CPIM - Execution and Control of Operations (ECO)

Lead time management

Calculation of Lead Times - Separate lead time into queue and nonqueue time. - Convert nonqueue time to days. - Assign queue time based on routing distance to next work center. - Calculate lead time as the sum of the queue and nonqueue times.

Measuring Quality-Related Costs

Costs of preventing defects Prevention - Quality engineering, training, and data gathering Appraisal - Testing/reinspection of incoming materials, in-process goods, and final products Costs of failure to meet design specs Internal failure cost - Scrap, rework, retesting, downtime External failure cost - Field servicing, warranty, recalls Optimal point is the intersection of the prevention and failure costs.

Decoupling

Creating independence between supply and use of material. Commonly denotes allocating inventory between operations so that fluctuations in the production rate of the supplying operation do not constrain the production or use rates of the next operation.

Supply Chain Quality Improvement

Cross-functional quality improvement teams Management endorsement Pareto analysis

Group Principles

Cross-functional team: A set of individuals from various departments assigned a specific task such as implementing new computer software. Self-directed work team: Generally, a small, independent, self-organized, and self-controlling group in which members flexibly plan, organize, determine, and manage their duties and actions, as well as perform many other supportive functions.

Additional local design principles to consider in push and pull (lean) manufacturing

- Decoupling point - Appropriate technology and equipment - Job design - Coordination with distribution center and/or - processing center design - Designing a distribution or processing center - Environmental footprint.

Batch Production

- High-variety, low-volume make-to-order products. - Varied routings through general purpose equipment. - Operations time at work centers will vary. - High risk that work arrives at work centers late or early. - Slow throughput. - Work in process builds up. - Capacity required varies by item.

Flow Production

- Standard high-volume products. - Fixed routings: dedicated assembly lines or flow equipment. - Operations time at work centers about the same: balanced. - Flow between work centers is predictable. - Fast throughput. - Low WIP. - Capacity fixed by line.

Benefit/Cost Analysis Process

1) Approximate costs that are one-time costs. 2) Approximate any annual operating costs that are additional. 3) Approximate the annual cost savings 4) Rank the impact of the alternatives in order 5) Measure the impact on customer satisfaction. 6) Calculate net annual operating costs. 7) Calculate annual costs of one-time costs. 8) Calculate total annual costs (sum of net annual costs and the annual costs of one-time costs). 9) Review data and prioritize alternatives.

Principles of Effective Measurement

1.) Define the purpose and use of the measurement. 2.) Call attention to customer-related measurements (for both external and internal customers). 3.) Focus on what is useful—not just the easiest items to gather. 4.) Get participation from all levels of the organization. If the measurement is not useful, it will be ignored. 5.) Provide measurements in as close to real time as possible. Timing impacts diagnosis and implementation. 6.) Include concurrent leading and lagging indicators. 7.) Provide a plan for data collection and storage, analysis, and presentation. Without the intended use, the data collection could be incomplete. 8.) Make data recording, analysis, and presentation simple. Graphical representation of data can be effective. 9.) Periodically evaluate for accuracy, integrity, and usefulness of measurements. 10.) Recognize that measurement alone cannot improve products and processes.

Product Evaluation Methods

100% inspection (every time) Sample (sampling plan) Identifying inspection No inspection Accept supplier certification data

Hoshin

A Japanese word meaning statement of objectives

Process Layout - Functional (Process) Layout

A facility configuration in which operations of a similar nature or function are grouped together; an organizational structure based on departmental specialty (e.g., saw, lathe, mill, heat treat, press). Advantages - High equipment flexibility and need for fewer machines, more specialized supervision, ability to transfer work leads to low risk for loss of production due to machinery breakdowns. Disadvantages - Wait time leads to higher total production time, bottleneck potential is high, higher handling costs due to longer product flow line.

Process Layout - Fixed-Position Layout

A factory layout that plans for the product to be in a set place; the people, machines, and tools are brought to and from the product. Advantages - High independence, high flexibility, low capital investment, low amount of material movement Disadvantages - High effort when moving machines, highly skilled labor needed, limited storage space for materials

Intermittent manufacturing process

A form of manufacturing in which the jobs pass through the functional departments in lots, and each lot may have a different routing. Goods are produced based on customer orders Large varieties are produced, very flexible system The two manufacturing process types that fall into the intermittent manufacturing process category include batch and work center.

Flow manufacturing

A form of manufacturing organization in which machines and operators handle a standard, usually uninterrupted, material flow. The operators generally perform the same operations for each production run. 4 Critical Points - Identify and manage potential bottlenecks. - Identify constraints on resources. - Minimize waste during the manufacturing and assembly process. - Optimize coupling and connectivity.

Quality Tool - Histograms

A graph of contiguous vertical bars representing a frequency distribution in which the groups or classes of items are marked on the x axis and the number of items in each class is indicated on the y axis. The pictorial nature of the histogram lets people see patterns that are difficult to see in a simple table of numbers. Graphically depicts the sorting of data into groups arranged in the shape of a frequency distribution, showing a central tendency and dispersion. Application - Histograms are used to sort data and to support rapid comparison of categories of data.

Control Charts

A graphic comparison of process performance data with predetermined computed control limits. Control Limits - A statistically determined line on a control chart (upper control limit or lower control limit). If a value occurs outside this limit, the process is deemed to be out of control. Typically 3 sigma (99.7) Central tendency. This is where the process typically tends to run. It may or may not be ideal. Data point. This is a sample of measurements taken at a specific time

Scheduling Tool - Operation setback chart

A graphical display of the bill of materials and lead-time information provided by the routing for each part. The horizontal axis provides the lead time from raw materials purchase to component manufacture to assembly of the finished product.

Quality Tool - Scatter Charts

A graphical technique to analyze the relationship between two variables. Two sets of data are plotted on a graph, with the y axis used for the variable to be predicted and the x axis used for the variable to make the prediction. A scatter chart, or diagram, plots data points against two variables that form the chart's x and y axes. Each axis is scaled. The pattern formed by the plotted data describes the correlation between the two variables: The tightness of the clustering indicates the probable strength of the correlation. Application - Scatter charts can be used to test possible causal relationships and narrow focus on subsequent tests. This type of diagram is most useful if the two variables relate to each other.

Assemble to Order (ATO)

A production environment where a good or service can be assembled after receipt of a customer's order. The key components (bulk, semi-finished, intermediate, subassembly, fabricated, purchased, packing, and so on) used in the assembly or finishing process are planned and usually stocked in anticipation of a customer order. Medium to High Volume/Low to Medium variety Cellular process layout Batch or Line process types

Supplier-input-process-output-customer (SIPOC)

A high-level process map that shows substantial subprocesses in an organization's process together with the structure of the process represented by the suppliers, inputs, outputs, and customers. A SIPOC diagram defines the critical aspects of a process without losing the overall perspective. S (supplier). The entity that provides input(s) to a process. I (input). All that is used (mostly as variables) to produce one or more outputs from a process. It is worthwhile to note that infrastructure may not be considered as inputs to a steady-state process since any variability induced by such elements remains fixed over longer periods of time. P (process). Steps or activities carried out to convert inputs to one or more outputs. In a SIPOC, the process steps are shown at a high level. O (output). One or more outcomes or physical products emerging from a process. C (customer). The entity that uses the output(s) of a process.

Process Layout - Cellular Layout

A manufacturing process that produces families of parts within a single line or cell of machines controlled by operators who work only within the line or cell. Also called work cells or cellular manufacturing, is a hybrid of the functional and product-based layouts. Advantages - Minimizes material-handling distances and factory floor space requirements, faster processing time, no work-in-process inventory accumulates, lead times shrink, reduced finished goods inventory. Disadvantages - Works only if products can be grouped into product families, employees know only their job within their cell, locating work centers or cells near each other.

Process Type - Batch Production

A manufacturing technique in which parts are accumulated and processed together in a lot. Batch processing is also called job shop processing. Volume is higher than in MTO but not as high as in MTS mass/continuous production environment. Ex - Clothing lines, pharmaceuticals

Quality function deployment (QFD)

A methodology designed to ensure that all the major requirements of the customer are identified and subsequently met or exceeded through the resulting product design process and the design and operation of the supporting production management system. Market Research Customer Needs Product features Process features Process control features

Lean Production

A philosophy of production that emphasizes the minimization of the amount of all the resources (including time) used in the various activities of the enterprise. It involves identifying and eliminating non-value-adding activities in design, production, supply chain management, and dealing with customers. Objectives of lean - Make only those products and services customers actually want - Match the production rate to the demand rate - Make products and services with perfect quality - Make products and services with the shortest possible lead times - Include only features actually in demand, excluding all else - Keep labor, equipment, materials, and inventory continually in motion, with no waste or unnecessary movement - Build worker learning and growth into each operational activity.

Make to Order (MTO)

A production environment where a good or service can be made after receipt of a customer's order. The final product is usually a combination of standard items and items custom-designed to meet the special needs of the customer. Low to Medium Volume/Medium Variety Functional process layout Work Center or Batch process types

Make to Stock (MTS)

A production environment where products can be and usually are finished before receipt of a customer order. Customer orders are typically filled from existing stocks, and production orders are used to replenish those stocks. High Volume/Low variety Product based layout Line or Continuous process type

Push System

A push execution system, also referred to as an MRP-based execution system, involves forecasting production needs to meet customer demand or make-to-stock requirements. Execution in a push environment - Sequence of work - Setup time and changeovers - Resource constraints - Alternate routing - Scheduling method - Load leveling - Input/Output control

Capacity-constrained resource (CCR)

A resource that is not a constraint but will become a constraint unless scheduled carefully.

Quality Tool - Check Sheets

A simple data-recording device. The check sheet is designed by the user to facilitate the user's interpretation of the results. Application - The check sheets summarizes and categorizes events in real time. The data from check sheets is frequently used to generate further analysis through histograms or Pareto charts.

Flow control

A specific production control system that is based primarily on setting production rates and feeding work into production to meet these planned rates, then monitoring and controlling production.

Management role in quality

A strong management commitment to leadership is important, but even more important is the evidence of leadership in quality by upper management. Create a Quality Vision Build a Quality Culture Types of Change (Breakthrough, continuous) Model Leadership Recruit the Right People Promote Worker Self-Control Serve as Change Agents

House of Quality

A structured process that relates customer-defined attributes to the product's technical features needed to support and generate these attributes. This technique achieves this mapping by means of a six-step process: (1) identification of customer attributes (2) identification of supporting technical features (3) correlation of the customer attributes with the supporting technical features (4) assignment of priorities to the customer requirements and technical features (5) evaluation of competitive stances and competitive products (6) identification of those technical features to be used (deployed) in the final design of the product. HOQ is part of the quality function deployment (QFD) process and forces designers to consider customer needs and the degree to which the proposed designs satisfy these needs.

Input/output control (I/O)

A technique for capacity control where planned and actual inputs and planned and actual outputs of a work center are monitored. Planned inputs and outputs for each work center are developed by capacity requirements planning and approved by manufacturing management. Actual input is compared to planned input to identify when work center output might vary from the plan because work is not available at the work center. Actual output is also compared to planned output to identify problems within the work center.

Juran Trilogy (Quality trilogy)

A three-pronged approach to managing quality proposed by Joseph Juran. The three legs are quality planning (developing the products and processes required to meet customer needs), quality control (meeting product and process goals), and quality improvement (achieving unprecedented levels of performance). Quality Planning - Define your customer, determine their needs, define your product/process Quality Improvement - Repair (Reactive, fix what's broken), Refinement (Proactive, improve process), Renovation (Improvement through innovation), Reinvention (Start over) Quality control - Determine what needs to be measured, set performance goal, gather feedback, take action on the gap between performance and the goal, use of control tools (pareto, flow diagrams, etc.)

Quality Tool - Cause-and-Effect Diagrams

A tool for analyzing process dispersion. It is also referred to as the Ishikawa diagram (because Kaoru Ishikawa developed it) and the fishbone diagram (because the complete diagram resembles a fish skeleton). The diagram illustrates the main causes and subcauses leading to an effect (symptom). 5 Whys approach - The common practice in total quality management is to ask "why" five times when confronted with a problem. By the time the answer to the fifth "why" is found, the ultimate cause of the problem is identified. Fishbone analysis - A technique to organize the elements of a problem or situation to aid in the determination of the causes of the problem or situation. The analysis relates the effect of the environment to the several possible sources of the problem. Application - The cause-and-effect diagram supports analysis of how to solve a problem or capture an opportunity and focus on ways to improve processes. 6 M's Approach - Materials, machines, manpower (people), methods, measurement, and milieu (environment).

Process Layout - Product-Based Layout

A type of layout where resources are arranged sequentially according to the steps required to make a particular complex product.. Advantages - Lower total material-handling costs, less WIP and floor area, simplicity of production control, total production time minimized, high degree of equipment and labor utilization Disadvantages - Limited flexibility, manufacturing costs increase with a fall/decrease in volume, single machine breakdown could shut down whole production line, cannot easily respond to system changes

A3 Problem Solving

A3 thinking and problem solving bring structure and discipline to the PDCA cycle. A one-page story on 11" × 17" paper. Both the results of the problem identification and the planning are presented in a concise report. Hoshin planning A3—used to summarize department and company hoshins Problem-solving A3—used to summarize problems and countermeasures Proposal A3—used to present new ideas Current status A3—used to summarize the current condition of a hoshin, problem, or concern A3 Report components - Title, background, current state, objective, cause and effect, countermeasures, check, action plan

Voice of the customer

Actual customer descriptions in words for the functions and features customers desire for goods and services. In the strict definition, as related to quality function deployment (QFD), the term customer indicates the external customer of the supplying entity. A process used to capture the requirements and/or feedback from the customer (internal or external) to provide the customers with the best in class service/product quality.

Process Type - Line Production

Also called repetitive flow or line flow, is associated with MTS and ATO manufacturing environments. Work processes are arranged according to the progression of steps in making the product. Discrete parts are made by moving from workstation to workstation at a controlled rate, following the operations sequence needed to build the product. High Volume/Low variety Ex - Refrigerators, food processing

Production Leveling

Also referred to as production smoothing or heijunka, is a technique discovered by the Toyota Production System that is used to reduce the amount of waste in the production system so organizations can improve their production efficiency. Production leveling - A production planning method that maintains a stable production rate while varying inventory levels to meet demand. Level schedule - MPS that generates requirements evenly spread over time. In JIT, days customer demand is scheduled to be built on the day its shipped Heijunka: In just-in-time philosophy, an approach to level production throughout the supply chain to match the planned rate of end product sales. Kanban: A method of just-in-time production that uses standard containers or lot sizes with a single card attached to each.

Environmental Footprint

An environmentally responsible business is "a firm that operates in such a way as to minimize detrimental impacts on society" Scrap factor - A factor that expresses the quantity of a particular component that is expected to be scrapped upon receipt from a vendor, completion of production, or while that component is being built into a given assembly. It is usually expressed as a decimal value. Reduction and elimination of hazmat (hazardous materials), efficient use of resources, protecting employee health and improve productivity, reducing waste to the environment. Design for the environment (DFE) - Considering health, safety, and environmental aspects of a product during the design and development phase of product development.

Executing the MRP Schedule - Authorization

Authorization Steps - Receive authorization to release order. - Check tooling and material availability. - Check capacity requirements and availability. - Release order to manufacturing.

PAC Technique - Scheduling

Back scheduling - A technique for calculating operation start dates and due dates. The schedule is computed starting with the due date for the order and working backward to determine the required start date and/or due dates for each operation. Forward scheduling - A scheduling technique where the scheduler proceeds from a known start date and computes the completion date for an order, usually proceeding from the first operation to the last. Dates generated by this technique are generally the earliest start dates for operations. Central point scheduling - A variant of scheduling that employs both forward and backward scheduling, starting from the scheduled start date of a particular operation. Infinite loading - Calculation of the capacity required at work centers in the time periods required regardless of the capacity available to perform this work. Finite loading - Assigning no more work to a work center than the work center can be expected to execute in a given time period.

Collaboration and Visual Techniques - Mitigating Risk

Bathtub Curve - Failures tend to occur in three phases over time and usually produce a curve that looks like a drawing of a bathtub. Three phases: Infant mortality (early life)—Failures occur early, often due to defective parts or improper use. Normal life—Failure rates typically are low but do occur randomly. Wear-out—Failure rates rise because of part wear and aging. Fault Tree Analysis - A logical approach to identify the probabilities and frequencies of events in a system that are most critical to uninterrupted and safe operation. Quality Function Deployment - Also a tool used to mitigate risk by listening closely to customer requirements and translating them into plans to produce specific products.

Six Big Losses

Breakdowns Setup and Adjustments Idling and minor stops Reduced speeds Quality losses Start up

Sustainable management system model

Business case. Includes a review of costs and benefits such as salaries of employees related to the SMS; expected savings in waste disposal, reduced fines, and so on; business opportunities; and internal and external savings. Organizational component. Management buy-in, resources, and a management structure are required for success. Operational component. Link the SMS to the overall strategic plan. Establish procedures, train personnel, and engage stakeholders in the process. Enterprise resource planning (ERP) and IT. Facilitate business operations internally and externally in the supply chain. Monitoring and audits. Review SMS performance and conformance at regular intervals. Initiate corrective and preventive actions as required.

Inputs from MRP and CRP to scheduling and control

Capacity requirements plan is critical to shop floor scheduling and control. If the schedule is not supported by available capacity, shop floor control will not be able to: Decrease backlogs Improve delivery performance Achieve output targets Achieve the material requirements plans that drive the delivery schedules for end items and components to achieve the MPS. MRP provides critical information that supports the authorization and release of work orders and ensures that suppliers provide the right parts at the right time to achieve the MPS.

Supplier certification

Certification procedures verifying that a supplier operates, maintains, improves, and documents effective procedures that relate to the customer's requirements. Such requirements can include cost, quality, delivery, flexibility, maintenance, safety, and ISO quality and environmental standards. Reduction in the cost of quality for buyers: no inspection (appraisal) costs, very low defect handling costs Reduction in internal and external failure costs for suppliers and buyers caused by defective parts Reduction in prevention costs, as in the costs of engaging a supplier that is certified according to industry standards Preference in competitive bidding by suppliers

Continuous Improvement Design Activities

Collaboration Technologies - Effective collaboration with supply chain partners requires that your organization share valuable information in real time. The most efficient way to do this is through the use of technology or electronic collaboration. Use of ERP systems, vendor managed inventory, and supplier scheduling. Voice of the Customer - Use the information to define the difference between what is value added versus waste. Determine new product features by working backwards. They start at the desired end-product and reverse engineer it back to determine the appropriate manufacturing environment. Supplier Feedback - Establish close supplier relationships. Evaluating a supplier for design capabilities and manufacturing process.

Theory of Constraints (TOC)

Complex systems exhibit inherent simplicity. Very small number of variables known as a constraint, that limit the ability to generate more. Resource-limited scheduling - The scheduling of activities so that predetermined resource availability pools are not exceeded. Bottleneck - A facility, function, department, or resource whose capacity is less than the demand placed upon it. Organizations use TOC scheduling to - Identify and schedule constraints carefully - Buffer constraints with inventory - Maximize utilization at bottlenecks or constrained resources - Maximize system throughput.

Work Area Design Activities - Automation

Computer-aided design (CAD): The use of computers in interactive engineering drawing and storage of designs. Computer-aided manufacturing (CAM): The use of computers to program, direct, and control production equipment in the fabrication of manufactured items. Computer integrated manufacturing (CIM): The integration of the total manufacturing organization through the use of computer systems and managerial philosophies that improve the organization's effectiveness; the application of a computer to bridge various computerized systems and connect them into a coherent, integrated whole. Manufacturing execution systems (MES): Programs and systems that participate in shop floor control, Enterprise resource planning (ERP): Framework for organizing, defining, and standardizing the business processes necessary to effectively plan and control an organization so the organization can use its internal knowledge to seek external advantage. . Benefits of automated manufacturing design tools include increased production productivity, increased efficiency, and improved product quality.

Collaboration and Visual Techniques - Mitigating Risk 2

Concurrent Engineering - Forming a multifunctional design team or cross-functional team of representatives from various departments to participate in concurrent design of product and process design. Early manufacturer involvement and early supplier involvement. Design for manufacturability: Simplification of parts, products, and processes to improve quality and reduce manufacturing costs. Design for manufacture and assembly (DFMA): A product development approach that involves the manufacturing function in the initial stages of product design to ensure ease of manufacturing and assembly. Design for maintainability (also called design for service) addresses another important issue: the simplification of parts and processes to improve the after-sale service of a product. Modular Design - The strategy of planning and designing products so that components or subassemblies can be used in current and future products or assembled to produce multiple configurations of a product. Feature Postponement - Units are built without a variety of the features and options. When a customer requests the product with specific features then the final assembly occurs.

Consensus Building

Consensus represents a resolution—a decision that satisfies all participants. All team members develop and agree to support a decision that is in the best interest of the group as a whole.

Drum-Buffer Rope Terms

Constraint - Any element that prevents a system from achieving a higher level of performance with respect to its goal Drum - The constraint is viewed as a drum, and nonconstraints are like soldiers in an army who march in unison to the drumbeat Drum schedule - The detailed production schedule for a resource that sets the pace for the entire system. Buffer - Buffers can be time or material and support throughput and/or due date performance. Rope - The rope is the information flow from the drum to the front of the line (material release), which chokes the release of materials to match the flow through the constraint. Buffer management - A process in which all expediting in a shop is driven by what is scheduled to be in the buffers (constraint, shipping, and assembly buffers) Control point - Strategic locations in the logical product structure for a product or family that simplify the planning, scheduling, and control functions.

Shojinka

Continually balancing the number of workers in a work center to meet demand with a minimum number of workers to improve flow.

Quality Tool - Control Charting

Control charting is used to visualize and measure variation in a process. To create control charts, a series of samples are tested and two charts are created from the data, an X-chart and an R-chart. The upper and lower control limits are calculated. X-chart - Sample Mean R-chart - Range between min and max Application - Control charts analyze performance to identify the need for root cause analysis of special cause variations (variations other than random variations that are expected in the process).

Control of Operational Plans and Schedule - Lean Based

Control objective - Overall production flow rate Control of material flow - Pull: flow production in response to customer requirements Operations sequencing - Not a concern; relatively quick flow-through to finished goods Order tracking - Not necessary; minimal WIP; quick flow-through; no need for tracking Monitoring and feedback - Less central; focuses on the overall results Preferred lot size - One or small WIP and safety stock - Small Product demand - Best with medium/high volume, low variety, and stable demand

Control of Operational Plans and Schedule - MRP Based

Control objective - Work center capacity utilization Control of material flow - Push: schedules, shop orders, batches, job sequencing rules Operations sequencing - Important; based on due date priorities at each work center Order tracking - Important; track production floor transactions by operation Monitoring and feedback - Critical; input/output control and work center load reports Preferred lot size - Large WIP and safety stock - Large Product demand - Low/medium volume, high variety with variable demand and lead times

Operations Control Principles

Control of operations manages the execution of production plans and schedules and quality plans. Feedback from production is a fundamental requirement of the control process. Standard costs: The target costs of an operation, process, or product including direct material, direct labor, and overhead charges. Quality control: The process of measuring quality conformance by comparing the actual with a standard for the characteristic and taking corrective actions on the difference. Cost center: The smallest segment of an organization, typically a department, for which costs are collected and formally reported. The criteria in defining cost centers are that the cost be significant and that the area of responsibility be clearly defined. Labor standard: Under normal conditions, the quantity of worker minutes necessary to finish a product or process.

Group Principles - Organizational comparision

Conventional Organization - Specialized job assignments, many and narrow job categories, supervisor schedules the work, training for tasks assigned the worker, job rotation infrequent, and personnel issues handled by supervisor Self-Directed Work team - Job enlargement for individuals, few and broad job categories, team schedules work, training for multiple tasks, routine job rotation, personnel issues handled by team

Coordination with Distribution Center and/or Processing Center Design

Coordinate equipment configuration with the distribution center and processing center design so they support the five performance objectives of quality, dependability, flexibility, speed and cost. Fixed-position layout - Used in project manufacturing processes such as the construction of large buildings. The product is stationary and built on site. Functional layout - Also called a process or job shop layout, organizes work centers by function. Variety of jobs is high while volume is low. Cellular layout - Consists of machines and workers arranged to handle a linear flow of products or product groupings that follow the same routing. Layout is referred to as a cell. Product-based layout - Equipment is arranged to facilitate the movement of the product through the manufacturing process to achieve the performance objective of speed. High volume/low variety

Controlling Operational Costs Terms

Cost control - Applying procedures that monitor the progress of operations against authorized budgets and taking action to achieve minimal costs. Cost accounting - The branch of accounting that is concerned with recording and reporting business operating costs. It includes the reporting of costs by departments, activities, and products. Cost variance - In cost accounting, the difference between what has been budgeted for an activity and what it actually costs. Actual costs - Labor, material, and associated overhead costs that are charged against a job as it moves through the production process. Used in ETO and MTO environments. Standard costs - Based on estimates by production and engineering of the quantity and cost of direct materials, direct labor, and overhead required to make a single unit of an item.

Five stages of corporate responsibility

Defensive Compliance Managerial Strategic Civil

Performance Objectives

Dependability—safety stock needed, processing costs, rescheduling frequency Flexibility—volume flexibility, mix flexibility, delivery flexibility and time, product and service flexibility Quality—error-free process, conformance quality of operations Speed—throughput times, queuing and inventory, processing costs Cost—profit margins, working capital requirements, transfer pricing, inventory turns

Designing a Distribution or Processing Center

Design a layout. Define process requirements and flowcharting the sequence of material handling, various processing steps and volumes. Refine the layout. Use of conventional to fully automated materials handling and production processes work together to produce and optimum layout. Simulate the process.Use computer simulation to test the system design, throughput volumes and functions/systems integration.

3 Categories of Operation Decisions

Design decisions: strategic decisions concerned with design of operations and processes Delivery decisions: strategic decisions concerned with planning and controlling delivery of products and services Development decisions: strategic decisions concerned with development of operations performance

Design Experiments to Measure Process Variables

Design of experiments (DOE) - 1) A process for structuring statistically valid studies in any science. 2) A quality management technique used to evaluate the effect of carefully planned and controlled changes to input process variables on the output variable. The objective is to improve production processes. Tools of experimentation - Blocking, Randomization, Repetition Taguchi methodology - A concept of off-line quality control methods conducted at the product and process design stages in the product development cycle.

Qualifying Product Design

Detailed product definition Production of samples Approval of test procedure Qualification testing Analysis of test results

Specification of Quality Requirements

Determine contracting approach. Define numerical requirements. Define the supplier quality system.

PAC Technique - Sequencing

Determining the order in which a manufacturing facility is to process a number of different jobs in order to achieve certain objectives. Use of priority rules - Due date, order slack, slack per operation, critical ratio, shortest operation next. Once priority rules are determined, use of dispatching to determine the order in which to apply the rules. Dispatching rules - First come first served, earliest job due date, earliest operation due date, shortest process time, critical ratio, slack time

Discrete vs Non-Discrete

Discrete items - Separable and distinct, such as automobile components, machine tools, and shoes. Non-discrete items - Inseparable and made in bulk quantities, such as chemicals, milk, gasoline, and steel—though they can be measured, cut, or packaged into saleable units.

Resource Constrained Schedule - Drum-Buffer-Rope

Drum - Pace of production Buffer - Since it is so important that the constraint never be starved for needed inventory, a time buffer is often established in front of the constraint. Rope - The analogy is that the rope pulls production to the constraint for necessary processing. While this may imply a kanban-type pull system, it can be done by a well-coordinated release of material into the system at the right time.

Enterprise Resources Planning (ERP)

ERP systems provide organizations with - Greater visibility of financial and operational performance - Adoption of better, integrated business processes - Improved control of operations - Better communication and information exchange with customers - Integration with supply chains of customers and suppliers. ERP allows the system to - Plan the schedules and routings of products through work centers. - Plan schedule releases for make-to-stock products made on high-volume assembly lines. - Recommend the release of authorizations such as work orders or schedules to begin operations at work centers. - Facilitate reporting at each stage of production to enable Appropriate in push production systems

Selection and Training

Elements of Selection and Training - Development of selection criteria - Testing - Just in time delivery - Line manager involvement - Application oriented - Use of graphical and presentation techniques - Communication of policy and direction - Job rotation

Employee Involvement and Empowerment

Employee involvement (EI): The concept of using the experience, creative energy, and intelligence of all employees by treating them with respect, keeping them informed, and including them and their ideas in decision-making processes appropriate to their areas of expertise. Employee involvement focuses on quality and productivity improvements. Employee empowerment: The practice of giving non-managerial employees the responsibility and the power to make decisions regarding their jobs or tasks.

Individual Principles - Adjusting

Employee's ability to regulate and control what is happening to prevent errors. Failure Mode and Effects Analysis (FMEA) - Method used to evaluate a design process to identify and rank potential failures. Rates the probability of failure, degree of severity, likelihood of escaping detection to calculate a risk priority number (RPN). Preventing failures - Design out fail points, build in redundant systems, use failsafe work methods, perform maintenance, mitigate risks Recovering from failures - Discover, Act, Learn, Plan

Individual Principles - Employee accountability

Employees must understand and be held accountable for job responsibilities and assigned quality tasks. Employees should anticipate receiving ongoing coaching, mentoring, and feedback on a variety of quality and continuous improvement tools and processes from their managers 3 Sources of measurement - Internal process, workers, inspectors Feedback needs to be useful and applied immediately Once the feedback is received, employees must be held accountable for taking action.

Job Enlargement and Enrichment

Enlargement - Expanding the number of tasks a worker performs in producing a product Enrichment - Having more control over how tasks are performed. Four types of job enlargement and enrichment Skill variety - Horizontal Autonomy - Vertical Task identity Task signfigence

Network design principles (Supplier relationships)

Ensure Dependability of Suppliers - Looking for high quality suppliers to ensure high quality products. Don't Hide Quality Problems with Excess Inventory - Excess use of buffers and safety stock due to supplier problems. Look for improvements with supplier to reduce the use of buffers. Establishing Collaborative Relationships - A collaborative relationship with suppliers will build better communication, stronger trust and encourage the sharing of common resources.

Managing Bottlenecks

Establish a buffer in front of bottleneck. Control the rate of material flowing into the bottleneck. Focus on maintaining or increasing bottleneck capacity Adjust loads. Change schedule.

Managing for Quality - Quality control

Executed by middle management Select the control subjects. Measure actual performance. Run a comparison of actual performance against the targets and goals. Act on the difference(s). Measure and maintain performance continuously.

Managing for Quality - Quality planning

Executed by senior leadership Determine goals. Customer identification Determine customer needs. Build features that meet customers' needs. Develop processes that enable production Determine process controls and transition the plans to the operational team.

Managing for Quality - Quality improvement

Executed by team leaders and employees Present and prove the need with a business case. Build a project infrastructure. Pinpoint the improvement projects. Select project teams. Ensure that the teams have the resources, training, and motivation to diagnose the cause and determine remedies. Determine the controls that will maintain the gains.

Establishing Customer and Supplier Relationships

Find and Respond to the Voice of the Customer - The voice of the customer is a way for gathering direct input from customers regarding their needs and experiences. Recognize Internal and External Customers - The external customer label also extends to any organization whose needs must be met in planning, making, and selling a product. Internal customers, as we mentioned earlier, have a choice of suppliers and need to be persuaded that internal suppliers can satisfy their needs. Identify the Customer Recognize That not All Customers Are Equal - About 80 percent of sales go to 20 percent of the customer base. Priority should be given to the vital few because of their contribution to profit.

Three Areas of MPC Framework

Front End - Master Planning of Resources (MPR) Engine - Detailed scheduling and planning (DSP) Back End - Execution and control of operations (ECO) MRP - Usage of job shop. Logical flow through front, engine, and back end. Lean - Main flow from front end to back end. Largest impact on the back end.

Scheduling Tool - Gantt Charts and Control Boards

Gantt or bar charts are a type of visual aid used for loading and scheduling. They are most often used in the project process type. Control board - Schedule, planning, dispatch board. A visual means of showing machine loading or project planning.

Middle Management

Gemba: A management approach in which managers observe the actual work being carried out in order to understand it better, coach, guide, and follow up on corrective actions with the line manager. Management by walking around (MBWA): The management technique of managers touring a facility on a regular basis to talk with workers and staff about problems, trends, and potential solutions.

DFE (Design for environment) Steps

Get "free of" known culprits. - Begin to turn away from substances that are widely recognized as harmful. Follow informed personal preferences. - Base design choices on the best information available Creating a "passive positive" list. - Here design becomes eco-effective Activate the P list. - Instead of being less bad, we figure out how to be good. Reinvent. - Transform the ideas into an eco-effective vision.

Design Principal Levels

Global - Design principals affecting the organization's relationship to the physical environment and society, including local communities, the workforce, and sustainability Network - Design principles guiding collaborative interactions with up and downstream suppliers and customers Local - Design principles shaping the internal activities of organizations

Local design process tools

ISO 9000 - A set of international standards on quality management and quality assurance developed to help companies effectively document the quality system elements to be implemented to maintain an efficient quality system. Failure mode effects analysis (FMEA) - A procedure in which each potential failure mode in every sub-item of an item is analyzed to determine its effect on other sub-items and on the required function of the item. It helps identify the most likely causes and helps design a more robust way to remedy the issue. Certificate of compliance - A supplier's certification that the supplies or services in question meet specified requirements.

Outputs from scheduling and control to MRP and CRP

Important feedback information flows from scheduling, control, and vendor scheduling back to MRP and CRP, including: - Status information that includes operation completions, quantity verifications, order closeout and disposition, and accounting data - Warning signals that include inadequacies in material and capacity plans that might affect achievement of MPSs.

Cross-Functional Training

Improving employee proficiency levels in roles outside their current responsibilities. Benefits Cost savings Replacement workers Employee motivation Challenges Proximity to use Focus on the wrong things Wrong method of delivery Over-complication

Pull system

In a pull system, production begins when demand or a pull signal occurs. Pull systems are used with lean systems. Execution in a pull environment - Mixed-model scheduling - Rate-based scheduling - Synchronization - Line balancing - Constrained resources

Gatekeeping

In group dynamics, a technique applied by a team leader to effectively manage a situation, discussion, or meeting. For example, in a situation where a dominant spokesperson or person of authority monopolizes a discussion, the gatekeeper will intervene by requesting additional group members' input.

Infinite and finite loading

Infinite loading - Jobs are assigned to work centers without regard for the capacity of the work center. Priority rules are appropriate for use under the infinite loading approach. Jobs are loaded at work centers according to the chosen priority rule. This is known as vertical loading. Finite loading - Projects the actual start and stop times of each job at each work center. Considers the capacity of each work center and compares the processing times so that process time does not exceed capacity. Horizontal loading

Market research

Inquiry—Focus groups and telephone and online surveys, to name a few Observation—Observation of the use of a product by customers in relevant conditions Market research provides background information on the gap between customer expectations and perceptions of a product. It also helps to determine if product loyalty is strong or weak.

Corporate Social Responsibilities

Inside-out linkages are the influences of an organization's value chain activities on society. Outside-in linkages are the influences of society on an organization's value chain activities.

Control Goals

Integrated performance measurement Balanced scorecard - Financial, customer, business process, continuous improvement Setting performance targets

Scheduling Tool - Job Shop and Block scheduling

Job shop scheduling - One of the production planning and control techniques used to sequence and prioritize production quantities across operations in a job shop. Block scheduling - An operation scheduling technique where each operation is allowed a "block" of time, such as a day or a week.

Operations Capability

Key Performance Measurement Reports at Work Center Day by the hour First Time Through WIP to Standard WIP Overall Equipment Effectiveness

Individual Principles - Job responsibilities

Knowledge of what they are supposed to do What to do - Product standard, process standard, definition of responsibility Poka-yoke - Mistake-proofing techniques, such as manufacturing or setup activity, designed in a way to prevent an error from resulting in a product defect. Possible errors - Skills based human error, rules-based human error, knowledge based human error, a slip, errors of intention, rules based error

Application of Lean Tools to Network Design

Lead time and time horizons - Lean will work to reduce time horizons and shorten the space between time fences by working with suppliers to deliver in shorter lead times. Dock-to-stock - A program through which specific quality and packaging requirements are met before the product is received. Prequalified product is shipped directly into the customer's inventory. Value stream mapping - A lean production tool to visually understand the flow of materials from supplier to customer that includes the current process and flow as well as the value-added and non-value-added time of all the process steps. Lean Six Sigma - Lean six sigma focuses on both problem solving and process improvement. A methodology that combines the improvement concepts of lean and six sigma. It uses the seven wastes of lean and the DMAIC process from six sigma.

Manufacturing Planning and Control Levels

MPR - Tactical planning DSP - Operations level ECO - Operations level

Types of Scheduling

MRP-based - Used to schedule operations in work center batch processes and in flow processes when production is scheduled in batches Theory of constraints - Used to ensure maximum throughput by attacking bottlenecks or constraints Lean - Used when production is a flow and is paced to the rate of customer demand

MRP-Based Scheduling

MRP-based scheduling is a component of production activity control. It is used in both intermittent and flow manufacturing process types. In intermittent manufacturing, MRP uses work orders to "push" work sequentially through work center operations. In flow manufacturing, where the "flow" is in batches, MRP schedules the work center operations sequentially. MRP-based schedules are based on a forecast in make-to-stock environments or are developed after an order is received in make-to-order environments

Executing the MRP Schedule - Activities to prevent adjustments to resources

Manufacturing lead time. Time fence policies Time standard - The predetermined times allowed for the performance of a specific job. Final assembly scheduling (FAS) Maintenance on equipment - Preventive, predictive, remedial

Total Productive Maintenance (TPM) - Overall equipment effectiveness (OEE)

Measuring the effectiveness of all of the equipment of a company based on usage, performance, and production quality. 3 components Availability loss—All events that stop planned production for a measurable length of time; calculated as actual run time divided by planned run time. Performance loss—The factors that cause production to operate at less than full speed when running; calculated as actual quantity produced divided by target quantity produced. Quality loss—The manufactured pieces that do not meet the organization's quality standards, including those that require a repair or rework order; calculated as the quantity produced right the first time divided by the total quantity produced. OEE = Availability * Performance * Quality expressed as a percentage

Local Design Principals

Meet customer lead time expectations. Meet product design and quality requirements. Meet product variety and flexibility requirements. Meet quantity and capacity requirements. Consider buying rather than making components.

Elimination of Non-Value-Added Activities

Muda: In lean manufacturing, costs are reduced by reducing waste within a system. Muri: A Japanese word meaning strain or overburden. Mura: A Japanese word meaning unevenness or variability.

Meeting Skills

Notice of the meeting - Send out a notice of the meeting well in advance to allow everyone to attend. Reminders - The day before the meeting, send a reminder of the meeting, date, time, and location Agenda - The agenda should allow plenty of time to address each topic as well as indicate the party responsible for leading that portion of the meeting. Meeting summary - Prepare a meeting summary to be forwarded to all participants and other stakeholders.

Supplier Selection Criteria

Outsourcing advantages - Specialized knowledge and quality, focus resources on core competencies, lead time reduction, greater capacity and ability to change production levels, economies of scales, lower capital and personnel costs. Outsourcing disadvantages - Possible reduction in quality, loss of operational control, impact on synchronization of schedules, impact on communication of schedules, possible excess internal capacity Multiple sourcing - Better prices and quality, less vulnerable to supply disruptions, higher transaction costs, suppliers not as committed, fewer economies of scale, more effort to communicate Single sourcing - Ease of communication, more cooperation, shared costs, individual supplier more affected by volume fluctuations, buyer vulnerable to supply disruption

Quality Tool - Pareto Charting and Analysis

Pareto Law - A small percentage of a group accounts for the largest fraction of its impact or value. This tool applies the Pareto principle in the form of a bar graph. Categories of data are ranked, usually from left to right along the x axis, from most significant to least. Application - Pareto charting/analysis distinguishes between the "vital few" categories that contribute most of the issues and the "trivial many" categories of infrequent occurrence

Performance Appraisals and Rewards

Performance appraisal: Supervisory or peer analysis of work performance. May be made in connection with wage and salary review, promotion, transfer, or employee training. Useful in measuring the following: - Ideas - Teamwork - Flexiblity - Quantity - Quality Performance measure: In a performance measurement system, the actual value measured for the criterion.

Network design logistics practices

Physical proximity. Supplier location affects landed cost, or the price plus the cost of transportation to the plant. It also affects lead times. Suppliers might maintain inventory at or near the plant to shorten lead times. Proximity also facilitates face-to-face communication, inspection and monitoring of product quality, and the exchange of tacit knowledge. Transportation modes. There are many transportation modes to select from including air, road, water, rail, and pipeline. It is important to use the appropriate mode of transportation based on the needs of the product, associated costs, and the ability to make on-time delivery to the customer. Tracking capabilities. Supplier and manufacturers should provide tracking capabilities to customers. This information needs to be accurate, and be available on demand.

Shewhart/Deming (PDCA) Cycle

Plan-do-check-action (PDCA) - A four-step process for quality improvement. In the first step (plan), a plan to effect improvement is developed. In the second step (do), the plan is carried out, preferably on a small scale. In the third step (check), the effects of the plan are observed. In the last step (action), the results are studied to determine what was learned and what can be predicted.

Input/Output Control

Planned input - Order quantities in one or more job or work orders expected to arrive at a work center in a planning period are determined initially by capacity requirements planning prior to order releases for the end items. Actual input - This is the actual arrival of jobs (per shop floor execution system) at the work center in the planning period, converted into standard hours as for planned inputs. Planned output - This represents the standard hours of work based on labor hours expected at the work center in the planning period, adjusted for efficiency. Actual output - This shows the exact quantities produced converted to standard hours using routing file data on run time per unit and setup time for the run. Count point - A point in a flow of material or sequence of operations at which parts, subassemblies, or assemblies are counted as being complete

Decoupling point

Point in the process (for example, supply chain) at which customer demand meets supplier inventory. The goal is to match or manage the decoupling point to achieve the most advantageous order fulfillment strategy.

Quality Systems

Poka-yoke - Design the process to not let the error happen QS 9000 - A variation of ISO 9000 certification with additional requirements tailored for the automobile industry, including suppliers. Process control - 1) The function of maintaining a process within a given range of capability by feedback, correction, and so forth. 2) The monitoring of instrumentation attached to equipment Flexible automation - Automation that provides short setup times and the ability to switch quickly from one product to another.

Process Capability Analysis

Process capability - The ability of the process to produce parts that conform to (engineering) specifications. Process capability relates to the inherent variability of a process that is in a state of statistical control. Process capability analysis compares the variation in product characteristics to the allowable variation determined from engineering tolerances.

Measuring process capability

Process capability index - The value of the tolerance specified for the characteristic divided by the process capability. There are several types of process capability indices, including the widely used Cpk and Cp. USL = uppers spec limit LSL = lower spec limit SD = standard deviation Cp = USL - LSL/(6*SD) CpK = Lesser of (USL-Mean)/(3*SD) or (Mean - LSL)/(3*SD) CpK less than 1 - process unacceptable CpK 1 to 1.33 - process is marginal Cpk greater than 1.33 - process is acceptable

Job Design

Process design must consider the capabilities of workers. In MTO environments, skilled and flexible workers are needed for the low-volume, high-variety product manufacturing required in job shops. In repetitive and mass/continuous production, worker skills are secondary to investment in machinery and mechanized processes.

Engineer to Order (ETO)

Products whose customer specifications require unique engineering design, significant customization, or new purchased materials. Each customer order results in a unique set of part numbers, bills of material, and routings. Low Volume/High Variety Fixed Position process layout Project process type

Quality Tool - Flowcharts

Process flow - The sequence of activities that, when followed, results in a product or service deliverable Flowchart -The output of a flowcharting process; a chart that shows the operations, transportation, storages, delays, inspections, and so on related to a process. Flowcharts are drawn to better understand processes. Application - Process maps, or flowcharts, depict complex processes, identifying interdependencies that can cause potential bottlenecks or opportunities for efficiency

Flow vs Intermittent Manufacturing Comparison

Process type Intermittent—Goods are produced based on customer orders and not for stocking. Flow—Goods are produced based on demand forecast and for stocking. Layout Intermittent—The layout is based on the function being performed irrespective of the product being produced. Flow—The layout is based on the product. Routing Intermittent—Production routing is flexible. The product design goes on changing. Flow—Production routing is not flexible; it is standardized. The same product is manufactured continuously. Scheduling Intermittent—Based on the production rate for a given period of time. Flow—Based on the sequence in which tasks are to be completed. Transaction requirements Intermittent—Cost per unit may be higher because production is done on a small scale. Flow—Cost per unit may be lower because production is done on a large scale.

Product Costing

Product cost - Cost allocated by some method to the products being produced. Throughput costing - Direct materials, direct labor Variable costing - Throughput costing + factory overhead Full absorption costing - Variable costing + Non-factory costs (sales, admin) Life-cycle costing - Full absorption costing + R&D, design, customer service Profit = Price (Fixed) - Cost

Quality Planning Cycle

Product definition - Quality begins by determining the market for the product, its performance level, the tangible and intangible characteristics that customers will find to be of value, the price point, and an estimate of sales volume. Product design - Design quality includes creating product specifications and performance requirements, materials, dimensions, and tolerances. Product manufacturing - Quality during manufacturing requires the manufacturer's capability to make products to the specifications of the product design. Product consumption - Customer satisfaction through value to the customer is the ultimate objective of quality management and is a validation of the first three stages of the cycle. Meet customer requirements of performance, features, conformance, and warranty.

Models that help adapt production processes to changes in market conditions

Product/service life cycle - Illustrates how long a product or service is marketable. The common stages a product/service may go through in its life are introduction, growth, maturity and decline or innovation. Order winner - Competitive characteristics that cause a firm's customers to choose that firm's goods and services over those of its competitors. Product profiling - Examine the degree of alignment between the needs of a company's markets and the characteristics of its existing manufacturing process and infrastructure investments. Product-process matrix - Used to demonstrate the combination of a product's volume and variety characteristics, and the nature of the processes that make it.

PQCDSM

Productivity Quality Cost Delivery time Safety and the environment Morale (of workers).

Process and Layout choices focus

Project (Fixed functional), Work Center (Functional cellular), Batch (Functional cellular) - Very high dependability and flexibility importance Line (Cellular product based), Continuous (product based) - Very high speed and cost importance

Lean Based Scheduling

Pull Based system Flow layout, standard routing through cellular layout Short lead times Low WIP Work centers have surge capacity; utilization flexes based on production rate necessary to meet customer orders Work completed quickly; jobs easily tracked visually

MRP Based Scheduling

Push Based system Process layout, complex routings Long lead times High WIP High work center utilization = goal Detailed scheduling routes work through work centers

Types of Quality Teams

Quality improvement project team Workforce team Quality business process team Self-directed team Kaizen circle - Highly structured Quality circle

Executing the MRP Schedule - Adjustments to resources

Rush/expedited orders - An order that must be completed in less than the normal lead time Resolving imbalances - Managing and resolving imbalances is about managing the capacity available at each workstation or operation. Schedule composition - The MRP schedule disaggregates the timing and need for components based on the end-product demand Resource constraints - Resources are not necessarily a constraint but will become a constraint unless they are scheduled carefully. (Capacity constrained resources)

Scheduling

Scheduling is a key factor in manufacturing productivity. The objective of scheduling is to make the best use of manufacturing resources to meet delivery dates. Scheduling goals include capacity utilization, manufacturing lead time minimization, and meeting customer service goals (e.g., due dates).

Managing the TOC Schedule

Scheduling the drum Exploiting the drum Material release, or rope Proactive management of buffers Elevating the drum

Work Area Design Activities - Simulation and Modeling

Simulation and modeling are considered useful tools in order to study and optimize production processes. Simulation: The technique of using representative or artificial data to reproduce in a model various conditions that are likely to occur in the actual performance of a system. Model: A representation of a process or system that attempts to relate the most important variables in the system in such a way that analysis of the model leads to insights into the system.

DMAIC Control Technique

Six sigma: A methodology that furnishes tools for the improvement of business processes. The intent is to decrease process variation and improve product quality. Define-measure-analyze-improve-control (DMAIC): A six sigma process that outlines the steps needed to create a completely new business process or product at six sigma quality levels. Define - Identify potential projections, evaluate, and select projects, prepare problem and mission statement. Measure - Document current process, measure process variation, formulate hypotheses, plan for data collection Analyze - Collect and analyze data, test hypotheses, diagnose and present proven root causes and alternative remedies to be tested. Improve - Evaluate alternative remedies, design and test remedies, deal with resistance to change, transfer remedy to operations Control - Design controls and document improved process, validate measurement system, determine final process capability, implement and monitor process controls.

Functional performance objectives

Speed (Responsiveness) Dependability (Asset management efficiency) Flexibility (Agility) Quality (Reliability) Cost (Cost)

Determining Variation and Conformance

Statistical process control (SPC) - The application of statistical techniques to monitor and adjust an operation. Conformance - An affirmative indication or judgment that a product or service has met the requirements of a relevant specification, contract, or regulation. Variance - 1) The difference between the expected (budgeted or planned) value and the actual. 2) In statistics, a measurement of dispersion of data. Common-cause (random cause): Causes of variation that are inherent in a process over time. They affect every outcome of the process and everyone working in the process. Special cause (assignable cause): A source of variation in a process that can be isolated, especially when its significantly larger magnitude or different origin readily distinguishes it from random causes of variation.

TOC Scheduling Steps

Step 1: Create a network diagram. This is accomplished by combining the data in the bill-of-material file with the routing file to form a network (or extended tree) diagram for the order being scheduled. Step 2: Form a product network. This is done by combining the network diagram data with the MPS due date and linking the customer orders to the final operation, which in turn links to previous operations and back to raw materials. Step 3: Assess capacity utilization by work center. Next the product network and resource descriptions are fed into a series of routines that identify bottlenecks. The assessment is carried out by identifying bottleneck centers and the expected load for each resource. Rough-cut capacity planning may be used to accomplish this. Step 4: Schedule work center. At this point, the resources are split between bottleneck and nonbottleneck resources. Step 5a: Schedule bottleneck resources. In this step, bottleneck resources and all succeeding operations are scheduled. Quality and efficiency improvements should be targeted here. This portion of the network is forward-finite-loaded. Step 5b: Schedule nonbottleneck resources. Scheduling the bottleneck resources first is an indication that the split between bottleneck and nonbottleneck scheduling highlights where attention needs to be focused first. This portion of the network is not forward-finite-loaded.

Scheduling Interface - MRP/CRP to the scheduling of PAC

Step 1: MRP passes scheduling updates and authorization to release planned orders to PAC. Step 2: PAC converts planned orders into detailed work center operations schedules and load profiles. Step 3: PAC requests that CRP validate capacity availability to meet the planned load. Step 4: CRP validates the load profile, if it has not done so previously. Step 5: PAC adjusts capacity or the schedule if CRP deems it is necessary. Step 6: PAC informs MRP, as necessary. Step 7: PAC releases the work orders to the work centers. Job shop batch production

Scheduling Interface - PAC to MRP

Step 1: Release (dispatch) orders to work center of production. Step 2: Gather data on performance of work orders compared to planned schedules. Step 3: Feedback to MRP. Step 4: Gather WIP, lead time, and queue data. Step 5: Feedback to MRP. Step 6: Gather work center efficiency, operation times, order quantities, and scrap data. Step 7: Feedback to MRP.

Planning Levels (Strategic, Tactical, Detailed planning and control)

Strategic - Major process decisions, done quarterly/yearly, high risk Tactical - Workforce, inventory, logistic decisions. Planning numbers aggregated monthly. Moderate risk Detailed planning and control - Limited ability to adjust capacity. Detailed planning (day to day). Lowest risk

Strategic Plan vs Operational Plan

Strategic - Sets a direction for the organization, devising goals and objectives and identifying a range of strategies so the organization can achieve its goals. The strategic plan does not dictate the day-to-day tasks and activities involved in the running of the organization. Operational - Highly detailed information specifically to direct people to perform these day-to-day tasks. Organization management and employees should regularly reference the operational plan in carrying out their everyday work. Focus on What, Who, When, How much. Facilitates the coordination of the organization's resources (human, financial, physical) so that goals and objectives in the strategic plan can be achieved.

Benefits of quality management

Strengthened competitive position Elimination of defects and waste Higher productivity Adaptability to change Improved customer focus and satisfaction Improved employee morale Improved and innovative processes.

Effects of Lean Scheduling

Sufficient volume in a repetitive process - The best-known examples of lean systems include organizations with high-volume product flow in repetitive production environments. However, it is important to remember that lean can be applied in any environment. Production rate goals - The focus is on the rate of production, not on manufacturing batch processes. Reduction in work-in-process - Production should be as close as possible to the rate of customer demand. Level production schedules - Create certainty and stability of operations, standardize work, simplify materials and capacity planning, and reduce inventory costs. Heijunka (or mixed-model) scheduling/production - Making several different parts or products in varying lot sizes so that a factory produces close to the same mix of products that will be sold that day.

Green and Sustainable Manufacturing

Sustainability: An organizational focus on activities that provide present benefit without compromising the needs of future generations. Green manufacturing: A method of producing a good or service that minimizes external cost and pollution. It includes design for reuse, design for disassembly, and design for remanufacture. Triple bottom line: An approach that measures the economic, social, and environmental impact of an organization's activities with the intent of creating value for both its shareholders and society.

Total Productive Maintenance (TPM)

TPM is an approach to equipment maintenance that strives for perfect production with none of the following. Slow running or small stops Breakdowns Defects Accidents Missed shipments.

Lean-Based Production Activity Control - Takt Time

Takt time is the result of converting the rate of customer demand to a per-unit production rate based on heijunka schedules for standard products or models Takt time = Available production time/Rate of Customer demand Cycle time - The time between the completion of two discrete units in production Pacemaker - In lean, the resource that is scheduled based on the customer demand rate for that specific value stream; this resource performs an operation or process that governs the flow of materials along the value stream.

Partnership-based Quality Planning Techniques

Teams Multiple channels Value engineering Total cost of ownership Other quality -related planning activities Co-location

Constraint and bottleneck management

Technique used to ensure that demand on a resource, facility, function, or department does not create a bottleneck that slows down the planned throughput of the entire system. Steps for constraint management 1.) Identify—Identify the CCR before it becomes a bottleneck. 2.) Exploit—Keep the CCR working 3.) Subordinate—Feed into the process only what can be handled at the CCR. 4.) Elevate—Accelerate and improve the CCR. 5.) Repeat—After fixing the CCR, return to step 1 to attack the new CCR.

Lean Scheduling

Techniques are used to improve the flow or smoothness of work, thereby eliminating any mura. Using control limits. If demand stays within the plan, the plan should not be changed. Not overreacting to changes in demand. Use takt time to manage and control time. Prioritizing regular orders. Don't let large or unusual orders derail regular orders. Using available-to-promise logic in master scheduling software. Moving to "milk run" deliveries. In this technique, several small batches are delivered on a single vehicle more frequently versus a few large deliveries less frequently. The number of loads stays the same.

Appropriate Technology and Equipment

Technology and equipment choices need to fit the choice of production process. Flexible machines (and workers) are needed to meet the product variety requirements of work center processes. Heavy capital investment is required for dedicated and often highly specialized equipment used in line production (assembly line) and mass/continuous production processes.

Statistical quality control (SQC)

The application of statistical techniques to control quality. Includes acceptance sampling as well as statistical process control, but is often used interchangeably with statistical process control. SQC is the application of the statistical analysis tools to monitor process outputs (dependent variables). SPC is the application of the same analysis tools to control process inputs (independent variables). Statistical quality control is a broader concept that encompasses both acceptance sampling and statistical process control. Acceptance Sampling - The process of sampling a portion of goods for inspection rather than examining the entire lot. Attribute sampling. The presence or absence of a characteristic is noted in each of the units inspected. No measurements are needed. Variable sampling. The numerical magnitude of a characteristic is measured and recorded for each inspected unit.

Worker Self-Control

The concept of worker self-control ties into the fact that employees who are engaged and involved in the process are more likely to support the change. Individuals have full mastery over the attainment of planned results and can be held responsible for the results. Workers have knowledge of what to accomplish, performance over goals, means of regulating performance. In an environment that tasks are adequately planned, work is standardized, process variation is under control, workers have access to tools to maintain self control. Jidoka - The practice of stopping the production line when a defect occurs.

Production Activity Control (PAC)

The function of routing and dispatching the work to be accomplished through the production facility and of performing supplier control. PAC encompasses the principles, approaches, and techniques needed to schedule, control, measure, and evaluate the effectiveness of production operations. The activities of the PAC system can be classified into planning, execution, and control functions.

Overlapping

The next operation begins before the entire lot or process batch is completed. Used to shorten lead time. Potential downsides - Costs of having more than one move or transfer batch Disruption of the work center schedule by expediting operations Lengthening of queue and lead time for other orders

Elements of Schedule

The operations necessary to complete an item The sequence and routing of the operations The start and finish dates of each operation Time estimates for each operation The work centers where the operations are performed.

Priority control

The process of communicating start and completion dates to manufacturing departments in order to execute a plan. The dispatch list is the tool normally used to provide these dates and priorities based on the current plan and status of all open orders. Communication tool for priority control is the dispatch list. Contains total available load, start and finish dates, total future load in standard hours

Total quality control (TQC),

The process of creating and producing the total composite good and service characteristics (by marketing, engineering, manufacturing, purchasing, etc.) through which the good and service will meet the expectations of customers.

Process Type - Project

The project process type is usually associated with ETO manufacturing environments and typically involves highly customized, discrete products of wide variety made one at a time. Resources generally are dedicated to individual tasks. The process involves many unique process tasks and highly intermittent flow of materials. Ex - Ships, house construction, motion picture production

Operations Sequence

The sequential steps for an item to follow in its flow through the plant. This information is normally maintained in the routing file.

Drum-Buffer Rope

The theory of constraints method for scheduling and managing operations that have an internal constraint or capacity-constrained resource. The goal of this approach is to move material through work centers at the pace of the bottleneck and to keep the bottleneck work center supplied with WIP at all times to maximize throughput.

Manufacturing Lead Time

The total time required to manufacture an item, exclusive of lower-level purchasing lead time. 5 Elements Queue time - The amount of time a job waits at a work center before setup or work is performed on the job. Setup time - The time required for a specific machine, resource, work center, process, or line to convert from the production of the last good piece of item A to the first good piece of item B. Run time - The time required to process a piece or lot at a specific operation. Run time does not include setup time. Wait time - The time a job remains at a work center after an operation is completed until it is moved to the next operation. It is often expressed as a part of move time. Move time - The time that a job spends in transit from one operation to another in the plant. For our purposes, this includes wait time.

Process Type - Work Center

The work center process type, also called job shop or intermittent, is associated with MTO manufacturing environments. Resources (equipment, labor) are shared among tasks but achieve different results for different discrete products. Work centers are organized around similar processes rather than around product flow.

Evaluating Throughput

Throughput - The rate at which the system generates "goal units." Because throughput is a rate, it is always expressed for a given time period—such as per month, week, day, or even minute.

Calculation of capacity required

Time per work order = Setup time + run time Run time = Quantity * Standard time per unit

Work Area Design Activities - Work Orientations, Their Flows, and Layouts

Tools and equipment layout - Economy of motion in obtaining, using, and returning tools, Visibility of tools to facilitate finding and selection, Ergonomics of using, lifting, and moving of tools and materials Worker efficiency - Minimizing wasted effort in tool use by locating tools in well-marked and accessible locations, Accounting for the ergonomic impact of lifting and moving materials and equipment and the needs of workers of different physical traits Workplace Layouts Islands - Workers in each island (process) produce at their own pace and usually as fast as they can. Connected Islands - Islands (processes) are connected by conveyers but there is no control over the rate of flow. Workers still build at their own pace. Connected islands with full work control. Islands are connected by conveyers. There is visual control over the rate of flow between processes: Cells. Machines are next to each other. One piece is made at a time and moved when completed to the next machine.

Decision Making

Tools in decision making Decision matrix - A matrix used by teams to evaluate problems or possible solutions. 2 × 2 matrix - The 2 × 2 matrix is a useful tool for categorizing things that can be reduced to two simple variables that matter to the organization, such as profitability and time. The axes of the 2 × 2 matrix represent competing forces in a situation Pareto analysis - This is a simple technique that teams can use for prioritizing changes by identifying the problems that will be resolved by making these changes. By using this approach, teams can prioritize the individual decisions that will most improve the situation.

Seven Basic Quality Tools

Tools that help organizations understand their processes in order to improve them. The tools are the cause-and-effect diagram (also known as the fishbone diagram or the Ishikawa diagram), check sheet, flowchart, histogram, Pareto chart, control chart, and scatter diagram.

Intermittent manufacturing process - 3 critical points

Transfer batch - The quantity of an item moved between sequential work centers during production. Goal is to reduce lead time of the overall order. Lot Sizing - A quantity produced together and sharing the same production costs and specifications. Planned Order Release = Planned Order Release/1 - Scrap Factor Reorder Point - A set inventory level where, if the total stock on hand plus on order falls to or below that point, action is taken to replenish the stock. The order point is normally calculated as forecasted usage during the replenishment lead time plus safety stock.

Lean-Based Production Activity Control - Heijunka

Use of production leveling to shorten manufacturing lead times, lower WIP and finished inventory, avoidance of peaks and valleys, basis for level and standardized work. Standardized work - A work process that is always carried out exactly the same way, preferably using the current best known way under which the output can be achieved. Kaizen - Continuous improvement

Lean-Based Production Activity Control - Kanban System

Use signals and standard containers to move parts quickly through production with the objective of minimizing inventory. Kanban systems are simple but powerful. They exercise control by: - Authorizing production at processes upstream from the pacemaker process - Pulling parts through upstream processes to the pacemaker based on the production schedule - Establishing the number of parts containers between processes on the shop floor - Using visual controls in a fast throughput environment.

Scheduling Tool - Forward and Backward Scheduling

Used to calculate production start and completion dates Forward scheduling - Material procurement and operations scheduling start when order is received - Operations usually scheduled from first to last - More inventory build-up than backward scheduling - If I start now, when can I have it? - Used when resources are under-loaded or capacity-related costs are high and load leveling is desired. Backward scheduling - Uses MRP logic: works back from MRP due date to determine operation start dates. - Last operation scheduled first; previous operations scheduled back from the start of the last. - Less inventory build-up than forward scheduling. - When must this be started in order to finish by [date]? - Used when low inventory is a top priority and production is synchronized with order due date.

The 5 S's

Used to create a workplace suitable for lean production. The goal is to reduce waste, reduce variation, and improve productivity. Sort - Sort out what you don't need Simplify - Organize the remaining items Scrub - Clean and inspect the work area Standardize - Create standards for performing sort, simply, scrub Sustain - Ensure that standards are regularly applied

Scheduling Tool - Vertical and Horizontal Loading

Vertical loading - Priority is given to scheduling and finishing whole jobs in order of job priority. Horizontal loading - Direct contrast to the practice of fully utilizing the capacity of each work center at all times. In horizontal loading, a work center might not give the priority to the most important job orders. They may be de-expedited.

Collaboration and Visual Techniques - Visual Management Techniques

Visual workplace Visual management triangle - seeing as a group, knowing as a group, acting as a group Clean workplace Visual system - Visual devices that share information, give instructions, or limit actions. Visual communication - Problem solving A3 report Visual workplace reporting

Forms of Waste

Waste of overproduction Waste of waiting Waste of transportation Waste of stocks Waste of motion Waste of making defects Waste of processing itself Waste of people skills

Shingo's seven wastes

Waste of overproduction, waste of waiting, waste of transportation, waste of stocks, waste of motion, waste of making defects, and waste of the processing itself.

Schedule Inputs

What to make When to make it Where to make it How to make it How much to make Time needed to make it Material availability Due date Machine maintenance schedules/failure rates Expected rework and scrap percentages Other demands on the facility

Process Type - Continuous Production

When products flow continuously from one part of the process to another and are not discrete. Ex - Water, gas, chemicals, steel

Work Area Design Activities

Work area design and workplace organization combine several manufacturing and assembly areas organizationally together, linked by some sort of storage, transportation, and handling system. Setting Specifications - The idea behind manufacturing specifications is to define the measurement values which correspond to conforming items. That is, when the measurement falls within the manufacturing specification then the product can either move to the next step in the process or if complete, shipped to the customer. Standardized Work - Standardized work is critical to lean manufacturing. By "standardized work," we mean work that adheres to several core standards. -Takt time for the manufacturing of products based on the rate of customer demand -Work sequence of the process designed for particular products -WIP, or how much inventory there should be for particular products

Lean Elements within Manufacturing

Work cells Kanban Quick changeover Job rotation Standard work 5S - Create a workplace suitable for lean production: sort, simplify, scrub, standardize, and sustain.

Lot splitting

Work order is split into two lots and runs concurrently on two machines. Not practical when the setup time is high relative to the run time. A suitable work center is not available.