson Learning 2002 South-Western/Thomson Learning TMTM

Slides preparedSlides preparedby John Loucksby John Loucks

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Chapter 16Chapter 16Chapter 16Chapter 16

Manufacturing Operations SchedulingManufacturing Operations Scheduling

B2 [----------]B2 [----------] E5 [--------------E5 [-------------- P9 [---]P9 [---] D1 [--------D1 [-------- X8 ----]X8 ----] C6 [-C6 [-

3 3 44 55 66 77 88

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OverviewOverviewOverviewOverview

Scheduling Process-Focused ManufacturingScheduling Process-Focused Manufacturing Scheduling Product-Focused ManufacturingScheduling Product-Focused Manufacturing Computerized Scheduling SystemsComputerized Scheduling Systems Wrap-Up: What World-Class Companies DoWrap-Up: What World-Class Companies Do

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SchedulingScheduling

Process-FocusedProcess-Focused

ManufacturingManufacturing

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Process-Focused ManufacturingProcess-Focused ManufacturingProcess-Focused ManufacturingProcess-Focused Manufacturing

Process-focused factories are often called Process-focused factories are often called job shopsjob shops.. A job shop’s work centers are organized around A job shop’s work centers are organized around

similar types of equipment or operations.similar types of equipment or operations. Workers and machines are flexible and can be Workers and machines are flexible and can be

assigned to and reassigned to many different orders.assigned to and reassigned to many different orders. Job shops are complex to schedule.Job shops are complex to schedule.

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Scheduling and Shop-Floor DecisionsScheduling and Shop-Floor DecisionsScheduling and Shop-Floor DecisionsScheduling and Shop-Floor Decisions

MaterialMaterialRequirementsRequirementsPlan (MRP)Plan (MRP)

CapacityCapacityRequirementsRequirementsPlan (CRP)Plan (CRP)

Order-Order-Processing orProcessing orRouting PlansRouting Plans

Planned Planned Order ReleasesOrder Releases

ReportReport

Work CenterWork CenterLoading andLoading and

Overtime PlanOvertime Plan

Assignment ofAssignment ofOrders toOrders to

Work CentersWork Centers

MasterMasterProductionProduction

Schedule (MPS)Schedule (MPS)

Product DesignProduct Designandand

Process PlansProcess Plans

Day-to-Day Scheduling and Shop-Floor DecisionsDay-to-Day Scheduling and Shop-Floor Decisions

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Pre-production PlanningPre-production PlanningPre-production PlanningPre-production Planning

Design the product in customer orderDesign the product in customer order Plan the operations the product must pass through ..... Plan the operations the product must pass through .....

this is the this is the routing planrouting plan Work moves between operations on a Work moves between operations on a move ticketmove ticket

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Common Shop Floor Control ActivitiesCommon Shop Floor Control ActivitiesCommon Shop Floor Control ActivitiesCommon Shop Floor Control Activities

The production control department controls and The production control department controls and monitors order progress through the shop.monitors order progress through the shop. Assigns priority to ordersAssigns priority to orders Issues dispatching listsIssues dispatching lists Tracks WIP and keeps systems updatedTracks WIP and keeps systems updated Controls input-output between work centersControls input-output between work centers Measures efficiency, utilization, and productivity Measures efficiency, utilization, and productivity

of shopof shop

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Shop Floor Planning and ControlShop Floor Planning and ControlShop Floor Planning and ControlShop Floor Planning and Control

Input-Output ControlInput-Output Control Gantt ChartGantt Chart Finite and Infinite LoadingFinite and Infinite Loading Forward and Backward SchedulingForward and Backward Scheduling

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Input-Output ControlInput-Output ControlInput-Output ControlInput-Output Control

Input-output controlInput-output control identifies problems such as identifies problems such as insufficient or excessive capacity or any issues that insufficient or excessive capacity or any issues that prevents the order from being completed on time.prevents the order from being completed on time.

Input-output control reportInput-output control report compares planned and compares planned and actual input, planned and actual output, and planned actual input, planned and actual output, and planned and actual WIP in each time periodand actual WIP in each time period

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Input-Output Control ReportInput-Output Control ReportInput-Output Control ReportInput-Output Control Report

Week:Week: -1-1 1 1 22 33 44

Planned input: labor-hrsPlanned input: labor-hrs 100100 5050 4040 100100Actual input: labor-hrsActual input: labor-hrs 5050 4040 3030 8080Cumulative deviationCumulative deviation -50-50 -60-60 -70-70 -90-90

Planned output: labor-hrsPlanned output: labor-hrs 120120 7070 5050 100100Actual output: labor-hrsActual output: labor-hrs 110110 5050 2020 7070Cumulative deviationCumulative deviation -10-10 -30-30 -60-60 -90-90

Planned ending WIP: l-hPlanned ending WIP: l-h 5050 3030 2020 2020Actual ending WIP: l-hActual ending WIP: l-h 7070 1010 00 1010 2020

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Gantt ChartsGantt ChartsGantt ChartsGantt Charts

Gantt chartsGantt charts are useful tools to coordinate jobs are useful tools to coordinate jobs through shop; graphical summary of job status and through shop; graphical summary of job status and loading of operationsloading of operations

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Gantt ChartsGantt ChartsGantt ChartsGantt Charts

MachiningMachining

FabricationFabrication

AssemblyAssembly

TestTest

Tue.Tue. Wed.Wed. Thu.Thu. Fri.Fri. Sat.Sat.Work CentersWork Centers Mon.Mon.

E F G

C D E

H C

F

ED

H C D

ScheduledScheduled ProgressProgress Setup, Maint.Setup, Maint.

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Assigning Jobs to Work Centers:Assigning Jobs to Work Centers:How Many Jobs/Day/Work CenterHow Many Jobs/Day/Work CenterAssigning Jobs to Work Centers:Assigning Jobs to Work Centers:

How Many Jobs/Day/Work CenterHow Many Jobs/Day/Work Center

Infinite loadingInfinite loading Assigns jobs to work centers without regard to Assigns jobs to work centers without regard to

capacitycapacity Unless excessive capacity exists, long queues occurUnless excessive capacity exists, long queues occur

Finite loadingFinite loading Uses work center capacity to schedule ordersUses work center capacity to schedule orders Popular scheduling approachPopular scheduling approach Integral part of CRPIntegral part of CRP

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Assigning Jobs to Work Centers:Assigning Jobs to Work Centers:Which Job Gets Built First?Which Job Gets Built First?

Assigning Jobs to Work Centers:Assigning Jobs to Work Centers:Which Job Gets Built First?Which Job Gets Built First?

Forward schedulingForward scheduling Jobs are given earliest available time slot in Jobs are given earliest available time slot in

operationoperation excessive WIP usually resultsexcessive WIP usually results

Backward schedulingBackward scheduling Start with promise date and work backward Start with promise date and work backward

through operations reviewing lead times to through operations reviewing lead times to determine when a job has to pass through each determine when a job has to pass through each operationoperation

Less WIP but must have accurate lead timesLess WIP but must have accurate lead times

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Order-Sequencing ProblemsOrder-Sequencing ProblemsOrder-Sequencing ProblemsOrder-Sequencing Problems

Sequencing RulesSequencing Rules Criteria for Evaluating Sequencing RulesCriteria for Evaluating Sequencing Rules Comparison of Sequencing RulesComparison of Sequencing Rules Controlling Changeover CostsControlling Changeover Costs Minimizing Total Production TimeMinimizing Total Production Time

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Order-Sequencing ProblemsOrder-Sequencing ProblemsOrder-Sequencing ProblemsOrder-Sequencing Problems

We want to determine the sequence in which we will We want to determine the sequence in which we will process a group of waiting orders at a work center.process a group of waiting orders at a work center.

Many different sequencing rules can be followed in Many different sequencing rules can be followed in setting the priorities among orders.setting the priorities among orders.

There are numerous criteria for evaluating the There are numerous criteria for evaluating the effectiveness of the sequencing rules.effectiveness of the sequencing rules.

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Order-Sequencing RulesOrder-Sequencing RulesOrder-Sequencing RulesOrder-Sequencing Rules

First-Come First-Served (FCFS)First-Come First-Served (FCFS)Next job to process is the one that arrived first Next job to process is the one that arrived first among the waiting jobsamong the waiting jobs

Shortest Processing Time (SPT)Shortest Processing Time (SPT)Next job to process is the one with the shortest Next job to process is the one with the shortest processing time among the waiting jobsprocessing time among the waiting jobs

Earliest Due Date (EDD)Earliest Due Date (EDD)Next job to process is the one with the earliest Next job to process is the one with the earliest due (promised finished) date among the waiting due (promised finished) date among the waiting jobsjobs

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Order-Sequencing RulesOrder-Sequencing RulesOrder-Sequencing RulesOrder-Sequencing Rules

Least Slack (LS)Least Slack (LS)Next job to process is the one with the least [time Next job to process is the one with the least [time to due date to due date minusminus total remaining processing total remaining processing time] among the waiting jobstime] among the waiting jobs

Critical Ratio (CR) Critical Ratio (CR) Next job to process is the one with the least [time Next job to process is the one with the least [time to due date to due date divided bydivided by total remaining processing total remaining processing time] among the waiting jobstime] among the waiting jobs

Least Changeover Cost (LCC)Least Changeover Cost (LCC)Sequence the waiting jobs such that total machine Sequence the waiting jobs such that total machine changeover cost is minimizedchangeover cost is minimized

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Evaluating the EffectivenessEvaluating the Effectivenessof Sequencing Rulesof Sequencing Rules

Evaluating the EffectivenessEvaluating the Effectivenessof Sequencing Rulesof Sequencing Rules

Average flow timeAverage flow time - average amount of time jobs - average amount of time jobs spend in shopspend in shop

Average number of jobs in systemAverage number of jobs in system - - Average job latenessAverage job lateness - average amount of time job’s - average amount of time job’s

completion date exceeds its promised delivery datecompletion date exceeds its promised delivery date Changeover costChangeover cost - total cost of making machine - total cost of making machine

changeovers for group of jobschangeovers for group of jobs

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Experience Says:Experience Says:Experience Says:Experience Says:

First-come-first-servedFirst-come-first-served Performs poorly on most evaluation criteriaPerforms poorly on most evaluation criteria Does give customers a sense of fair playDoes give customers a sense of fair play

Shortest processing timeShortest processing time Performs well on most evaluation criteriaPerforms well on most evaluation criteria But have to watch out for long-processing-time But have to watch out for long-processing-time

orders getting continuously pushed backorders getting continuously pushed back Critical ratioCritical ratio

Works well on average job lateness criterionWorks well on average job lateness criterion May focus too much on jobs that cannot be May focus too much on jobs that cannot be

completed on time, causing others to be late too.completed on time, causing others to be late too.

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Example: Sequencing RulesExample: Sequencing RulesExample: Sequencing RulesExample: Sequencing Rules

Use the FCFS, SPT, and Critical Ratio rules to Use the FCFS, SPT, and Critical Ratio rules to sequence the five jobs below. Evaluate the rules on sequence the five jobs below. Evaluate the rules on the bases of average flow time, average number of the bases of average flow time, average number of jobs in the system, and average job lateness.jobs in the system, and average job lateness.

JobJob Processing TimeProcessing Time Time to Promised Time to Promised CompletionCompletion

AA 6 hours 6 hours 10 hours10 hoursBB 12 12 1616CC 9 9 8 8DD 14 14 1414EE 8 8 7 7

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FCFS RuleFCFS Rule A > B > C > D > EA > B > C > D > E

Processing Promised FlowProcessing Promised Flow JobJob TimeTime CompletionCompletion TimeTime LatenessLateness AA 6 6 10 10 6 6 0 0 BB 12 12 16 16 1818 2 2 CC 9 9 8 8 2727 19 19 DD 14 14 14 14 4141 27 27 EE 8 8 7 7 4949 4242

4949 141 141 90 90

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FCFS Rule PerformanceFCFS Rule Performance

Average flow time:Average flow time:

141/5 = 28.2 hours141/5 = 28.2 hours Average number of jobs in the system:Average number of jobs in the system:

141/49 = 2.88 jobs141/49 = 2.88 jobs Average job lateness:Average job lateness:

90/5 = 18.0 hours90/5 = 18.0 hours

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SPT RuleSPT Rule A > E > C > B > DA > E > C > B > D

Processing Promised FlowProcessing Promised Flow JobJob TimeTime CompletionCompletion TimeTime LatenessLateness AA 6 6 10 10 6 6 0 0 BB 8 8 7 7 1414 7 7 CC 9 9 8 8 2323 15 15 DD 12 12 16 16 3535 19 19 EE 1414 14 14 4949 3535

4949 127 127 76 76

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SPT Rule PerformanceSPT Rule Performance




76/5 = 15.2 hours76/5 = 15.2 hours

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Critical Ratio RuleCritical Ratio Rule E > C > D > B > AE > C > D > B > A

Processing Promised FlowProcessing Promised Flow JobJob TimeTime CompletionCompletion TimeTime LatenessLateness

E (.875)E (.875) 8 8 7 7 8 8 1 1 C (.889)C (.889) 9 9 8 8 1717 9 9 D (1.00)D (1.00) 14 14 14 14 3131 17 17 B (1.33)B (1.33) 12 12 16 16 4343 27 27 A (1.67)A (1.67) 6 6 10 10 4949 3939

4949 148 148 93 93

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Critical Ratio Rule PerformanceCritical Ratio Rule Performance




93/5 = 18.6 hours93/5 = 18.6 hours

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Comparison of Rule PerformanceComparison of Rule Performance

AverageAverage Average Average AverageAverage Flow Number of JobsFlow Number of Jobs Job Job

Rule Time in System Rule Time in System LatenessLateness

FCFSFCFS 28.2 28.2 2.88 2.88 18.0 18.0

SPTSPT 25.4 25.4 2.59 2.59 15.2 15.2

CRCR 29.6 29.6 3.02 3.02 18.6 18.6

SPT rule was superior for all 3 performance criteria.SPT rule was superior for all 3 performance criteria.

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Controlling Changeover CostsControlling Changeover CostsControlling Changeover CostsControlling Changeover Costs

Changeover costsChangeover costs - costs of changing a processing - costs of changing a processing step in a production system over from one job to step in a production system over from one job to anotheranother Changing machine settingsChanging machine settings Getting job instructionsGetting job instructions Changing materialChanging material Changing toolsChanging tools

Usually, jobs should be processed in a sequence that Usually, jobs should be processed in a sequence that minimizes changeover costsminimizes changeover costs

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Controlling Changeover CostsControlling Changeover CostsControlling Changeover CostsControlling Changeover Costs

Job Sequencing HeuristicJob Sequencing Heuristic First, select the lowest changeover cost among all First, select the lowest changeover cost among all

changeovers (this establishes the first two jobs in changeovers (this establishes the first two jobs in the sequence)the sequence)

The next job to be selected will have the lowest The next job to be selected will have the lowest changeover cost among the remaining jobs that changeover cost among the remaining jobs that follow the previously selected jobfollow the previously selected job

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Example: Minimizing Changeover CostsExample: Minimizing Changeover CostsExample: Minimizing Changeover CostsExample: Minimizing Changeover Costs

Hardtimes Heat Treating Service has 5 jobs Hardtimes Heat Treating Service has 5 jobs waiting to be processed at work center #11. The job-waiting to be processed at work center #11. The job-to-job changeover costs are listed below. What to-job changeover costs are listed below. What should the job sequence be?should the job sequence be?

Jobs That PrecedeJobs That PrecedeAA BB CC DD EE

AA ---- 6565 8080 5050 6262BB 9595 ---- 6969 6767 6565CC 9292 7171 ---- 6767 7575DD 8585 105105 6565 ---- 9595EE 125125 7575 9595 105105 ----

JobsJobsThatThat

FollowFollow

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Example: Minimizing Changeover CostsExample: Minimizing Changeover CostsExample: Minimizing Changeover CostsExample: Minimizing Changeover Costs

Develop a job sequence:Develop a job sequence:A follows D ($50 is the least c.o. cost)A follows D ($50 is the least c.o. cost)C follows A ($92 is the least following c.o. cost)C follows A ($92 is the least following c.o. cost)B follows C ($69 is the least following c.o. cost)B follows C ($69 is the least following c.o. cost)E follows B (E is the only remaining job)E follows B (E is the only remaining job)

Job sequence is D – A – C – B – EJob sequence is D – A – C – B – E

Total changeover cost = $50 + 92 + 69 + 75 = $286Total changeover cost = $50 + 92 + 69 + 75 = $286

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Minimizing Total Production TimeMinimizing Total Production TimeMinimizing Total Production TimeMinimizing Total Production Time

Sequencing n Jobs through Two Work CentersSequencing n Jobs through Two Work Centers When several jobs must be sequenced through two When several jobs must be sequenced through two

work centers, we may want to select a sequence work centers, we may want to select a sequence that must hold for both work centersthat must hold for both work centers

Johnson’s rule can be used to find the sequence Johnson’s rule can be used to find the sequence that minimizes the total production time through that minimizes the total production time through both work centersboth work centers

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Johnson’s RuleJohnson’s RuleJohnson’s RuleJohnson’s Rule

1. Select the shortest processing time in either work 1. Select the shortest processing time in either work centercenter

2. If the shortest time is at the first work center, put the 2. If the shortest time is at the first work center, put the job in the first unassigned slot in the schedule. If the job in the first unassigned slot in the schedule. If the shortest time is at the second work center, put the job shortest time is at the second work center, put the job in the last unassigned slot in the schedule. in the last unassigned slot in the schedule.

3. Eliminate the job assigned in step 2.3. Eliminate the job assigned in step 2.

4. Repeat steps 1-3, filling the schedule from the front 4. Repeat steps 1-3, filling the schedule from the front and back, until all jobs have been assigned a slot.and back, until all jobs have been assigned a slot.

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Example: Minimizing Total Production TimeExample: Minimizing Total Production TimeExample: Minimizing Total Production TimeExample: Minimizing Total Production Time

It is early Saturday morning and The Finest It is early Saturday morning and The Finest Detail has five automobiles waiting for detailing Detail has five automobiles waiting for detailing service. Each vehicle goes through a thorough service. Each vehicle goes through a thorough exterior wash/wax process and then an interior exterior wash/wax process and then an interior vacuum/shampoo/polish process. vacuum/shampoo/polish process.

The entire detailing crew must stay until the The entire detailing crew must stay until the last vehicle is completed. If the five vehicles are last vehicle is completed. If the five vehicles are sequenced so that the total processing time is sequenced so that the total processing time is minimized, when can the crew go home. They will minimized, when can the crew go home. They will start the first vehicle at 7:30 a.m.start the first vehicle at 7:30 a.m.

Time estimates are shown on the next slide.Time estimates are shown on the next slide.

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ExteriorExterior InteriorInteriorJobJob Time (hrs.)Time (hrs.) Time (hrs.)Time (hrs.)

CadillacCadillac 2.02.0 2.52.5BentleyBentley 2.12.1 2.42.4LexusLexus 1.91.9 2.22.2

PorschePorsche 1.81.8 1.61.6InfinitiInfiniti 1.51.5 1.41.4

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Johnson’s RuleJohnson’s Rule

Least Least WorkWork ScheduleScheduleTimeTime Job Job CenterCenter Slot Slot

1.4 1.4 InfinitiInfiniti InteriorInterior 5 5thth

1.61.6 PorschePorsche InteriorInterior 4 4thth

1.91.9 Lexus Lexus ExteriorExterior 1 1stst

2.02.0 CadillacCadillac ExteriorExterior 2 2ndnd

2.12.1 BentleyBentley ExteriorExterior 3 3rdrd

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ExteriorExterior

InteriorInterior

0 1.9 3.9 6.0 7.8 9.3 12.00 1.9 3.9 6.0 7.8 9.3 12.0

0 1.9 4.1 6.6 9.0 10.6 12.00 1.9 4.1 6.6 9.0 10.6 12.0

LL CC BB

LL

PP II

Idle CC BB PP II

Idle

It will take from 7:30 a.m. until 7:30 p.m. (not It will take from 7:30 a.m. until 7:30 p.m. (not allowing for breaks) to complete the five vehicles.allowing for breaks) to complete the five vehicles.

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SchedulingScheduling

Product-FocusedProduct-Focused

ManufacturingManufacturing

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Product-Focused SchedulingProduct-Focused SchedulingProduct-Focused SchedulingProduct-Focused Scheduling

Two general types of product-focused production:Two general types of product-focused production: BatchBatch - large batches of several standardized - large batches of several standardized

products producedproducts produced ContinuousContinuous - few products produced - few products produced

continuously.... minimal changeoverscontinuously.... minimal changeovers

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Scheduling DecisionsScheduling DecisionsScheduling DecisionsScheduling Decisions

If products are produced in batches on the same If products are produced in batches on the same production lines:production lines: How large should production lot size be for each How large should production lot size be for each

product?product? When should machine changeovers be scheduled?When should machine changeovers be scheduled?

If products are produced to a delivery schedule:If products are produced to a delivery schedule: At any point in time, how many products should At any point in time, how many products should

have passed each operation if time deliveries are to have passed each operation if time deliveries are to be on schedule?be on schedule?

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Batch SchedulingBatch SchedulingBatch SchedulingBatch Scheduling

EOQ for Production Lot SizeEOQ for Production Lot Size How many units of a single product should be How many units of a single product should be

included in each production lot to minimize annual included in each production lot to minimize annual inventory carrying cost and annual machine inventory carrying cost and annual machine changeover cost?changeover cost?

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Example: Example: EOQ for Production LotsEOQ for Production LotsExample: Example: EOQ for Production LotsEOQ for Production Lots

CPC, Inc. produces four standard electronic CPC, Inc. produces four standard electronic assemblies on a produce-to-stock basis. The annual assemblies on a produce-to-stock basis. The annual demand, setup cost, carrying cost, demand rate, and demand, setup cost, carrying cost, demand rate, and production rate for each assembly are shown on the production rate for each assembly are shown on the next slide.next slide.a) What is the economic production lot size for each a) What is the economic production lot size for each

assembly?assembly?b) What percentage of the production lot of power b) What percentage of the production lot of power units is being used during its production run?units is being used during its production run?c) For the power unit, how much time will pass c) For the power unit, how much time will pass between production setups?between production setups?

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AnnualAnnual SetupSetup CarryCarry DemandDemand Prod.Prod.DemandDemand CostCost CostCost RateRate RateRate

Power UnitPower Unit 5,000 5,000 $1,200$1,200 $6$6 2020 200200

ConverterConverter 10,00010,000 600 600 4 4 4040 300300

EqualizerEqualizer 12,00012,000 1,500 1,500 1010 4848 100100

TransformerTransformer 6,000 6,000 400 400 2 2 2424 50 50

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Economic Production Lot SizesEconomic Production Lot Sizes

EOQ = (2DS/C[p/(p-d)]EOQ = (2DS/C[p/(p-d)]

1EOQ = (2(5,000)(1,200)/6[200/(200-20)] 1, 490.71EOQ = (2(5,000)(1,200)/6[200/(200-20)] 1, 490.7

2EOQ = (2(10,000)(600)/4[300/(300-40)] 1,860.52EOQ = (2(10,000)(600)/4[300/(300-40)] 1,860.5

3EOQ = (2(12,000)(1,500)/10[100/(100-48)] 2,631.23EOQ = (2(12,000)(1,500)/10[100/(100-48)] 2,631.2

4EOQ = (2(6,000)(400)/2[50/(50-24)] 2,148.34EOQ = (2(6,000)(400)/2[50/(50-24)] 2,148.3

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% of Power Units Used During Production% of Power Units Used During Production

d/p = 20/200 = .10 or 10%d/p = 20/200 = .10 or 10%

Time Between Setups for Power UnitsTime Between Setups for Power Units

EOQ/d = 1,490.7/20 = 74.535 daysEOQ/d = 1,490.7/20 = 74.535 days

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Limitations of EOQ Production Lot SizeLimitations of EOQ Production Lot Size Uses annual “ballpark” estimates of demand and Uses annual “ballpark” estimates of demand and

production rates, not the most current estimatesproduction rates, not the most current estimates Not a comprehensive scheduling technique – only Not a comprehensive scheduling technique – only

considers a single product at a timeconsiders a single product at a time Multiple products usually share the same scarce Multiple products usually share the same scarce

production capacityproduction capacity

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Run-Out MethodRun-Out Method Attempts to use the total production capacity Attempts to use the total production capacity

available to produce just enough of each product available to produce just enough of each product so that if all production stops, inventory of each so that if all production stops, inventory of each product runs out at the same timeproduct runs out at the same time

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Example: Run-Out MethodExample: Run-Out MethodExample: Run-Out MethodExample: Run-Out Method

QuadCycle, Inc. assembles, in batches, four QuadCycle, Inc. assembles, in batches, four bicycle models on the same assembly line. The bicycle models on the same assembly line. The production manager must develop an assembly production manager must develop an assembly schedule for March.schedule for March.

There are 1,000 hours available per month for There are 1,000 hours available per month for bicycle assembly work. Using the run-out method bicycle assembly work. Using the run-out method and the pertinent data shown on the next slide, and the pertinent data shown on the next slide, develop an assembly schedule for March.develop an assembly schedule for March.

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AssemblyAssembly MarchMarch AprilAprilInventoryInventory TimeTime Forec.Forec. Forec.Forec.On-HandOn-Hand RequiredRequired DemandDemand

DemandDemandBicycleBicycle (Units)(Units) (Hr/Unit)(Hr/Unit) (Units)(Units) (Units)(Units)

RazerRazer 100100 .3.3 400400 400400SplicerSplicer 600600 .2.2 900900 900900TrackerTracker 500500 .6.6 1,5001,500 1,5001,500HiLanderHiLander 200200 .1.1 500500 500500

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Convert inventory and forecast into assembly hoursConvert inventory and forecast into assembly hours

Assemb.Assemb. MarchMarch MarchMarchInvent.Invent. TimeTime Forec.Forec. Invent.Invent. Forec.Forec.

On-HandOn-Hand Req’d.Req’d. Dem.Dem. On-HandOn-Hand Dem.Dem.BicycleBicycle (Units)(Units) (Hr/Unit)(Hr/Unit) (Units)(Units) (Hours)(Hours) (Hours)(Hours)

RazerRazer 100100 .3.3 400400 3030 120120SplicerSplicer 600600 .2.2 900900 120120 180180TrackerTracker 500500 .6.6 1,5001,500 300300 900900HiLanderHiLander 200200 .1.1 500500 2020 5050

TotalTotal 470470 1,2501,250

(1)(1) (2) (2) (3) (3) (4) (4) (5) (5)

(1) x (2)(1) x (2) (2) x (4)(2) x (4)

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Compute aggregate run-out time in monthsCompute aggregate run-out time in months

Aggregate Run-out Time =Aggregate Run-out Time =

== [(Total Inventory On-Hand in Hours)[(Total Inventory On-Hand in Hours)

+ (Total Assembly Hours Available per + (Total Assembly Hours Available per Month)Month)

(March’s Forecasted Demand in Hours)](March’s Forecasted Demand in Hours)]

/ (April’s Forecasted Demand in Hours)/ (April’s Forecasted Demand in Hours)

= (470 + 1,000 = (470 + 1,000 1,250)/1,250 = .176 months 1,250)/1,250 = .176 months

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Develop March’s Production ScheduleDevelop March’s Production Schedule

March’sMarch’s March’sMarch’sDesiredDesired DesiredDesired AssemblyAssemblyEndingEnding End.Inv.End.Inv. RequiredRequired TimeTime

InventoryInventory & Forec.& Forec. ProductionProduction AllocatedAllocatedBicycleBicycle (Units)(Units) (Units)(Units) (Units)(Units) (Hours)(Hours)

RazerRazer 7070 470470 370370 111.0111.0SplicerSplicer 158158 1,0581,058 458458 91.691.6TrackerTracker 264264 1,7641,764 1,2641,264 758.4758.4HiLanderHiLander 8888 588588 388388 38.838.8

999.8999.8

(6)(6) (7) (7) (8) (8) (9) (9)

(3) x .176(3) x .176 (3) + (6)(3) + (6) (7) (7) (1) (1) (8) x (2)(8) x (2)

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Computerized SchedulingComputerized SchedulingComputerized SchedulingComputerized Scheduling

Develops detailed schedules for each work center Develops detailed schedules for each work center indicating starting and ending timesindicating starting and ending times

Develops departmental schedulesDevelops departmental schedules Generates modified schedules as orders moveGenerates modified schedules as orders move Many packages available.... select one most Many packages available.... select one most

appropriate for your businessappropriate for your business

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Wrap-Up: World-Class PracticeWrap-Up: World-Class PracticeWrap-Up: World-Class PracticeWrap-Up: World-Class Practice

In process-focused factories:In process-focused factories: MRP II refined.... promises are met, shop loading MRP II refined.... promises are met, shop loading

is near optimal, costs are low, quality is highis near optimal, costs are low, quality is high In product-focused factories:In product-focused factories:

EOQ for standard parts containers, this sets S, lot EOQ for standard parts containers, this sets S, lot sizes are lower, inventories slashed, customer sizes are lower, inventories slashed, customer service improvedservice improved

Scheduling is integral part of a computer information Scheduling is integral part of a computer information systemsystem

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End of Chapter 16End of Chapter 16End of Chapter 16End of Chapter 16

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Chapter 16