1. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-1 Operations Management Short-Term Scheduling Chapter 15

2. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-2 Outline  GLOBAL COMPANY PROFILE: DELTA AIRLINES  THE STRATEGIC IMPORTANCE OF SHORT- TERM SCHEDULING  SCHEDULING ISSUES  Forward and Backward Scheduling  Scheduling Criteria  SCHEDULING PROCESS-FOCUSED WORK CENTERS

3. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-3 Outline - Continued  LOADING JOBS IN WORK CENTERS  Input-Output Control  Gantt Charts  Assignment Method  SEQUENCING JOBS IN WORK CENTERS  Priority Rules for Dispatching Jobs  Critical Ratio  Sequencing N Jobs on Two Machines: Johnson’s Rule

4. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-4 Outline - Continued  LIMITATIONS OF RULE-BASED DISPATCHING SYSTEMS  FINITE SCHEDULING  THEORY OF CONSTRAINTS  BOTTLENECK WORK CENTERS  REPETITIVE MANUFACTURING  SCHEDULING FOR SERVICES  Scheduling Service Employees with Cyclical Scheduling

5. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-5 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

6. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-6 Learning Objectives - continued When you complete this chapter, you should be able to : Describe or Explain:  Scheduling  Sequencing  Shop loading  Theory of constraints

7. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-7 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

8. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-8 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

9. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-9  Deals with timing of operations  Short run focus: Hourly, daily, weekly  Types Today Due Date BE Forward Scheduling Today Due Date BE Backward Scheduling Short-Term Scheduling

10. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-10  Hospital  Outpatient treatments  Operating rooms  University  Instructors  Classrooms  Factory  Production  Purchases © 1984-1994 T/Maker Co. Short-Term Scheduling Examples

11. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-11 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

12. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-12 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

13. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-13 Capacity Planning, Aggregate Scheduling, Master Schedule, and Short-Term Scheduling Capacity Planning 1. Facility size 2. Equipment procurement Aggregate Scheduling 1. Facility utilization 2. Personnel needs 3. Subcontracting Master Schedule 1. MRP 2. Disaggregation of master plan Long-term Intermediate-term Short-term Intermediate-term Short-term Scheduling 1. Work center loading 2. Job sequencing

14. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-14 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

15. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-15 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

16. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-16  Qualitative factors  Number and variety of jobs  Complexity of jobs  Nature of operations  Quantitative criteria  Average completion time  Utilization (% of time facility is used)  WIP inventory (average # jobs in system)  Customer waiting time (average lateness) Choosing a Scheduling Method

17. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-17 Level Use Methods Repetitive- Focused Product- Focused Process- Focused Variety of Methods Scheduling Methods Differ by Process

18. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-18  High variety, low volume systems  Products made to order  Products need different materials and processing  Complex production planning and control  Production planning aspects  Shop loading  Job sequencing Process-Focused Work Centers

19. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-19 Requirements for Scheduling Process-Focused Work Centers  Schedule incoming orders without violating capacity constraints of individual work centers  Check availability of tools and materials before releasing an order to a department  Establish due dates for each job and check progress against need dates and order lead times  Check work-in-progress as jobs move through the shop  Provide feedback on plant and production activities  Provide work-efficiency statistics and monitor operator times for payroll and labor distribution analyses

20. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-20 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

21. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-21 Process-Focused Planning System Forecast & Firm Orders Material Requirements Planning Aggregate Production Planning Resource Availability Master Production Scheduling Shop Floor Schedules Capacity Requirements Planning Realistic? Yes No, modify CRP, MRP, or MPS

22. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-22  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 Loading Jobs in Work Centers

23. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-23 Week Ending6/66/136/206/277/47/11 Planned input280 Actual input270250280285280 Cumulative Deviation-10-40 -35 Planned Output320 Actual Output270 Cumulative Deviation-50-100-150-200 Cumulative Change in Backlog 0-20-10-+5 Input-Output Control Explanation: 270 input, 270 output, implies 0 change Explanation: 250 input, 270 output implies –20 change (20 standard hours less in the work center)

24. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-24 Order Release Begins Shop Loading

25. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-25 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)

26. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-26  Shows relative workload in facility  Disadvantages  Does not account for unexpected events  Must be updated regularly Gantt Load Chart

27. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-27 Gantt Load Chart for Week of March 6  Shows relative workload in facility  Disadvantages  Does not account for unexpected events  Must be updated regularly Day Work Center MondayTuesdayWednesdayThursdayFriday MetalworksJob 349Job 350 MechanicalJob 349Job 406 ElectronicsJob 408Job 349 PaintingJob 295Job 408Job 349 ProcessingUnscheduled Center not available (for example, maintenance time, repairs, shortages)

28. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-28 Gantt Scheduling Chart Start of an activity Scheduled activity time allowed Point in time when chart is reviewed STWTFS Day Job Job A Job B Job C Maintenance Now End of an activity Actual work progress Non- production time Day 1 Day 2 Day 3 Day 4 Day 5 Day 6 Day 7

29. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-29  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 Assignment Method

30. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-30 Assignment Method - Four Steps  Subtract the smallest number in each row from every number in that row; then subtract the smallest number in every column from every number in that column  Draw the minimum number of vertical and horizontal straight lines necessary to cover all zeros in the table  If the number of lines equals either the number of rows or the number of columns, then you can make an optimal assignment (Step 4)  Otherwise:  Subtract the smallest number not covered by a line from every other uncovered number. Add the same number to any number(s) lying at the intersection of any two lines. Return to Step 2  Optimal assignments will always be at the zero locations of the table

31. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-31 Assignment Method – Type Setter Example Typesetter Job ABC R-34$11$14$ 6 S-66$ 8$10$11 T-50$9$12$7 Initial set-up

32. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-32 Step 1a & 1b Typesetter Job ABC R-34580 S-66023 T-50250 Typesetter Job ABC R-34560 S-66003 T-50230 Step 1aStep 1b

33. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-33 Step 2 Typesetter Job ABC R-34560 S-66003 T-50230 Smallest uncovered number

34. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-34 Step 3 Typesetter Job ABC R-34340 S-66005 T-50010 Make assignments

35. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-35 Production ControlProduction Which job do I run next? Dispatch List Order Part Due Qty XYZ 6014 123 100 ABC 6020 124 50 Job Packet Job XYZ Order release Sequencing Challenge

36. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-36  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 Sequencing

37. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-37 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. FCFS EDD SPT LPT CR

38. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-38  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 First Come, First Served Rule

39. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-39 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.

40. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-40 Longest Processing Time Rule  Process job with longest processing time first.  Usually the least effective method of sequencing.

41. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-41  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 Earliest Due Date Rule

42. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-42  Ratio of time remaining to work time remaining  Process job with smallest CR first  Performs well on average lateness CR Time remaining Work daysremaining Due date- Today's date Work (lead) time remaining = = Critical Ratio (CR)

43. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-43 Advantages of the Critical Ratio Scheduling 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

44. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-44 Criteria to Evaluate Priority Rules

45. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-45 Job Sequencing Example JobJob Work Processing time in days Job Due Date (day) A68 B26 C818 D315 E923

46. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-46 FCFS ParameterValue Average completion time 15.4 days Utilization36.4% Average number of jobs in the system 2.75 jobs Average job lateness 2.2 days Sequence A B C D E

47. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-47 SPT ParameterValue Average completion time 13 days Utilization43.1% Average number of jobs in the system 2.32 jobs Average job lateness 1.8 days Sequence B D A C E

48. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-48 EDD ParameterValue Average completion time 13.6 days Utilization41.2% Average number of jobs in the system 2.43 jobs Average job lateness 1.2 days Sequence B A D C E

49. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-49 LPT ParameterValue Average completion time 20.6 days Utilization27.2% Average number of jobs in the system 3.68 jobs Average job lateness 9.6 days Sequence E C A D B

50. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-50 Summary RuleAverage Completion Time (days) Utilization (%) Average Number of Jobs in the System Average Lateness (Days) FCFS15.436.42.752.2 SPT13.043.12.321.8 EDD13.641.22.431.2 LPT20.627.23.689.6

51. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-51 Critical Ratio (CR) JobJob Work Processing time in days Job Due Date (day) Critical Ratio A680.75 B260.33 C8180.44 D3150.20 E9230.39 Sequence A C E B D

52. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-52  Used to sequence N jobs through 2 machines in the same order © 1995 Corel Corp. SawDrill Job A Job B Job C Jobs (N = 3) Johnson’s Rule

53. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-53 Johnson's Rule - Scheduling N Jobs on Two Machines ÊAll jobs are to be listed, and the time each requires on a machine shown. ËSelect the job with the shortest activity time. If the shortest time lies with the first machine, the job is scheduled first; if with the second machine, the job is scheduled last. ÌOnce a job is scheduled, eliminate it. ÍApply steps 2-3 to the remaining jobs,working toward the center of the sequence.

54. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-54 List jobs & activity times Select job with shortest time Machine? Schedule FIRST Schedule LAST Eliminate job from list Jobs left? Break arbitrarily Ties? Yes 1 2 Yes Stop No No Johnson’s Rule Steps

55. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-55 Johnson’s Rule - Example JobWork Center 1 (Drill Press) Work Center 2 (Lathe) A52 B36 C84 D107 E712

56. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-56 Johnson’s Rule - Example A Step 1 BA Step 2 BCA Step 3 BDCA Step 4 BEDCA Step 5

57. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-57 Graphical Depiction of Job Flow BEDCA BEDCA Work center 1 Work center 2 0 3 10 20 28 330 3 9 10 20 22 28 29 33 35 Time => B EDCA = Job completed = Idle

58. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-58 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

59. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-59 Finite Scheduling System

60. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-60  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 Theory of Constraints

61. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-61 Theory of Constraints A Five Step Process ÀIdentify the constraints ÁDevelop a plan for overcoming the identified constraints ÂFocus resources on accomplishing the constraints identified in step 2 ÃReduce the effects of the constraints by off- loading work or by expanding capability ÄOnce one set of constraints is overcome, return to the first step and identify new constraints

62. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-62  Bottleneck work centers have less capacity than prior or following work centers  They limit production output © 1995 Corel Corp. Bottleneck Work Centers

63. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-63 Techniques for Dealing With Bottlenecks 1.Increase the capacity of the constraint 2.Ensure well-trained and cross-trained employees are available to operate and maintain the work center causing the constraint 3.Develop alternate routings, processing procedures, or subcontractors 4.Move inspections and tests to a position just before the constraint 5.Schedule throughput to match the capacity of the bottleneck

64. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-64 The 10 Commandments for Correct Scheduling 1.Utilization of a non-bottleneck resource is determined not by its own capacity but by some other constraint in the system 2.Activating a resource is not synonymous with utilizing a resource 3.An hour lost at a bottleneck is an hour lost of the whole system 4.An hour saved at a non-bottleneck is a mirage 5.The transfer batch may not, and many times should not, be equal to the process batch

65. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-65 The 10 Commandments for Correct Scheduling 6.The amount processed should be verifiable and not fixed 7.Capacity and priority need to be considered simultaneously, not sequentially 8.Damage from unforeseen problems can be isolated and minimized 9.Plant capacity should not be balanced 10.The sum of the local optimums is not equal to the global optimum

66. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-66 Repetitive Manufacturing - Advantages of Level Material Use  Lower inventory levels, releasing capital for other uses  Faster product throughput  Improved component quality and hence improved product quality  Reduced floor space requirements  Improved communication among employees because they are closer together  Smoother production process because large lots have not “hidden” the problems

67. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-67 Scheduling for Services  Appointment systems - doctor’s office  Reservations systems - restaurant, car rental  First come, first served - deli  Most critical first - hospital trauma room

68. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-68 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)

69. Transparency Masters to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 15-69 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