Post Graduate Session 2 Operations

Copyright © Goldratt Schools, 2004

Operations


Any process of on-going improvement must answer the three questions:

What to Change?

What to Change to?

How to cause the Change?

What is the constraint?

What is the solution?

The Process of On-Going Improvement


Typical Problems in Managing Production

• Inventory is too high

• Production lead times are too long

• Not all customers orders are shipped on time

• Original plans have a very limited life

• There are a lot of course corrections (expediting)

• Not able to support stock holding agreements

These problems in TOC terminology are known as Undesirable Effects or “UDEs”


• Customers that never change their mind about their requirements

• Resources available

• Our resources excellently trained and disciplined (do what they are supposed to do when we tell them)

• Zero absenteeism

• Third parties deliver exactly what we asked for, on time

• Processes that are extremely reliable

and...

If Instead of Problems We Had...


• Equipment and technology systems that never breakdown

• Superb quality - no re-work

• All the data readily available and accurate

AND IF WE CAN DECIDE WHATEVER OPERATIONAL POLICIES WE WANT

then managing a shared resource environment would be very, very simple!

Right? Let’s see...

If Instead of Problems We Had...


Week: 1Day: 1

Time: 00:00

Cash:3000

Fixed Exp:11000

Pace: 1

FREEZE

setup

15

120

60

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30

0 -idle

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150

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140

2010

7

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180

825

150

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A B C D E F G H

RM

1

2

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Demand

A D F850


Week: 1Day: 1

Time: 00:00

Cash:3000

Fixed Exp:11000

Pace: 1

FREEZE

setup

15

120

60

0

30

0 -idle

-idle

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A B C D E F G H

RM

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Demand $180

$30

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0 0

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$65

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$180

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$240

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00

10

15

00

A D F850 INFO


All external problems were eliminated from the Paradise System

• Have you delivered all sites on time?

• Have you achieved the target of $4000 Net Profit?

Was It Easy To Manage?


Why is There No Solution?

D

A

D’

B

C

The TOC Conflict DiagramStrategic Tactical / Drivers Operational

The Objective – What we are

striving to achieve over all

The Necessary Conditions – Mandatory deliverables that must be achieved in order for A to

occur

Operational Activities – Decisions, behaviours,

policies, that are mandatory in order to

secure the deliverables


Don’t increase resources

Achieve a $4000 Net Profit

Increase Resource

Control (limit) costs

What do I want?What is the Driver?

What is likely to be the reaction of my

company?

What business need drives this reaction?

Why is There No Solution?

Meet promises to our customers

What are we trying to achieve?


We are not meeting the

delivery promises to clients

We are not achieving our target

($4000 NP)

We are missing sales revenue

Our on time performance

measure is poor

What is the cause of the effects?

We’re late in getting the work started and processed

Because...


Execute the plan

Reality strikes!

What is the cause of the effects?


Plan

We are having to improvise

Our plans quickly become invalid

Because...


So, What is the Core Problem?

PlanExecute the plan

Reality strikes!

Our plans quickly become invalid

We are having to improvise


The way we manage:

Plan & Execute


Is there a better way to plan how the system will work and control the execution of the plan?

Let’s check the TOC process:

Constraint - defined as anything that prevents a system from achieving a higher level of performance in relation to its goal/objective

Is there a better way?


1. IDENTIFY the system’s constraint(s)

2. Decide how to EXPLOIT (make the most out of) the constraint(s)

3. SUBORDINATE everything to the above decisions

4. ELEVATE - Find/invest in additional capacity or alternatives

5. If at any time in a previous step a constraint has been broken go back to Step 1.

Do not allow INERTIA to become the constraint!

The Five Focusing Steps


• Restart plant

• Let’s check the resource load analysis for the system

• Press Schedule in the tool bar and select Analyse

• Click Analyze and accept the current mix

• Look at the loading on your resources

Look again at your “Paradise System”...



In the Paradise System what are the system’s constraints?

1.

2.

1. Identify the system’s constraint(s)


Week: 1Day: 1

Time: 00:00

Cash:3000

Fixed Exp:11000

Pace: 1

FREEZE

setup

15

120

60

0

30

0 -idle

-idle

-idle

-idle

-idle

-idle

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-idle

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12

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140

2010

7

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180

825

150

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A B C D E F G H

RM

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Demand

A D FINFO850


2. Decide how to EXPLOIT the constraint

First Decision - Detailed task schedule for the Capacity Constrained Blue resource

Task Quantity

1.

2.

3.

4.

5.

6.


Second Decision - Delivery Schedule to ensure 100% on time for Product “A”

Quantity Day

1.

2.

3.

2. Decide how to EXPLOIT the constraint


• Step 1 - IDENTIFY -

• Blue - Capacity Constrained Resource

• Demand for products - relates to Product A type

• Step 2 - EXPLOIT

• Blue resource task schedule - DRUM

• Delivery schedule Product A - DRUM

Run #2 - Summary of Preparation


2. Decide how to EXPLOIT - Summary

Blue M/C DRUM Example 1 Task Quantity Comments

1. F5 40 Need to release RM F 30 units

2. E5 40 Need to release RM E 25 units

3. C5 40 Release RM A 40 & C 40

Task Quantity When Comments

1. A5 25 Day 1 Use WIP of B3

2. A5 15 Day2 Need to release A15 & C15 – day 2

Product “A” DRUM – Operation A5


• Review responsibilities within your team - Blue resource, Product “A”, purchasing etc.

• Press ‘Enter’ and run the system according to your decisions and schedules.

The “Paradise System” - Run # 2


Simulator Results - Run # 2FINANCIAL STATEMENT UTILISATION OF RESOURCES

Net Profit: % of: Break Prod Set-up

Cash at end of week: Blue ----

Return On Investment: Green ----

Throughput: Cyan ----

(Sales) Red ---- ---- ----

Inventory - RM value: Magenta

Inventory - $ days: Brown

Operating Expenses: 11,000

ORDER FULFILMENT

Product Quantity Committed Quantity Delivered On time - %

A 40

D 52

F 40

TOTAL


Net Profit: from ______ to ______

On Time %: from: ______ to ______

Have you achieved the target of $4000 Net Profit?

Was it easier?

What is still the problem?

Simulator Results - Run # 2

Have you improved the performance of the system?


• We must SUBORDINATE the release of work into the system to support our schedule for Blue and our delivery schedule for Product A

What is the meaning of SUBORDINATE ?

3. SUBORDINATE everything to the above decision(s)


A40

D50

F40

B325

E515

A65

C65

E35

F510

F30

WIP

RM

• Can we release all work in the first hour?• Do we want to release all work in the first hour?

Total to bereleased

• Calculate the net requirements (“Gross to net”)

Demand

Release of the work into the system


Release of the work into the system

We need to “choke” the release!

The material release should be directly connected to the drums – the shipping schedule and the blue machine schedule.

• This also helps decrease the inventory level.• Less inventory = Shorter MLT


The Buffer

timeDDMaterial Release

Buffer

MLT


Detailed schedule for the Blue resource


Quantity

Blue -Task


Schedule to ensure 100% On time for Product “A”


Quantity




• Demand for Products - relates to Product A type

• Step 2 - EXPLOIT - DRUM

• Blue resource schedule

• Schedule Product A - Green A5 task

• Step 3 - SUBORDINATE -

• Work Release according to our schedules

• ROPE and BUFFER



Simulator 850 Results - Run #3FINANCIAL STATEMENT UTILISATION OF RESOURCES





(Sales) Red ---- ---- ----




ORDER FULFILMENT


A 40

D 52

F 40

TOTAL


Recall your own decision making process:

What triggered your decision for new task assignments?

What was your rule for assigning a new task?

The “Paradise Plant”

How can we make it easier for the manager?


• The “Efficiency Syndrome” is alive and kicking in organisations

• For years, efficiencies are hammered into the people - always being busy has become the work ethic

• What is the effect of this on the flow?

• How should we work instead?

The “Road Runner” Work Ethic



Property of AOL-Time Warner

Beep! Beep! BeepBeep!!

The Road Runner

Or - The “Relay Runner” Work Ethic


Under the self assignment mode -

When they have finished their current task assignment, resources will check for work availability and assign themselves accordingly. They will also assign themselves if the previous task in the process is working or setting-up.

Yes, but…Are you happy with this decision?Is there any risk of allowing the resources of system 850 to assign themselves?

Solution: The resources that are at a split point in the process do not self assign. Self assignment will be performed only by resources that cannot make an irreversible mistake.

“Road Runner” - Self-assignment


Once you start the simulator - go to your resources and instruct them to work in a self-assignment mode by clicking on the Auto icon.

Do not self-assign for common parts! - do this by clicking on the Restricted button

Self-assignDo not Self-assign(Split point)

“Road Runner” - Own assignment




• Demand for Products - relates to Product A type

• Step 2 - EXPLOIT - DRUM

• Blue resource schedule

• Schedule Product A - Green A5 task

• Step 3 - SUBORDINATE -

• Work Release according to our schedules

• “Road Runner” Work Ethic - Self assignment



• Re-start the simulator

• Click params.850

• You should see the Paradise System on the screen

• Review the responsibilities of each team member for the execution of the schedules

• Follow your decisions and schedules - and use Auto-activate

• Click ‘Freeze’ icon to restart the simulator

• Look ahead - what is the next thing on your schedules, can it be done?

The Paradise Plant - Run #4


Simulator 850 Results - Run #4

FINANCIAL STATEMENT UTILISATION OF RESOURCES





(Sales) Red ---- ---- ----




ORDER FULFILMENT


A 40

D 52

F 40

TOTAL


Delegation

Discuss the implication of TOC delegation for:

Material Release on:• Material managers• Store control managers

Auto-activation on: • Machine Operators• Charge-hands • Supervisors • Production managers Machine Operator

Charge Hand

Supervisor

Production Manager


TOC Solutions

An Injection- a new facet that is introduced (injected) into the existing reality. The Injection eliminates a major cause for the conflict that underlies the core problem.

It is called an injection because once it ceases to exist, the system will rapidly revert back to the unsatifactory situation of the present. Therefore, there is a constant need to secure it’s existence.

It is called a breakthrough idea because so far it has not existed in the system under study.


List for Planning (Partial)

The Drum Injection

The Material Release Injection

The Buffer Size Injection

The“Road Runner” Injection

Partial list of injections – summary so far


Buffer Size

How to determine the Buffer Size

The Initial Value – We fix the shipping buffer to be the existing Manufacturing Lead Time (MLT) : the time that is used by production control to determine the material release for a customer order.

Later on – We upgrade the buffer size according to the behaviour of the buffer as per Buffer Management (will be discussed later on in the programme).


Good job

Don’t delegateSecure short

term performance

Focus on the Future (L/T)

Delegate

Delegation Cloud – A Manager’s DilemmaYes, but…


Injection : Delegation is done without losing control and with increasing performance.

Rule number 1 of management:Be paranoid!

Action: develop a safety net.Make sure you detect problems before they become disasters.

This is the Buffer Management.

Constructing a solution

What to Change to?


Zone I - The last zone before the Due Date, needed for expediting (Panic).

The buffer is divided into threenearly equal time “Zones”:

Buffer Management

Zone III - The first time Zone after material release. Is expected to be used for regular flow from the gating operation to its destination. [In our case the destination is the shipping area]

Zone II - The middle time zone. Used in order to track the missing orders and find the problems causing blockages to the flow.


MaterialRelease Customer Due Date (CDD)

time

Past DueOrdersZone IZone IIZone III

Flow Track Expedite(panic)

The Time Zones (per order)


Buffer management in our case, is the process of monitoring the production progress through checking the status of order completion.

We go to the shipping area, and record all the orders that have been completed - ready to be shipped.

Any order which is not physically present in the shipping area, or any order which is incomplete - is declared as missing.

In the Buffer Management terminology it is called - “A Hole in the Buffer”.

What is Buffer Management


The reaction to a hole differs from zone to zone:

Zone I - Expedite. You know what to do.

Zone II - Is used to improve the performance and to prevent things going wrong. We therefore, focus on this zone.

Zone III - We do nothing. The material is not supposed to be in the shipping area that quickly.



Analogy:• Think about check-in to a flight.

• Every passenger who has checked in, and is sitting at the gate is already in the shipping area.

• Any person who is not present at the departure gate at the moment of the “buffer check” is a hole in the buffer.

• The flight has a market DD - the time it is scheduled to take off.

• The flight information system helps the passengers to identify which time zone they are at any given moment, like: check-in, gate open boarding, last call, closed etc.

• The visibility helps every passenger to decide what to do.



The buffer monitoring system in plant 850 works like the airport system.The buffer manager looks one buffer time into the future.

Therefore, on the screen we will find all the orders needed to be completed within the next buffer time hours.

If we take, for example, buffer time = 12 hours, we have a 12 hours visibility on the screen.

Buffer Monitoring in Plant 850


Simulator 850 – Run # 5

We will strive to produce 40 units in total of each of the products: A, D and F. We will produce according to a shipping schedule of 8 units per day, in order to get an even production flow (no hockey-stick). Material will be released in accordance with the shipping schedule. Machines will be auto-activated. There will be a 12 hour shipping buffer that we will monitor through the Buffer Management. We will act in accordance to the Buffer Management rules:Green= Flow, Amber=Track and Plan, Red=Execute plan and expedite.


Simulator 850 – Run # 5Instructions:

Restart the simulation. Press “Schedule” and then “Open window”. Press “Free Product Timing”.

• Enter equal spread of 5 for products A and F

• Enter quantity and hour for product D: 8 units at hours 8, 16, 24, 32 and 40.

• Press “OK”.

Press “Show Shipping Timing” to ensure 5 batches of 8 units.


Simulator 850 – Run # 5Instructions:

Set a shipping buffer of 12 and tick the box marked “Schedule common part operation”. Ensure Auto-activation box is ticked.

Click “OK” to exit schedule screen and press the “BM” icon on the top bar. To start the simulator click on the “Freeze” icon.


Tracking Sheet- Run #5Product A Product D Product F

Planned Total

Actual Total

Planned Total

Actual Total

Planned Total

Actual Total

Day 1 8 8 8

Day 2 8 8 8

Day 3 8 8 8

Day 4 8 8 8

Day 5 8 8 8

8

16

24

32

40

8

16

24

32

40

Buffer Monitoring in Plant 850

8

16

24

32

40

T


Simulator 850 Results - Run #5

FINANCIAL STATEMENT UTILISATION OF RESOURCES





(Sales) Red ---- ---- ----




ORDER FULFILMENT


A 40

D 50

F 40

TOTAL


Net Profit: from ______ to ______

On Time %: from: ______ to ______

Simulator Results - Run # 5

Have you improved the performance of the system?


To What To To What To Change?Change?

What To Change?What To Change?

How To Cause How To Cause The Change?The Change?

System Improvement

The Three Key Questions

The way we plan the use of our resources and the supervision of the execution

We plan, schedule and supervise the use of our resources systematically, using the 5 Steps of Focusing

• We learn how to customise the ideas to our environment• We educate our people and support them with appropriate tools and help


There are in general four different types of production environments:

V.A.T.I. Their names were derived from looking at the relative

shape of the workflow from raw material to end product. The classification of types enables experts to quickly analyze an environment for sources of problems and identify needed details of the solution.

Production Environments


Market Demand

Raw MaterialB

Operation B120 units/hr

Operation A223 units/hr


Product A125 Units


Operation C218 units/hr


Product C150 Units

Product B125 Units

Numerous end products are produced from relatively few raw materials, with few integrations and many divergent points, with many common parts

V Environment


Relatively few end products are produced from a larger quantity of raw materials, many integration points, some of common parts.

Market Demand

Product B




Raw MaterialC




Raw Material A

Raw Material B

A Environment


The number of end products and number of subparts is exponentially large in comparison to its raw materials.

Assembly B620 units/hr

Assembly C423 units/hr


Raw MaterialC

Assembly A418 units/hr


Raw Material A

Assembly B438 units/hr

Assembly C615 units/hr

Assembly A620 units/hr

Product R45 Units

Product S 50 Units

Product T45 Units

Product U15 Units

Product V23 Units

Market Demand

T Environment


A few end products are produced by the same resources in the same sequence, one product type at a time.

Due to piping, mechanical connections or Kanbans, the statistical fluctuations in one resource usually stops the whole system in short order.

Raw Material X




Product X125 Units

Product Y125 Units

Raw Material Y

or

or


Dependingon the raw material,this system can either produce X’s or Y’s

I Environment


You are now being divided into up to 4 groups : V,A,T and I

Group V – simulation 60Group A – simulation 30Group T – simulation 300Group I – simulation 950Each group will have 2 runs on the simulations :

Run #1 – Manual runRun #2 – The implementation plan

V.A.T.I. Simulations


Instructions for Run #1 :

• In the Goldratt Simulator, Click on the “open session” icon • Select PARAMS. 60 and click “open”.• Take 10 minutes to plan• Press “enter” and start working

V-team : Simulation 60 V-team

“Open Session” icon.


Simulator # 60

B

C

R

W

SU Resources

240

60

120

Time: Pace:Week:

Cash: 4000

Next

FG

H

Length in Weeks: 2 Weekly Expenses: 8,000

13

5

A B C D E F

1

8

3

4

2

5

6

7

9

G

£100

6

60

B

10 15 5 15 10 20 4

7 5 3 34 5

30 25 15 30 45

15 15 20

10 10

£100

8

Raw Material Cost

£240 £250 £230 £180 £150 £250 £300 £280

V-team


Product Req. ShippedDDP PerformanceShipped/Req. %

Not Shipped

T perUnit

Lost T**

** Lost T = (Units not shipped) x (T per unit)

A

B

C

D

13

10

15

5

Run #1 ResultsV-team



Not Shipped

T perUnit

Lost T**


Total

E

F

G

H

15

10

20

4

Continuation…Run #1 resultsV-team


Now we will use the implementation plan that we developed earlier today.

The injections :

1. Drum 2. Buffer3. Material release (Rope)4. “Road runner” ethics

We will now run the simulation with a Dispatch schedule,Shipping Buffer and Auto-Activation.




• Restart the simulation by clicking on “Open Session” icon (or through “file” and then “Open”)• Select PARAMS. 60 and click “Open”






• To implement the batches – click on “Schedule” and then select “Open Window”.• From the Schedule window, select “Free Product Timing”.




• Enter 5 as “Number for Spread” for the A product and click on “Equal spread”.

• Repeat the process for all the products and click on “OK”




• Enter “12” into the “Shipping Buffer”. • Ensure the bottom box is clicked, for Auto-activation of non-constraints. • Click “OK” to return to the simulation.



Not Shipped

T perUnit

Lost T**


13

10

15

5

A

B

C

D

Run #2 ResultsV-team



Not Shipped

T perUnit

Lost T**


Total

E

F

G

H

15

10

20

4

Continuation…Run #2 resultsV-team


Run #2 results :

N.P. From ________(in run #1) to __________

Can you see the improvement ?

Did you have to intervene a lot ?

Was it easier ?



A-team : Simulation 30 A-team


• In the Goldratt Simulator, Click on the “open session” icon • Select PARAMS. 30 • Take 10 minutes to plan• Press “enter” and start working


Simulator # 30

Length in weeks: 2 Weekly Expenses: 17,000

A B C D E F

£55

B

G

C

M

W 1

8

4

2

5

6

7

9

SU Resources

10

60

120

Time: Pace:Week:

Cash: 2500

M

£45FG

G H

6

58

8

30

5

7

12

60

3

60

7

R30

10

£10 £15 £10 £15 £10Raw Material Cost

9

2

3

W

60

3

546

6

40

6

8

6

6

90

1

5

9

£60 £60



Not Shipped

T perUnit

Lost T**


A

C

E

F

60

90

60

30

Run #1 ResultsA-team



The injections :
























Not Shipped

T perUnit

Lost T**


A

C

E

F

60

90

60

30

Run #2 ResultsA-team


Run #2 results :

N.P. From ________(in run #1) to __________



Was it easier ?



T-team : Simulation 300 T-team




Simulator # 300

Length in weeks: 2 Weekly Expenses: 20,000

£75£420 300 £80320 £310

A B C D E F

£80

B

C

M

W 1

8

4

5

6

7SU Resources

15

5

Time: Pace:Week:

Cash: 4500

C

M

FG

G H

2

3

3

24

100

3

3

R

£18 £12 £5 £15 £16

Raw Material Cost

9

2

3

W

RR

15 M

W

BB

2

2

2

1

2

1

30

10

10 7 4

20

35

50

4

40

30

95

5

16

42

50

2

20

30

£15

£90

3

2

1

2 2

2

30



Not Shipped

T perUnit

Lost T**


A

B

C

D

100

20

50

40

Run #1 ResultsT-team



Not Shipped

T perUnit

Lost T**


Total

E

F

G

H

95

16

50

20

Continuation…Run #1 resultsT-team



The injections :
























Not Shipped

T perUnit

Lost T**


A

B

C

D

100

20

50

40

Run #2 ResultsT-team



Not Shipped

T perUnit

Lost T**


Total

E

F

G

H

95

16

50

20

Continuation…Run #2 resultsT-team


Run #2 results :

N.P. From ________(in run #1) to __________



Was it easier ?



I-team : Simulation 950I-team




Simulator # 950

B C D EA

9

8

7

6

5

4

3

2

1

£30

100

£25Raw Material Cost

Time: 00:00 Pace: 1

Week: 1 Day:1

SU Resources Next

B

M

C

G4

16

Weekly Expenses: £10000

Cash: £5000

B B B

R

G20

£500

R26

C7

B99

G20

R27

C7

B99 G27

M40

40

G30

M40



Not Shipped

T perUnit

Lost T**


E 100

Run #1 ResultsI-team



The injections :










I-team : Simulation 950 I-team









I-team : Simulation 950 I-team





Not Shipped

T perUnit

Lost T**


E 100

Run #2 ResultsI-team


Run #2 results :

N.P. From ________(in run #1) to __________



Was it easier ?



Drum (Dispatch schedule, Number of batches)

Start the implementationof the injections

RoadRunner

Material

Release

End ofimplementation

Drum Buffer Rope

Buffer Size

Injection Map


Reservations – Yes, but….

The flow type considerations have an impact on the implementation kit.

These considerations can be due to the specific characteristic of a plant.

These considerations can also be due to the product that the company manufactures or the market they operate in.

When implementing, we must take these aspects into consideration.


Material Release.

Gating common parts.

Rope

Shipping Buffer.

Dispatch BufferBuffer

The drum is in the market.Drum

Paradigm ShiftWhat exists now

What to change to

DBR Implementation Check


Early release is damaging. Idle time is opportunity time to help speed-up the flow.

Material Release.

Possibly Gate control.

•No early material release.

•Gating

•Road Runner Ethic

Rope

Buffer is an investment, that deserves a good return on investment (ROI).

Dispatch buffer exists (Either Prod. control or customer service). Shipping Buffer =MLT

Buffer time is for protection and needs to be managed!

Buffer

“We take our commitment seriously!”.

Local decision making is based on DDP.

Shipping schedule, Promised date to the customer

Company commits to shipping on time. Production commits to finishing according to the internal schedule (PDD)

Drum

Paradigm ShiftWhat exists now

What to change to

DBR Implementation CheckExample:


Shipping Zone0,I,II

Shipping Buffer Past-Due

Dispatch Buffer Management

ParadigmWhat exists nowTOC Concept: What to change to

Buffer Management Implementation Check


Look Ahead! Change of mind set to how can we help.

Non-existent Analysis of the holes in the bufferPlanning of corrective actions

Shipping Zone0,I,II

No blame, mind set is now how can we help.

Production meeting (daily), Expediting, people bring explanations to cover their back.

Short BM meetings to discuss what to do, getting commitments when an order will be due

Shipping Buffer Past-Due

“You and I against the problem”

Coordination meeting between production, production control, customer service (with continuous fighting)

Buffer Management Meetings which are focused to sort out difficulties and prevent new ones.

Dispatch Buffer Management

Paradigm Shift

What exists nowWhat to change to

TOC Concept

Buffer Management Implementation CheckExample:


Holes in Zone 1 - Expediting

Example for actions taken when in Zone 1:

• Add short term capacity: • Over time• Offload to another machine• Subcontracting• Stop “stealing” processes• Move resources to work on material needed for the holes

Take whatever action is necessary to prevent late arrival to the drum and later analyse the reason for

the hole in Zone 1 (fire-fighting TOC process).


Holes in Zone 2 - Analysing

Example for actions taken when in Zone 2:

• Check if there is a capacity constraint• Check if there is a material constraint• Check whether there is a procedure that causes the hole. • Is there a quality problem? Search for a defective process. • Assess the impact of the situation. Then, take action to expedite if there is a high risk of entering Zone 1

While doing analysis in Zone 2 we use the TOC Thinking Processes for problem analysis.


The Possible Negative Ramification: The addition of the buffers might enlarge our Quoted Lead Time -QLT

Example: Product F from SIM 850After implementing the solution:

What happens to the MLT? What happens to the QLT? What happens to the WIP?

G15

C12

M20

B14

M7

C10

** The Letter and number signify the machine colour and the number of minutes needed to process one unit

Demand: 40

How to Deal with Holes in the Buffer


The addition of the buffers might enlarge our QLT

In order to avoid the enlarged QLT, due to the added buffers, we must ensure that:

QLT › Σ Buffers

(The Quoted Lead Time is larger than the sum of the buffers)

The only way to determine whether we have calculated the right size buffer is to implement Buffer Management. By doing so, we will be able to determine if we should enlarge the buffer or decrease it.

Possible Negative Ramification


In a V-Plant, holes in the buffer can be caused due to “stealing” of material at split point in the process.

0 20

Demand: 10 Demand: 10Example: At the split point, the material should have been divided between the routes. Instead, the right route “stole” the material from the left route. This causes a hole in the buffer for the product in the left route.

Holes in Zone 1 and Zone 2 – Group V


Zone 2 – Analysis: In order to prevent this from happening again, we need to check the PMBs that exist.

PMB: Policy or Procedure

Measurements

Behaviour

Zone 1 – Expediting:We need to determine whose responsibility it is to deal with the problem and what can be done now to improve the situation. There are several options such as:• Replenishing – releasing a new batch or• Enlarging a release batch or • Doing nothing! (waiting for the next rescheduling)

Holes in Zone 1 and Zone 2 – Group V


In an A-Plant, holes in the buffer can be caused due to missing components for assembly.

Example: Most of the components that are required for the assembly are ready, except for one. The missing component has been delayed. The delay might be caused due to:

• A constraint• Capacity (resource)• Quality (scrap)• Machine breakdown• Machine set-up

X

Kitting – checking whether all the components are at the assembly point..

Holes in Zone 1 and Zone 2 – Group A


Example:

There is a greater chance that it will arrive on time.

Regulation of the flow and more predictability

Positive

Diminishes the position of the supervisor.

The supervisor covers during break times

Add capacity (no breaks on the machine) Vs. Not add capacity

More set-ups.

Complicated to implement

Secondary Drum

Work on this job Vs. work on another job

Constraint Resource

(CCR)

Negative Implications

The potential solution

The conflict

behind it

The Cause

Holes in Zone 1 and Zone 2 – Group A


In a T-Plant, holes in the buffer can be caused due to missing components for assembly or due to material being “stolen” in divergent points in the process (“T” has the characteristics of both “A” and “V” plants). In a T-plant there is usually no bottleneck

Missing component

Missing sub-assembly

Stolen Material

Holes in Zone 1 and Zone 2 – Group T


Possible solutions to the T-Plant holes in the buffer:

• Gating control – No auto activation. • Releasing material with a specific destination (end-product).• Routing cards• Inserting a buffer – Assembly or final assembly buffer.

Holes in Zone 1 and Zone 2 – Group T


Characteristics of I-Plants:

• Long Lead Time• Many operations• Several cycles• Several visits to the CT• Process time is significant• Excellent shop-floor tracking

Holes in Zone 1 and Zone 2 – Group I


• UDE – Undesirable Effect• Constraint • Injection• Drum• Rope • Road Runner Work Ethic• Buffer• CDD – Customer Due Date• Buffer Management• VATI

Recap Language

Documents

Post Graduate Session 2 Operations