Operations Management Short-Term Scheduling Chapter 15

1. Operations ManagementShort-Term SchedulingChapter 15

2. Learning Objectives When you complete this chapter, you should be able to : Identify or Define: • Gantt charts • Assignment method • Sequencing rules • Johnson’s rules • Bottlenecks

3. Learning Objectives - continued When you complete this chapter, you should be able to : Describe or Explain: • Scheduling • Sequencing • Shop loading • Theory of constraints

4. Delta Airlines • 10% of Delta’s flights disrupted per year - half of those by weather • Cost: $440-million in: • lost revenue • overtime pay • food and lodging vouchers • $33-million hi-tech nerve center • 18 staff • $35-million savings (per year)

5. Strategic Implications of Short-Term Scheduling • By scheduling effectively, companies use assets more effectively and create greater capacity per dollar invested, which, in turn, lowers cost • This added capacity and related flexibility provides faster delivery and therefore better customer service • Good scheduling is a competitive advantage which contributes to dependable delivery

6. Forward Scheduling Backward Scheduling B E B E Today Due Date Today Due Date Short-Term Scheduling • Deals with timing of operations • Short run focus: Hourly, daily, weekly • Types

7. © 1984-1994 T/Maker Co. Short-Term Scheduling Examples • Hospital • Outpatient treatments • Operating rooms • University • Instructors • Classrooms • Factory • Production • Purchases

8. Organization Managers Must Schedule Operating room use Patient admission Nursing, security, maintenance staffs Outpatient treatments Classrooms and audiovisual equipment Student and instructor schedules Graduate and undergraduate courses Production of goods Purchase of materials Workers Scheduling Decisions • Mount Sinai Hospital • Indiana University • Lockheed- Martin Factory

9. Organization Managers Must Schedule Chefs, waiters,bartenders Delivery of fresh foods Entertainers Opening of dining areas Maintenance of aircraft Departure timetables Flight crews, catering, gate, and ticketing personnel Scheduling Decisions • Hard Rock Cafe • Delta Airlines

10. Capacity Planning, Aggregate Scheduling, Master Schedule, and Short-Term Scheduling Capacity Planning 1. Facility size 2. Equipment procurement Long-term Aggregate Scheduling 1. Facility utilization 2. Personnel needs 3. Subcontracting Intermediate-term Master Schedule 1. MRP 2. Disaggregation of master plan Intermediate-term Short-term Scheduling 1. Work center loading 2. Job sequencing Short-term

11. Forward and Backward Scheduling • Forward scheduling: begins the schedule as soon as the requirements are known • jobs performed to customer order • schedule can be accomplished even if due date is missed • often causes buildup of WIP • Backward scheduling: begins with the due date of the final operation; schedules jobs in reverse order • used in many manufacturing environments, catering, scheduling surgery

12. The Goals of Short-Term Scheduling • Minimize completion time • Maximize utilization (make effective use of personnel and equipment) • Minimize WIP inventory (keep inventory levels low) • Minimize customer wait time

13. Types of Planning Files • Item master file - contains information about each component the firm produces or purchases • Routing file - indicates each component’s flow through the shop • Work-center master file - contains information about the work center such as capacity and efficiency

14. Loading Jobs in Work Centers • Assigning jobs to work centers • Considerations • Job priority (e.g., due date) • Capacity • Work center hours available • Hours needed for job • Approaches • Gantt charts (load & scheduling) - capacity • Assignment method - job to specific work center

15. Options for Managing Facility Work Flow • Correcting performance • Increasing capacity • Increasing or reducing input to the work center by: • routing work to or from other work centers • increasing or decreasing subcontracting • producing less (or more)

16. Start of an activity Day End of an activity Job Day 1 Day 2 Day 3 Day 4 Day 5 Day 6 Day 7 S T W T F S Scheduled activity time allowed Job A Actual work progress Job B Maintenance Non-production time Job C Point in time when chart is reviewed Now Gantt Scheduling Chart

17. Assignment Method • Assigns tasks or jobs to resources • Type of linear programming model • Objective • Minimize total cost, time etc. • Constraints • 1 job per resource (e.g., machine) • 1 resource (e.g., machine) per job

18. Sequencing Challenge Order release Job Packet Job XYZ Which job do I run next? Dispatch List Order Part Due Qty XYZ 6014 123 100 ABC 6020 124 50 Production Control Production

19. Sequencing • Specifies order jobs will be worked • Sequencing rules • First come, first served (FCFS) • Shortest processing time (SPT) • Earliest due date (EDD) • Longest processing time (LPT) • Critical ratio (CR) • Johnson’s rule

20. FCFS EDD SPT LPT CR Priority Rules for Dispatching Jobs • First come, first served • The first job to arrive at a work center is processed first • Earliest due date • The job with the earliest due date is processed first • Shortest processing time • The job with the shortest processing time is processed first • Longest processing time • The job with the longest processing time is processed first • Critical ratio • The ratio of time remaining to required work time remaining is calculated, and jobs are scheduled in order of increasing ratio.

21. First Come, First Served Rule • Process first job to arrive at a work center first • Average performance on most scheduling criteria • Appears ‘fair’ & reasonable to customers • Important for service organizations • Example: Restaurants

22. Shortest Processing Time Rule • Process job with shortest processing time first. • Usually best at minimizing job flow and minimizing the number of jobs in the system • Major disadvantage is that long jobs may be continuously pushed back in the queue.

23. Longest Processing Time Rule • Process job with longest processing time first. • Usually the least effective method of sequencing.

24. Earliest Due Date Rule • Process job with earliest due date first • Widely used by many companies • If due dates important • If MRP used • Due dates updated by each MRP run • Performs poorly on many scheduling criteria

25. Critical Ratio (CR) • Ratio of time remaining to work time remaining • Process job with smallest CR first • Performs well on average lateness Time remaining = CR Work days remaining Due date - Today' s date = Work (lead ) time remaining

26. Advantages of the Critical RatioScheduling Rule • Use of the critical ratio can help to: • determine the status of a specific job • establish a relative priority among jobs on a common basis • relate both stock and make-to-order jobs on a common basis • adjust priorities and revise schedules automatically for changes in both demand and job progress • dynamically track job progress and location

27. Job Sequencing Example

28. Summary

29. Critical Ratio (CR)

30. Jobs (N = 3) Saw Drill Job A Job B Job C © 1995 Corel Corp. © 1995 Corel Corp. Johnson’s Rule • Used to sequence N jobs through 2 machines in the same order

31. Time => 0 3 10 20 28 33 Work center 1 Work center 2 Time => 0 3 9 10 20 22 28 29 33 35 B E D C A Graphical Depiction of Job Flow = Idle = Job completed

32. Limitations of Rule-Based Dispatching Systems • Scheduling is dynamic; therefore, rules need to be revised to adjust to changes in process, equipment, product mix, etc. • Rules do not look upstream or downstream; idle resources and bottleneck resources in other departments may not be recognized • Rules do not look beyond due dates

33. Finite Scheduling System

34. Theory of Constraints • Deals with factors limiting company’s ability to achieve goals • Types of constraints • Physical • Example: Machines, raw materials • Non-physical • Example: Morale, training • Limits throughput in operations

35. Theory of ConstraintsA Five Step Process • Identify the constraints • Develop a plan for overcoming the identified constraints • Focus resources on accomplishing the constraints identified in step 2 • Reduce the effects of the constraints by off-loading work or by expanding capability • Once one set of constraints is overcome, return to the first step and identify new constraints

36. Bottleneck Work Centers • Bottleneck work centers have less capacity than prior or following work centers • They limit production output © 1995 Corel Corp.

37. Techniques for Dealing With Bottlenecks • Increase the capacity of the constraint • Ensure well-trained and cross-trained employees are available to operate and maintain the work center causing the constraint • Develop alternate routings, processing procedures, or subcontractors • Move inspections and tests to a position just before the constraint • Schedule throughput to match the capacity of the bottleneck

38. The 10 Commandments for Correct Scheduling • Utilization of a non-bottleneck resource is determined not by its own capacity but by some other constraint in the system • Activating a resource is not synonymous with utilizing a resource • An hour lost at a bottleneck is an hour lost of the whole system • An hour saved at a non-bottleneck is a mirage • The transfer batch may not, and many times should not, be equal to the process batch

39. The 10 Commandments for Correct Scheduling The amount processed should be verifiable and not fixed Capacity and priority need to be considered simultaneously, not sequentially Damage from unforeseen problems can be isolated and minimized Plant capacity should not be balanced The sum of the local optimums is not equal to the global optimum

40. Scheduling for Services • Appointment systems - doctor’s office • Reservations systems - restaurant, car rental • First come, first served - deli • Most critical first - hospital trauma room

41. Cyclical Scheduling • Plan a schedule equal in weeks to the number of people being scheduled • Determine how many of each of the least desirable off-shifts must be covered each week • Begin the schedule for one worker by scheduling the days off during the planning cycle (at a rate of 2 days per week on average)

42. Cyclical Scheduling - Continued • Assign off-shifts for the first worker • Repeat this pattern for each other worker, but offset by one week from the previous • Allow each worker to pick his/her “slot” or “line” in order of seniority • Mandate that any changes from the chosen schedule are strictly between the personnel wanting to switch

43. Operations ManagementJust-in-Time and Lean Production SystemsChapter 16

44. Learning Objectives When you complete this supplement, you should be able to : Identify, Describe or Explain: • Just-in-Time (JIT) philosophy • Lean Production

45. Introductory Quotation Waste is ‘anything other than the minimum amount of equipment, materials, parts, space, and worker’s time, which are absolutely essential to add value to the product.’ — Shoichiro Toyoda President, Toyota © 1995 Corel Corp.

46. Green Gear Cycling • Designs and manufacturers high performance travel bicycles (bike-in-a-suitcase!) • Strategy is mass customization with low inventory, work cells, and elimination of machine setups. • Major focus on JIT and supply-chain management. • Two lines with seven work cells • One day throughput time • Focus on quality

47. What is Just-in-Time? • Management philosophy of continuous and forced problem solving • Supplies and components are ‘pulled’ through system to arrive where they are needed when they are needed.

48. Lean Production • Lean Production supplies customers with exactly what the customer wants, when the customer wants, without waste, through continuous improvement.

49. Types of Waste • Overproduction • Waiting • Transportation • Inefficient processing • Inventory • Unnecessary motion • Product defects

50. Variability Occurs Because • Employees, machines, and suppliers produce units that do not conform to standards, are late, or are not the proper quantity • Engineering drawings or specifications are inaccurate • Production personnel try to produce before drawings or specifications are complete • Customer demands are unknown