Synchronous Manufacturing and

the Theory of Constraints

2
Synchronous Manufacturing and the
Theory of Constraints
The Goal of the firm
The hockey-stick phenomenon
Performance measurement
Capacity and flow issues
10
Some Capacity Related
Terminology
Capacity
Available time for production
Bottleneck
Capacity is less than demand placed on
resource
Nonbottleneck
Capacity is greater than demand placed on
resource
Capacity-constrained resource (CCR)
Capacity is close to demand placed on
resource
21
Bottlenecks and CCRs
Flow-Control Situations
A bottleneck
(1) with no setup required when changing from
one product to another
(2) with setup times required to change from one
product to another
A capacity constrained resource (CCR)
(3) with no setup required to change from one
product to another
(4) with setup time required when changing from
one product to another
11
Whats Going to Happen?
X Y Market
Case A
X Y
Bottleneck Nonbottleneck
Demand/month 200 units 200 units
Process time/unit 1 hour 45 mins
Avail. time/month 200 hours 200 hours
12
Whats Going to Happen?
Y X Market
Case B
X Y
Bottleneck Nonbottleneck
Demand/month 200 units 200 units
Process time/unit 1 hour 45 mins
Avail. time/month 200 hours 200 hours
13
Whats Going to Happen?
X Y
Assembly
Market
Case C
X Y
Bottleneck Nonbottleneck
Demand/month 200 units 200 units
Process time/unit 1 hour 45 mins
Avail. time/month 200 hours 200 hours
14
Whats Going to Happen?
X Y
Market Market
Case D
X Y
Bottleneck Nonbottleneck
Demand/month 200 units 200 units
Process time/unit 1 hour 45 mins
Avail. time/month 200 hours 200 hours
15
Components of Production
Cycle Time
Setup time
the time that a part spends waiting for a
resource to be set up to work on this same
part
Process time
the time that the part is being processed
Queue time
the time that a part waits for a resource while
the resource is busy with something else
16
Components of Production
Cycle Time
Wait time
the time that a part waits not for a resource
but for another part so that they can be
assembled together


Idle time
the unused time
the cycle time less the sum of the setup time,
processing time, queue time, and wait time
17
Saving Time
Bottleneck Nonbottleneck
What are the consequences of saving
time at each process?
18
Drum, Buffer, Rope
A B C D E F
Bottleneck (Drum)
Inventory
buffer
(time buffer)
Communication
(rope)
Market


Module 2
4
Goldratt Proclaims
The goal of a firm is to make money.
3
The Hockey Stick Phenomenon
The end-of-period rush!
Period
1 2 3 4
Output
($)
5
Performance Measurement
Financial
Net profit
an absolute measurement in dollars

Return on investment
a relative measure based on investment

Cash flow
a survival measurement
6
Performance Measurement
Operational
1. Throughput
the rate at which money is generated by the
system through sales
2. Inventory
all the money that the system has invested in
purchasing things it intends to sell
3. Operating expenses
all the money that the system spends to turn
inventory into throughput
7
Productivity
Does not guarantee profitability
Has throughput increased?
Has inventory decreased?
Have operational expenses decreased?
8
Unbalanced Capacity
Earlier, we discussed balancing assembly
lines.
The goal was constant cycle time across all
stations
Synchronous manufacturing views
constant workstation capacity as a bad
decision.
9
The Statistics of Dependent
Events
Rather than balancing capacities, the
flow of product through the system
should be balanced
Process Time (B) Process Time (A)


Thank You

Gopakumar S
Binisha Manu