Scheduling product focussed systems


In product focused systems, there are only a few standardized product designs, the products are usually produced on produce-to-stock and sell basis. Finished goods inventories are held and the production rates of individual products exceed their demand rates.

Some of the scheduling implications are:

1. Little pre production planning concerning route sheets, job instructions, process plans and product design.

2. Schedules can be based on economic production runs (EBQ) for products without firm delivery schedules to customers.

3. The major scheduling concerns are timing of production line change- over and length of production runs.

The most common scheduling decisions are

(a) How long should the production run be for each product model and when should machine change-over be scheduled?

(b) If products are to be produced to a specific delivery schedule stipulated by the customer at any point of time (during a review period) how many cumulative units should have passed each up stream process step, if future deliveries are to be on schedule? The techniques used in resolving scheduling related problems in product-focused production systems are:

1. Batch scheduling
2. Scheduling and controlling production for delivery schedules.

Batch Scheduling

Batch production falls between job shop production and continuous. In batch production system, the output is can be stored as inventory for further processing or as finished products and can be produced in substantial volume, even-though the volume may not justify continuous production. In these situations, it is necessary to determine the lot-size for a batch to be produced at one time in addition to scheduling the batch on the facilities. Examples of such production are production of pharmaceutical products, paints etc., Decision to be taken by Operations manager are

(i) the lot size; and
(ii) The scheduling decision regarding when to begin the processing of the batch.

A key-off in the determination of the lot size for an item is between set-up costs and inventory carrying costs. Another important consideration is the requirement to produce a feasible schedule that meets the demand for all items. For example, if set-up costs are low as compared to inventory carrying costs, it may be advantageous to go for small lot sizes but it may not be possible to produce the required quantities of all items within the specified time period if these small lot sizes are employed. This will happen if much of the time is consumed for machine set-ups thereby reducing the available production time. To overcome this problem, larger lot sizes may have to be employed which will result in higher inventory carrying costs. Hence, it is necessary to compute economic lot sizes while maintaining feasibility in scheduling batches of such lot sizes for the items to be produced.

Economic Batch Quantity (EBQ) or Economic Run Length (ERL)

Two types of costs associated with lot manufacture are:

(a) Set up costs i.e. costs/unit which decrease with batch size.
(b) Inventory carrying cost which increases with batch size.

Set up cost includes:

(i) Cost of releasing work orders, shop orders, stores requisitions, tool requisitions etc.
(ii) Cost of first off inspection, cost of rejections till machine set up is ready for production run.
(iii) Machine set-up cost for mounting accessories, tools, jigs and fixtures on the machine.

Inventory carrying costs include:

(i) Cost of working capital tied up in average inventory.

(ii) Cost of handling and storing materials (i.e. parts produced)

(iii) Insurance charges and taxes.

(iv) Cost of spoilage and obsolescence etc.