Synchronous Manufacturing andSynchronous Manufacturing andthe Theory of Constraintsthe Theory of Constraints
2
Synchronous Manufacturing and the Theory of Constraints
• The Goal of the firm
• The hockey-stick phenomenon
• Performance measurement
• Capacity and flow issues
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Some Capacity Related Terminology
• Capacity– Available time for production
• Bottleneck– Capacity is less than demand placed on resource
• Nonbottleneck– Capacity is greater than demand placed on
resource• Capacity-constrained resource (CCR)
– Capacity is close to demand placed on resource
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Bottlenecks and CCRsFlow-Control Situations
• A bottleneck – (1) with no setup required when changing from
one product to another– (2) with setup times required to change from one
product to another• A capacity constrained resource (CCR)
– (3) with no setup required to change from one product to another
– (4) with setup time required when changing from one product to another
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What’s Going to Happen?
X Y Market
Case A
X YBottleneck Nonbottleneck
Demand/month 200 units 200 unitsProcess time/unit 1 hour 45 minsAvail. time/month 200 hours 200 hours
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What’s Going to Happen?
Y X Market
Case B
X YBottleneck Nonbottleneck
Demand/month 200 units 200 unitsProcess time/unit 1 hour 45 minsAvail. time/month 200 hours 200 hours
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What’s Going to Happen?
X Y
Assembly
MarketCase C
X YBottleneck Nonbottleneck
Demand/month 200 units 200 unitsProcess time/unit 1 hour 45 minsAvail. time/month 200 hours 200 hours
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What’s Going to Happen?
X Y
Market MarketCase D
X YBottleneck Nonbottleneck
Demand/month 200 units 200 unitsProcess time/unit 1 hour 45 minsAvail. time/month 200 hours 200 hours
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Components of Production Cycle Time
• Setup time– the time that a part spends waiting for a
resource to be set up to work on this same part• Process time
– the time that the part is being processed• Queue time
– the time that a part waits for a resource while the resource is busy with something else
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Components of Production Cycle Time
• Wait time– the time that a part waits not for a resource but
for another part so that they can be assembled together
• Idle time– the unused time
• the cycle time less the sum of the setup time, processing time, queue time, and wait time
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Saving Time
Bottleneck Nonbottleneck
What are the consequences of saving time at each process?
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Drum, Buffer, Rope
A B C D E F
Bottleneck (Drum)
Inventorybuffer
(time buffer)Communication
(rope)
Market
Module 2
4
Goldratt Proclaims
The goal of a firm is to make money.
3
The Hockey Stick Phenomenon
• The end-of-period rush!
Period1 2 3 4
Output($)
5
Performance MeasurementFinancial
• Net profit– an absolute measurement in dollars
• Return on investment– a relative measure based on investment
• Cash flow– a survival measurement
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Performance MeasurementOperational
• 1. Throughput– the rate at which money is generated by the
system through sales• 2. Inventory
– all the money that the system has invested in purchasing things it intends to sell
• 3. Operating expenses– all the money that the system spends to turn
inventory into throughput
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Productivity• Does not guarantee profitability
– Has throughput increased?
– Has inventory decreased?
– Have operational expenses decreased?
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Unbalanced Capacity• Earlier, we discussed balancing assembly
lines.
– The goal was constant cycle time across all stations
• Synchronous manufacturing views constant workstation capacity as a bad decision.
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The Statistics of Dependent Events
• Rather than balancing capacities, the flow of product through the system should be balanced
Process Time (B)Process Time (A)
Thank You
Gopakumar S Binisha Manu